Transwind Infrastructures Ltd Management Discussions.

BUSINESS OVERVIEW:

Your company is a reputed and well-known Ahmedabad based company having its presence in construction services industry, since many years. The Company has mainly working in the a rea of Infrastructural Development such as construction, Railways Signaling and Telecommunication, Gas distribution Network and Irrigation and Water distribution network. The core area of working of the company is Railways Signaling and Telecommunication. Infrastructure is a key driver of the overall development of Indian economy. This sector focuses on major infrastructure sectors such as power, roads and bridges, dams and urban infrastructure. Ministry of Urban Development has made focus in the emerging area of Infrastructural Development sector. The changing infrastructure landscape in India has generated significant interest from international investors.

ECONOMIC:

The workshop on Adaption & Sustainability of Modern Technologies in Railways Signalling & Telecommunication with focus on skill Development & Make in India was held on 19th April, 2017. Signal & Telecom Action Plan 2022 covers by 2022 electronic interlocking system will be provided at more than 3000 stations of Indian Railways. ATP systems will be provided on more than 10,000 kms of High Density Network (HDN) routes. Report also says it is planned to complete track Detection works on all station of Indian Railways.

Indian Oil Corporation, the nations largest oil company, plans to invest Rs 20,000 crore in city gas distribution projects in next 5-8 years as it bets big on gas business to complement its traditional oil refining and marketing business.

Irrigation in India includes a network of major and minor canals from Indian rivers, groundwater well based systems, tanks, and other rainwater harvesting projects for agricultural activities.

OPPORTUNITIES & THREATS

Opportunities:

1. Strong Economic Scenario:

India has emerged as one of the worlds fastest growing major economies. The overall macro-economic scenario in the country is positive with low inflation, reduced key interest rates, low commodity prices, rising foreign investments and improved global confidence in the region various structural reforms and government initiatives.

2. Regulatory Changes:

The major regulatory changes by the Government in the area of Infrastructure Development, and Urban Development policy enhance the positive atmosphere among the people and Industries as whole.

3. Governments Outlook to Investing in the Indian Infrastructure Sector

Infrastructure is a key driver for the Indian economy. Increased spending in this sector has a multiplier effect on overall economic growth as it necessitates industrial growth and manufacturing. This in turn boosts aggregate demand by improving living conditions.

Threats:

1. Fund Crunch:

The Infrastructural Development demands huge long-term investments in projects. Lack of cheap funds or foreign investments may lead to delays in the project resulting in losses. As a Government contracting company it requires certain deposits with government department which leads to Blocking of Fund and less working capital.

2. Decline in Bank Credit:

The rising non-performing assets (NPAs) and cases of fraud have resulted in banks getting stringent on its credit approval leading to a decline in their credit line for all the industries. This is likely to create liquidity issues for the Infrastructural Development sector as well.

3. Shortage of Labor, supply and Technology:

The Infrastructural Development sector in India, being highly dependent on manual labor, is facing a major challenge in terms of availability of manpower which in turn leads to project delays even more due to certain policy of Government Company regarding supply of goods from their side and quality measurement certification leads to delay in work.

Category wise performance:

Particular

FY 2017-18

FY 2016-17

S & T work

55244690

6 16 94 252

Gas Distribution Work

8

2 95 21 842 0527353

Annual Maintenance Work

5490788

51 47 077

Irrigation work

21378293

1 41 81 350

Financial and Operational Highlights:

The Profit after tax is Rs. 82.82 lakhs for the financial year 2017-18 as compare to Rs. 61.90 lakhs in the previous financial year 2016-17.

The PBT level has also grown by 27.90% over the previous year i.e. from Rs. 89.29 lakhs of previous financial year to Rs. 114.21 lakhs in the current financial period.

In last FY, your company has participated in 52 Tenders of different segments and in 13 Tenders declared L1 bidder. More-than 2889.52 Lacs work were awarded and are being executed with required asking rate.

Your company has successfully completed and closed 3 S&T Projects & 3 CGD projects respectively, which were awarded long back.