Patel Engineering, the civil infrastructure construction company that specializes in hydel and irrigation projects has bagged Rs 3859 crore mega irrigation project contract in consortium with Navyuga Construction and BHEL. It is for construction of part of the largest irrigation project in India i.e. Package 6 of Pranahita – Chevella Lift Irrigation Scheme, which targets to bring about 1220000 acres of drought prone land in Telangana region under irrigation with the 160 TMC of water diverted through this lift irrigation channel from Pranahita river.
The share of the company in the Rs 3859 crore order is 66-67% and that of Navayuga is 33-34%%. From its share of 66-67%, Patel has to procure electro mechanical and hydro mechanical equipments from BHEL which is expected to be about 30-33% of the total order value. The project is expected to get commissioned within next 48 months. The order book of the company (inclusive of its share of the Pranahita-Chevella Lift Irrigation contract) stands over Rs 7000 crore with about 48% of the order book being hydel projects and about 42% being irrigation projects. Typically margins are high in hydel and irrigation projects and low in road projects.
The company is currently executing the Bheema Lift Irrigation project Stage I, which is likely to be completed by end of February 2009 as scheduled. Likewise, another project under execution is the Kalwakurthy Lift irrigation stage I, which is likely to be completed by end of Jan 2010. The company indicated that it has already bagged orders in excess of 2500 crore sofar and is hopeful that its order book growth will be the highest in the current fiscal. It plans to intensify focus in high margin areas like hydro power and irrigation, both in India and abroad.