Building a path for national development

Think of a country as a human body. Just as our bodies depend on a network of arteries and veins to supply essential nutrients and oxygen to every cell, so too do countries depend on their infrastructure to maintain all functions. Roads, bridges, railroads, and communications networks serve as the nation’s arteries, transporting people, goods, and information throughout the country.

GPT infrastructure projects serve as the artery of the country’s economy. The efficient transportation networks they create connect businesses to markets, reduce transportation costs, and stimulate economic activity. As an infrastructure development company, their work has a profound impact on the lives of millions of people and contributes to the well-being of the nation in many ways.

With improved performance over the years, GPT Infrastructure’s stock price has risen to Rs 171.8 currently, compared to Rs 48.40 a year ago. It recorded a whopping 255% return, will it continue to rise? Come and learn more about our company.

GPT Infrastructure Project Industry Overview

India’s infrastructure sector is going through a period of significant change. It is an important driver of economic growth, urbanization and overall national development. The infrastructure sector serves as the main engine of the Indian economy.

To achieve its economic development target of $5 trillion by 2025, India must focus on improving its infrastructure. The 2023-24 budget aims to increase infrastructure spending by 33%, reaching US$10 billion (equivalent to US$122 billion). This increase is more than three times the spending in 2019-20 and accounts for 3.3% of India’s GDP.

Rail (12%), roads (18%), energy (24%) and urban development (17%) account for nearly 71% of projected infrastructure spending. It is estimated that India will attract $100 billion worth of foreign direct investment (FDI) in 2022-23.

GPT Infrastructure Project Company Overview

GPT Infrastructure Project It is a leading infrastructure development company in India with a rich history dating back to 1980. They are the flagship company of the GPT Group and their expertise lies in two key areas which include civil and infrastructure projects and concrete sleeper manufacturing.

For civil engineering projects, we handle everything from bridge and road construction to railway and power plant construction. They are known for their end-to-end solutions. This means we oversee the entire project life cycle, from design to construction and maintenance. They also specialize in building complex structures such as cable-stayed bridges.

GPT Infra Projects is a pioneer in the manufacture of concrete sleepers, a key component for safe and reliable railway tracks. The company has its own manufacturing facilities in Panagarh (West Bengal), Ladysmith (South Africa) and Tsumeb (Namibia). The company was listed on the stock exchange on July 15, 2016 and converted into a public limited company.

GPT Infraprojects achieved its highest ever order volume in the third quarter of fiscal 2024, valued at $299.1 billion as of December 31, 2023. Orders received in the nine months of FY24 were $143.9 billion, approximately 3.6 times FY23 revenues. They expect closed orders to reach around $400 billion in FY 25.

Currently, GPT infrastructure projects are underway in various projects including Prayagraj Project, Ghazipur Project, Mathura – Jhansi Project, Nimtita Project and Byculla Project.

Product and segment overview of the GPT Infra project

Civil and infrastructure projects

This sector focuses on the design, construction and maintenance of a wide range of civil infrastructure projects. They build and repair bridges, build railways and industrial parks. Our major customers in this segment are government agencies like NHAI, MORTH, state PWD for road/highway construction projects and we are currently working on Prayagraj Project, Ghazipur Project and Nimtita Project in this segment.

concrete sleeper manufacturing

GPT Infra Project manufactures high-quality concrete sleepers, a critical component that ensures track stability and safety in railways. The main customers of this segment are railway authorities in India and African countries. In India, we have a factory in Panagarh that supplies Indian Railways. They bid on some sleeper contracts in Namibia and South Africa.

In the fiscal year 22-23, the company earned a revenue of ₹71,235.92 lakh rupees from infrastructure projects and a revenue of ₹7,967.85 lakh rupees from concrete sleeper manufacturing.

In the fiscal year 22-23, the company earned a revenue of ₹71,235.92 lakh rupees from infrastructure projects and a revenue of ₹7,967.85 lakh rupees from concrete sleeper manufacturing.

Finance of GPT Infrastructure Project

GPT Infrastructure Projects in FY 2023 witnessed an increase in revenue amounting to Rs 890 million, up 19.85% compared to Rs 675 million in FY 2022. This has happened due to better execution in the infrastructure sector. After analyzing three years from fiscal year 2021 to fiscal year 2023, the company recorded a compound annual growth rate (CAGR) of 9%.

The company’s net profit also increased by 30.43% in fiscal 2023, reaching Rs 30 million from Rs 23 million. In fiscal year 2023, the company’s ROE increased by 1.82% due to higher profits driven by higher sales, while the company’s ROCE remained at 14%, the same as the previous year.

GPT infrastructure business future plans

• As the government continues to focus on the infrastructure sector, the company plans to maintain its billings at 3.2-3.5x. GPT expects orders to grow at a CAGR of 20% over the next three years and plans to achieve a closed order volume of Rs 4,000 crore by next year.
• GPT is also in the process of reducing its working capital cycle by double digits over the long term and plans to achieve ROCE and ROE close to 20% over the long term.
• GPT infrastructure projects have been awarded contracts worth $740 million. NHAI At the same time, we plan to bid on other large contracts.
• GPT has been awarded several contracts for concrete sleepers in Namibia and South Africa. As the Indian government plans to build three new cargo corridors after the completion of the eastern and western corridors, the company aims to set up one or two plants in the new cargo corridors. GBP expects concrete sleepers to contribute 10% to 12% of its total revenue going forward.

conclusion

Looking at the performance of the GPT Infra business, the company’s performance appears promising. Our expertise in civil and infrastructure projects, combined with our leadership in concrete sleeper manufacturing, positions us as a versatile contributor to national growth. With India’s infrastructure boom, diverse capabilities and well-established presence, they are well positioned to capitalize on future opportunities.

However, navigating competition, ensuring project efficiency, and incorporating sustainability practices are critical to long-term success. Do you think the future of GPT infrastructure projects will continue to grow? Please share your thoughts in the comments below.

Written by Pavunkumar VM

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