Engineers India to get into solar thermal, nuclear power

Established in 1965, state-owned Engineers India (EIL) is involved in engineering consultancy & project management services for the oil & gas and infrastructure sectors. It also does turnkey projects in the same. EIL, which falls under the ministry of petroleum & natural gas, had a Rs970 crore follow-on public offer (FPO) in July, through which the government divested 10% of its stake, bringing down its holding to 80.40%. The company’s chairman & managing director since October 2009 and former head of Mahanagar Gas, Ashok Kumar Purwaha is spearheading EIL’s plans to diversify into newer areas in infrastructure. The electrical engineer from Delhi University talks to DNA on the same, spreading EIL’s footprint globally and why EIL has no manpower worries.

Your Q2 numbers were not as robust as those of Q1. Is that normally the case because of the monsoon?
We normally register a growth of 40% in topline. And this year, what’s important is that our profit from operations grew 50%. There is a only a slight impact of monsoons in the second quarter. Last year, our turnover was Rs1,994 crore and the first half of this year we have already done Rs1,200 crore.

How does the second half look and are you on track to meet your targets?
I don’t want to mention a number but the growth trend of H1 continues and the management is confident of similar growth in Q3 and Q4.

Where does your order-book stand?
It’s about Rs9,000 crore, of which over 65% is turnkey and the rest consultancy & management.

Will the composition remain the same?
Yes.

And how does the pipeline look?
Quite good. In March our order-book was Rs6,300 crore and we are already at Rs9,000 crore so you can see the kind of growth we will have.

Though you have a presence in infrastructure, it’s minimal. Any plans to ramp that up?
We did two stadiums for the Commonwealth Games and we are looking to focus on water & waste water management. We are already working on the Yamuna pollution abatement programme and there are a couple of other assignments too. There is a lot of potential in this area with municipalities and state governments putting a lot of effort into it.

How about roads?
We don’t want to do roads because they are a little simpler than other areas. We have a huge knowledge base and what we would like to do is get in where we can add value. In power, for instance, we want to be involved in balance of plant (BoP) for nuclear power. The reason for getting into waster water management is we have been doing this in petrochemical complexes where we handle wastes of much more complex nature than municipal wastes. We are also looking at solar thermal energy and natural gas distribution.

But your core area will continue to be hydrocarbons?
Yes, we have been doing it for 45 years, be it upstream, midstream or downstream. But within the core area, we want to go to newer geographies like Africa, Venezuela and Brazil where the hydrocarbon potential is to be further explored and exploited. In the 20 refineries operating in India 17 have our footprint. We want to use this expertise to explore new markets.

Has there been any progress on your UAE joint venture with Italian firm Tecnimont SpA?
No, it’s not given the desired results so far.

Coming to human resources, how difficult is to attract and retain talent in the midst of strong competition from private companies?
We have 3,400 engineers and our attrition rate is just 1.3%. When people joins us, we have a very structured way of training them. The professional satisfaction coming out of working on a multiplicity of complex projects is immense. The second thing is monetary satisfaction. We are a Schedule A company and at entry level, our pay scale is superior to those offered by the private sector.

One last question, a personal note. How do you unwind?
I play golf on some weekends. I also listen to music and watch TV and spend time with my family.