BUSINESS

Valecha plans consortium for airport development

By Raghavendra Kamath in Mumbai
July 17, 2007 09:24 IST

Infrastructure company Valecha Engineering plans a consortium with European companies to bid for build-operate-transfer projects in airport development. Through this, it plans to bid for 35 non-metro airports coming up for development in India as well as international airport developments.

Valecha Engineering along with the Nepalese partner Y P Construction is bidding for the runway and taxiway overlay work at the Tribhuvan International Airport in Kathmandu, for which qualifications were announced a week ago. Valecha was among the only two Indian companies qualified to bid for the project, the other being the New Delhi-based IRCON International. Four Chinese companies have also qualified for the Rs 35 crore (Rs 350 million) project, Valecha said.

"The most important part in airport development is multiplying resources in a very short time. We have done Mumbai International Airport, Chennai International Airport, Dimapur in Nagaland, Vadodara airport and are doing projects in Jaipur and Khajuraho airports. We are confident of doing domestic and international projects," Valecha Engineering Managing Director J K Valecha said.

The airport development space has already attracted the attention of big players such as the Tata-Changi airport consortium, GVK-Airports Company, South Africa and GMR Infrastructure Fraport AG India Development Fund.

Tata-Changi said it has bid for three airports in Karnataka recently and announced that it will bid for all the 35 non-metro airports.

Valecha is planning to shift its revenue mix from road construction to higher margin areas of airport development, metro trains and water management. So far, it was getting 70 per cent of revenues from roads and 30 per cent from ground engineering. Going forward, it would reduce the share of roads to 50 per cent, with the remaining coming from the three newer areas, Valecha said.

Valecha Persys, the company's JV with the Malaysian firm Persys, would bid for the upcoming metro tain projects, he said, adding that the company would add more JV partners in other areas of expertise. The 50:50 JV is bidding for the Bangalore Metro Project. Twelve companies are in the fray for the Rs 3,000-crore (Rs 30 billion) project, including Simplex Infrastructure and L&T.

In water management BoT projects, the company has received offers from European firms. "Through this collaboration, we will do effluent water treatment projects. We are already in the final stages of negotiations with two firms. With urban infrastructure under pressure, water managment will be metred and sold. We intend to play major role in it,'' he said.

The airport development space has already attracted the attention of big players such as Tata-Changi airport consortium, GVK-Airports Company South Africa and  GMR  Infrastructure Fraport AG India Development Fund.

Tata-Changi said it has bid for 3 airports in Karnataka recently and announced that it will bid for all the 35 non-metro airports.

Valecha is planning to shift its revenue mix from road construction to higher margin areas of airport development, metro trains and water management. So far, it was getting 70 per cent revenues from roads and 30 per cent from ground engineering. Going forward, it will reduce the share of roads to 50 per cent and the remaining from the three newer areas, Valecha said.

Valecha Persys, the company's JV with Malaysian firm Persys will bid for upcoming metro train projects, he said adding that the company will add more JV partners in other areas of expertise.The 50:50 JV is bidding for Bangalore Metro project. Twelve companies are in the fray for the Rs 3,000 crore project including Simplex Infrastructure and L &T.

In water management BoT projects, the company has received offers from European firms. "Through this collaboration we will do affluent water treatment projects. We are already in final stages of negotiations with two firms. With urban infrastructure under pressure, water management will be metred and sold. We intend to play major role in it,'' he said.

Earlier this year, Valecha and Singapore-based civil engineering firm Koon Holdings entered into a pact to pick up stake in each other. Valecha said the JV with Koon will be kicked off by this year end and start operations in marine engineering, port building and dredging works. Valecha Gulf, Valecha's subsidiary in Middle East for building construction and piling, is foraying into Abu Dabhi and Qatar after consolidating in Dubai, he said.

Raghavendra Kamath in Mumbai
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