IVRCL plans to raise 500 cr this fiscal
IVRCL plans to raise 500 cr this fiscal. Infrastructure major IVRCL has cut its employee strength by almost 23 per cent in the last fiscal as a cost cutting measure caused by economic slowdown coupled with delays in execution of projects.
The cash-strapped company expects the situation to improve during the current financial year on the back of measures such as Corporate Debt Restructuring
Hyderabad: Infrastructure major IVRCL has cut its employee strength by almost 23 per cent in the last fiscal as a cost cutting measure caused by economic slowdown coupled with delays in execution of projects. "It is part of cost cutting measures," IVRCL Group's Chief Financial Officer Balaram Reddy said when asked about the reason for cutting jobs.
Besides, the company plans to raise Rs 500 crore through the Qualified Institutional Placement (QIP) route during the financial year to meet working capital requirements. "We may raise up to Rs 500 crore during the current financial year. Mostly it will be through QIP route.
This is to meet the working capital requirements. An enabling resolution will be passed in the forthcoming Annual General Meeting," Reddy said. The company is also in the process of "proactively" exploring the monetisation of assets and reducing subsidiaries, according to the firm's latest annual report.
The number of permanent employees has come down to 2,875 (as on March 31, 2015) against 3,737 during the previous financial year, the report said.
"IVRCL has implemented cost optimisation measures such as cutting overheads and rationalisation of human resources. These internal cost cutting measures are expected to improve profitability going forward," it added.
The cash-strapped company expects the situation to improve during the current financial year on the back of measures such as Corporate Debt Restructuring (CDR) package and tighter working capital cycle. "The company has applied for CDR and the same has been approved.
In the circumstances, the situation is expected to improve by FY16 onwards with expectations of improvement in macro-economic conditions. "Further, it is expected that the steps taken by the company for improving the operational parameters, wherever feasible, would show signs of improvement.
"Consequently, the company expects to see an improvement in cash flows due to tighter working capital cycle and realisation of claims by FY16 onwards and expects to maintain healthy margins thereafter," the annual report said.
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