Water EPC business is “unpredictable”, says CEO Mittal
Indian water EPC company VA Tech Bag is aiming to increase its market share as an operator of water treatment infrastructure...
Indian water EPC (engineering, procurement and construction) company VA Tech Bag is aiming to increase its market share as an operator of water treatment infrastructure.
Currently, revenues are split 75% from EPC and 25% from operation & maintenance (O&M) but the company is aiming to change this to a 70/30 split.
In an exclusive interview with WWi magazine, group CEO Rajiv Mittal, said: “We want our fixed costs to be taken of by O&M. The EPC business is very unpredictable and is very changeable. So we don’t want to only depend on EPC to take care of our fixed costs.”
He added: “Our O&M business used to be just 10%. Then we had a vision and strategy for this to be much more. We want to be lifecycle partners for our customers.”
In a wide ranging interview, covering India’s smart cities programme to industrial water reuse, Mittal said the company is on track to meet reported ambitious targets of generating $1 billion in annual revenue by 2018. In 2014 revenue was $333 million.
Mittal said: “Even in Egypt, which is in turmoil, we are executing half a dozen projects. This type of strategy and having a strong technology back up, as we have our own technologies, we believe we will be able to meet this $1 billion target.”
It was in October 2010 when Mittal took VA Tech Wabag public, which he described as “one of the most successful IPOs [Initial Public Offering] of the time”.
Commenting on desalination developments in Asia, he said that with India’s growing water scarcity, potable water requirements will be met by desalination along coastal areas of India in the future.
A WABAG joint venture was awarded the contract to design, construct and operate the Nemmelli 100,000 m3/day reverse osmosis plant from the Chennai Metropolitan Water Supply and Sewerage Board, which started up in 2013.
The city is now moving plans ahead for a fourth desalination plant, which will be co-funded by the Japan International Cooperation Agency (read WWi article).
- The full interview with Rajiv Mittal will appear in the Feb-March edition of WWi magazine. To sign up for a free digital copy, click here.