Consistently Creating Value
Judicious selection of projects, strong cost control measures and declining financial leverage have made Dilip Buildcon one of the fastest growing infra and EPC companies in India
Photo Credit :
Bhopal-headquartered Dilip Buildcon (DBL), a leading EPC (Engineering, Procurement and Construction) and infrastructure company with footprint in 17 states, is today synonymous with excellence, trust and most optimal output for all stakeholders. Since starting out three decades ago in Madhya Pradesh, DBL has taken the organic route to become one of the fastest growing infrastructure companies in the country.
Dilip Suryavanshi, Chairman and MD of DBL attributes its success to meticulous planning at each and every step of its operations, right from the project bidding stage to resource mobilization and earliest possible completion” as well as the dedication of its 35,000-plus employees. The four pillars of its success are growth, diversification, consistency and value creation while creating a positive impact on the society and the nation.
“By staying true to our core values, DBL has remained one of the most coveted brands among leaders in roads and highway construction and EPC business in India,” says Suryavanshi.
DBL has maintained very fine balance between order book growth and profitability of projects. The company’s order book has grown from Rs 51,60.9 crore in FY14 to Rs 2,11,71.8 crore in FY19 at a CAGR of more than 32.7 per cent. As of 31st March 2019, 85 per cent of its projects are from the central government and 15 per cent from the state governments. The contribution of private projects is virtually insignificant now.
DBL’s revenue has grown from Rs 2,630 crore in FY15 to Rs 9,164.6 crore in FY19 at a 36.6 per cent CAGR. The earnings before interest, taxes, depreciation and amortization (EBITDA) rose from Rs 571.6 crore in FY15 to Rs 1,650.8 crore in FY19 at a CAGR of 30.4 per cent. Profit after tax (PAT) increased from Rs 144.7 crore in FY15 to Rs 763.9 crore in FY19 at a CAGR of 51.6 per cent. The sharp spike in bottom line has been indicative of judicious selection of projects, strong cost control measures and declining financial leverage.
The RoE and RoCE, which stood at 18.1 per cent and 19.3 per cent respectively in FY15, had improved significantly in FY19 to 27 per cent and 22.6 per cent respectively, reflecting strong focus on asset turnover, optimal usage of capital and consistent value creation for shareholders.
Another key parameter to asses an EPC company is how efficiently it utilizes its working capital. While DBL’s revenue has grown 3.5 times, the working capital days have been significantly reduced to more than 50 per cent over four years.
The debt levels are reasonable and the primary usage of debt is in purchase of equipment which is a source of strong competitive advantage. In FY19, DBL had a net debt of Rs 3,387.6 crore, and a significant part of it (~45 per cent) was on account of equipment.