Key takeaways of the meet

Global outlook is water positive and that throws up strong growth opportunities for the company. Rapid urbanization is expected to drive the demand for water treatment including waste water treatment. The company continues to focus on large size complex projects for both water and waste water for which it has built up references as well as expertise.

In Middle East Asia region the demand is primarily for large number of desalination plants and reuse plants given that region being water scarce one. Abudhabi New Economic Vision 2030 that aims setting up of new industrial zones as well as worker quarters as well as similar projects in Qatar are expected to augur well for demand going forward in this market. In North Africa the focus is on Engineering on Supply contract through LCs. The Sub Saharan Africa, which is a new focus geography for the company will target at industrial projects funded by Government to Government (G2G). In Latin America the focus is largely on Sewerage and O&G sector. While sewerage is the prime focus area in Brazil and Argentina, the company will focus a lot in oil & gas sector in Mexico.

Crude oil price though stood lower in FY17, about 50% of its order inflow in FY17 came from oil & gas sector as there is strong investment in downstream side of oil and gas sector such as refinery, petro chemicals etc. Expect steady flow of orders from this sector this fiscal as well.

India is expected to throw up massive opportunities with programmes such as Namami Gange. Against a sewerage generation of 1535 MLD the treatment capacity is just about 467 in West Bengal, it is just 1341 MLD and 373 MLD in case of Uttar Pradesh and 636 MLD and 109 MLD in case of Bihar. So there are strong opportunities in sewerage segement under Namami Gange project. Gujarat and Madhya Pradesh are planning for Namami Gange kind of project for Narmada. The company expects two contracts for complete city water management for 2 cities to be tendered out soon under Namami Gange project.

Big ticket projects such as the Rs 574.5 crore Koyambedu, Rs 520.4 crore Saudi Arabia Desal plant will start contributing to top-line from current quarter and fiscal. However the Vietnam project still is in the framework.

The net working capital days that came down from 77 days in FY16 to 68 days in FY17 will improve further as high working capital projects are moving towards closure and increased contribution from projects with better working capital cycle as well as export projects.

The company sticks to the guidance given at the start of current fiscal. A sales of Rs 38-40 billion and order intake of about Rs 43-45 billion from about Rs 3600 crore in FY17.

Middle East market though faces some delay in project finalizations the company does not expect that to be a major concern as there is no scaling down of investment in water segment and the company has also used this as opportunity to look at newer geographies.

No plan to get into the business of manufacturing and selling water purifiers in immediate/medium or long term.

The company has written off its investment of Rs 18 crore in Spanish Subsidiary and has not claimed the eligible tax benefits in FY17 but that will be claimed in FY18 consulting with the auditors. In case of Oman project the company has completely provided its share of losses and there is no future write offs in this project.

Trade receivable greater than 2 years are Rs 90 crore and greater than 1 year are Rs 340 crore.

About 54% of its EPC projects are international orders.