After IT, retail, FMCG and healthcare, it is the infrastructure sector that’s feeling the heat.
Plans to recruit people in Sri Lanka, Bangladesh and the Philippines
MUMBAI: Talent crunch and attrition appear to be taking the wind out of India Inc’s sail. After IT, retail, FMCG and healthcare, it is the infrastructure sector that’s feeling the heat.
Or, so it seems in the case of Kolkata-based infrastructure solutions provider, Simplex Infrastructures. The Rs 2,000 crore Kolkata-based firm is faced with an acute manpower crunch at a time when it has an order book of Rs 9,000 crore to execute in the next few years.
It recently bagged an order worth Rs 481 crore for the 1,050-MW Maithon Thermal Power Project from the joint venture of Tata Power and DVC. The project is scheduled for completion in 2009.
The talent crunch has forced the company to look at hiring people from other countries. It is in talks with government officials in Sri Lanka, Bangladesh and the Philippines to recruit talent for its overseas projects.
The company may also bring the recruits into the country for its projects here and would consult government officials before taking the final call, sources said.
Simplex is adding over 100 employees every month for its current and future projects.
It has 145 separate teams, each with 30-40 people, under its six regional offices in Delhi, Mumbai, Kolkata, Chennai, Doha and Dubai.
N K Kakani, executive director, Simplex Infrastructure, told DNA Money, “Talent crunch is the biggest challenge as ready efficient hands are difficult to get in the present circumstances. Timely execution is a key part of the infrastructure business, which depends on people rather than on getting new orders.”
A brokerage research report, too, said the key determinant of Simplex’s revenues was timely execution of projects in hand. Any delay would limit its revenue growth, the report said, adding, it could change the whole picture for the company in any given year.
Simplex’s attrition rate is around 10%.
Kakani said most of those leaving would have served the company for less than two years. However, those who stay for more than two years, normally continue with it for a long time.
According to an Assocham study, there is a manpower shortage of 50-60% in the construction and engineering sector, which accounted for a meagre 8.7% of the employment opportunities compared with the IT industry’s 24% last year.
A Nasscom-McKinsey report said India Inc’s biggest challenge would be a shortage of around 5 lakh knowledge workers by 2010. Compounding the problem further is the fact that only 25% of the fresh engineers are employable by multinationals.
For the third quarter ended December (Q3), Simplex recently reported a 58% year-on-year growth in turnover to Rs704 crore (Rs446 crore) and 22.7% growth in the profit after tax to Rs22 crore (Rs17 crore). Revenue and profits also rose on a sequential basis, from Rs571 crore and Rs19 crore, respectively.
B D Mundhra, chairman and managing director, Simplex Infrastructures Ltd. said, “We have embarked on a large variety of new projects domestically and globally during the last quarter, resulting in improved profitability. Riding on the infrastructure boom, we are committed to explore every opportunity within its fold. We are bullish about the forthcoming quarters as well and we look forward to attaining greater heights.”
r_mithun@dnaindia.net
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