Tata Projects, the engineering, procurement, and construction (EPC) unit of the Tata Group, expects to achieve profitability in the next 18 to 24 months as a result of improved project execution and other factors, according to Managing Director Vinayak Pai. In FY21–22, the infrastructure major, which has consistently delivered strong top-line growth, reported revenue of ₹13,531 crore.
According to Pai, bottom-line growth is important — even more important than top-line growth. “The first step is strengthening our project delivery capabilities, and the second is trying to be specific about which industries to focus on, and balance when taking risks. These factors together will undoubtedly increase profits.”
He added, “As the company enters the overall transformation, with the start of value chain stabilization, we expect an increase in project delivery to be seen within 6 to 12 months. As a result, it will take 18 to 24 months to reach at least the top quartile in the industry, and we look forward to seeing our progress in that direction.”
Most of the revenue comes from the government
Tata Projects generates 80 percent of its business from the government sector, while around 9-10 percent comes from other companies such as Tata Steel, Tata Chemicals, and others.
“Our focus on the government sector has been a large part of our revenue, but we want to balance that with private sector investment. So, we intend to increase the contribution from in-house companies, along with more private sector opportunities,” said Pai.
The EPC market continues to be strong as more manufacturers continue to turn to the private sector in India due to global supply chain issues, the company said.
Apart from the power sector, Tata Projects says it has developed strong expertise in the hydrocarbon part of the energy market. “We expect significant investment to emerge in the hydrocarbon segment and open opportunities. Currently, we are working on three major units for our HRL plant in Barmer, Rajasthan.”
Tata Projects directly employs approximately 11,000 people across its businesses and offers services including engineering, procurement, construction, commissioning, inspection and expedition, operations, repair & maintenance, and decommissioning services.