For years we have believed in shaping our frontiers ourselves. We have proactivelychannelized our expertise and experience into a direction where our flexi-business modelpresents us with ample growth opportunities.
We have come a long way and evolved from being a city-based real estate developer to ameaningful player in the civic-urban infrastructure segment today. At Nila we know thatour customers projects demonstrate progress. They bring opportunity for individualsand territories. It is our responsibility to help our customers deliver on the promise ofthese projects and more. We are not only motivated to be a meaningful company in theindustry; we are determined to be the best. We do that by anticipating trends aligningour expertise with customers needs transforming delivery building progress andbreaking new grounds in what we do. The diversity of the projects we have executed hasreinforced our expertise experience and foresightedness to create meaningfulopportunities in civic urban infrastructure segment and acts as a catalyst to our growth.After strengthening our EPS business we are now focussing on the PPP segment. This is sureto bring about yet another wave of transformation.
We have always looked at creating opportunities with a fresh perspective and not justthe way they appear.
The next challenges: Global megatrends - from the expected population surge to thescarcity of resources - are changing the way we design construct and operate criticalstructures and systems that will benefit society for the long term. Where the world seeschallenges we see solutions. This has helped us map our paths and grow diversely.
The rapid increase in the worldwide population and the rise of urbanization are drivingdemand for resilient and reliable infrastructure. The worlds population is projectedto increase from some 7.4 billion today to 9.6 billion by 2050. Meeting this growthrequires the equivalent of a new city of 1.5 million people to be built every week for thenext 35 years!
Our capability profile is convergent with the needs of the nation. TheGovernments recent emphasis on developing civic urban infrastructure creating"Smart Cities" and the Pradhan Mantri Awas Yojana "Housing for Allby 2022" thrust opens up an exciting canvas of opportunities for us. Hence theCompany being already active in affordable housing space the focus of central and variousstate governments on creating more affordable houses presents us a huge opportunity forgrowth in our core area of strength. We are a private player working in the publicinterest and capable of creating value for all the stakeholders. Our aim is to design andimplement the most efficient environmental and social solutions against the backdrop ofthe increasing scarcity of natural resources. Our engagement with key projects gives atopical resonance to the Companys idea BuildToTransFORM .
As per the Census 2011 data a total of 13.65 million slum households have beenreported in 4041 statutory towns i.e. a decadal increase of 34%. Considering the samedecadal rate the slum households are projected to go upto 18.00 million. Furthermorethere will also be 2.00 million non-slum urban poor households. Hence total housingshortage envisaged to be addressed through these missions is 20.00 million. The missionwill mainly cater to the needs of the EWS (Economically Weaker Sections) and LIG (LowerIncome Group) which currently account for 95.6% of urban housing shortage. This hasspurted the demand for development of affordable housing across the country.
We are very enthusiastic about this opportunity as it aims to construct more than 20.00million houses across the length and breadth of the nation within a short span i.e. by2022. We are extremely enthusiastic about it
Gujarat became countrys first state to take up PPP Projects for rehabilitation ofslum dwellers. As an established local player of Gujarat with proven execution expertisewe have been actively participating in selective bids. We have secured Ahmedabadsunique Slum Rehabilitation and Redevelopment Project. This is amongst the first set ofprojects to be bid out on PPP basis. We shall continue to bid selectively despite beingpre-qualified across several such projects to secure superior remuneration in the form ofTDRs and the balance vacant land ensuring steady and sustainable growth.
Venturing into Rajasthan
We believe in creating opportunities - proactively.
We believe that Rajasthan is a Sunrise-state and has bountiful potential to developcivic urban infrastructure. During the year we signed an MoU under the "ResurgentRajasthan Partnership Summit 2015" for development of civic urbaninfrastructure including affordable houses. As assured the Government of Rajasthan(GoR) is actively facilitating including "Single Window Service" for smoothimplementation of the projects. This strategically works to our advantage in diversifyingour geographical presence. Today 40% of our order-book comprises our projects inRajasthan at Jodhpur Bhilwara and Udaipur.
When opportunity is backed with preparation a strengthened identity is sure to emerge.
Affordable Housing projects on EPC/turnkey basis comprises 90% of our order book. Thisis a self-reliant model where government facilitates the overall proposition. Apredetermined consideration is collected periodically from the interested beneficiaries.The developer is then paid by the principal on establishing adherence to the stipulatedparameters (quality specifications time etc.) through independentauthorities/consultants. Such funding dynamics minimise our risk and ensure smoothliquidity.
With the demand-supply gap already positive by a great extent it is projected tosustain for a medium term. The qualitative stipulations will act further as catalyst to aparadigm shift on the perspective of Government Housing post delivery and inhabitation bythe actual beneficiary.
We have been systematically addressing our financial resources to ensure upgradation inour external credit rating. Brickwork Ratings India Pvt Ltd has upgraded the bank loanrating of the Company from "BBB" (Stable) and "A3" to "BBB+"(Stable) and "A2"on December 28 2015.
While "BBB" (Stable) and "A3" as assigned by India Ratings &Research Pvt Ltd continues. This places us very favourably with banks enabling theCompany to rationalize the overall borrowings at quite competitive terms.
Long-term vision enables to spot opportunities and convert them into reality at theright place right time.
During the year we signed an MoU with the leading automobile dealer and an eminentlogistics player "Kataria Group" of Ahmedabad. Under the MoU the Company hascreated three (3) legal entities in the form of Joint Venture (JV) and Associate to workjointly for acquiring land and developing industrial and logistics parks units shedsplots residential colonies and allied infrastructure at various locations situated nearthe upcoming automobile hub at Bechraji about 90 kms from Ahmedabad at Gujarat. Theentities are actively engaged in land aggregation process. The operations are expected tocommence in FY2017. Our projects serve the common good and contribute to a long-lastingtransformation of territories and the ecosystems. Aware of our role we apply a pragmaticand responsible development policy that involves all stakeholders concerned. It isperceived to be a once-in-a-life-time-growth opportunity and in long-term these entitieswill look for selective value monetization as and when the opportunity arises.
Our growth journey
Planting trees today will offer more shades tomorrow.
Our growth journey has only begun and we already have a strong order book offeringsustainable margins. Going ahead we will explore construction opportunities in civilurban infrastructure projects and may invest in modern cost-effective and proventechnologies. Together these will ensure swift execution quick turnaround with adherenceto the quality stipulations.
I would like to take this opportunity to thank my fellow Board Members Nila-itescustomers vendors and other stakeholders who have collectively enabled a recordsuccessful year. Every new day is an opportunity to better ourselves and collectively worktowards our common goal of building a better tomorrow.
CMD - Nila Infrastructures Limited