Hindustan Construction Co's infra subsidiary to raise Rs300 crore by March

Hindustan Construction Company’s infrastructure development arm plans to raise Rs200-300 crore by end of this fiscal, said HCC chief financial officer Praveen Sood.

The money could be raised through a private equity placement or convertible debt.

“We have not got the right valuation yet,” Sood said. He had in June told DNA Money the company was looking at equity infusion into HCC Infrastructure, a 100% subsidiary, to fund existing and future projects. HCC has been reported to be looking to divest 20-30% in HCC Infrastructure.

Private equity firms have of late shown interest in picking up stakes in individual infrastructure projects or in group of projects.

In August, Norwest Venture Partners and Xander Group invested Rs400 crore for a 22.22% stake in the Ahmedabad-based Sadbhav Engineering’s project development division.

HCC Infrastructure has six national highway projects, together worth over Rs5,500 crore of which one is operational and another, from New Delhi to Faridabad, is close to commissioning.

HCC Infrastructure plans to grow its portfolio to Rs15,000 crore in two years.
It is also weighing options in hydro power and water, according to HCC’s website.

Ajit Gulabchand, chairman, HCC, recently said the company would look at taking HCC Infrastructure taking public in 3-4 years after growing its business to about Rs20,000 crore.

Another of HCC’s subsidiaries, Lavasa Corporation, is said to hit the market next month to raise about Rs2,000 crore.

For the quarter ended September 30, HCC’s net sales grew 4.2% year on year to Rs898.5 crore and net profit more than doubled to Rs12.2 crore.

The order book of HCC stood at Rs19,735 crore as of September 30 and the company hopes to take it to Rs25,000 crore by March.