Bartronics readies funds for UID

Bartronics, one of the leading players in the RFID, smart card and biometric solutions market, is likely to raise equity to prepare for the unique identification (UID) cards project taken up by the Centre.

The quantum of funds to be raised would be decided in a month’s time.

“We are slightly stretched on the debt front since we had to raise about Rs 600 crore recently to fund one of our major projects. We are evaluating raising further equity since we have significant headroom on that front,” Bartronics managing director Sudhir Rao told DNA.

The company currently has an equity base of about Rs 29 crore and is evaluating options including a qualified institutional placement, private equity and infusion by promoters.

“Though we are also looking at a foreign currency convertible bonds, equity is the most preferred option,” Rao said.

According to him, the UID processes are still being defined at this point and it would take another 6-8 months for the government to call for bids. “From our perspective, the project is about 12-14 months away. We are already well positioned to get a good portion of it. Since we were part of the multipurpose national identification card project which was considered to be a pilot for the UID project, we have several systems and processes already in place to handle the project,” he said.

Bartronics is currently participating in five bids for government projects and the progress made in these orders would determine the equity quantum to be raised.

“We are strong in at least two projects which would offer us a market of about Rs 70 crore. But all the five projects together promise a market of Rs 200 crore,” Rao said.
The company currently has an order-book of about Rs 700 crore to be executed in the next one year.

Bartronics would set up kiosks for citizen assistance under Apke Dwar, a Delhi government programme to set up information kiosks at about 2,000 locations. “We are investing about Rs 800 crore on this project. We have raised about Rs 600 crore through debt, Rs 160 crore is being ploughed back from our accrued income and Rs 50 crore is being invested by the promoters,” he said.

The kiosks would offer advertisement space to Bartronics, and the Commonwealth games next year would be a major advertisement-revenue opportunity.

The company is also expecting a major breakthrough in the Asian market with its association with the Singapore-based Avitar, a mobile phone distribution company. Avitar would use Bartronics’ RFID solution to track mobile phones distributed through its network. “We are starting with a pilot worth a couple of crores. But, once we take it to commercial level, it would fetch us about Rs 50-60 crore. Avitar is also planning to commercialise our solution for other mobile distribution companies. This would mean a major global opportunity for us,” he said.

Though the company continues to see difficulty in progressing at the desired pace in recording revenues, it is not revising its guidance. “We are not changing the revenue guidance as yet. We are confident of scaling the Rs 1,000 crore mark,” he said.