From expresways to Real Estate to cement to power, jaypee group has proved its worth as a diversified ENTITY WITH A FOCUS on infrastructure. In an exclusive Interaction with Manoj Gaur, Executive Chairman, Jaiprakash associates ltd. Priyanka Rai & Deepak Ranjan Patra attempt to find out how the group is planning to elevate itself to a new level
When do you expect to achieve break-even in this particular project?
In a way, I should say we have already achieved break-even. Though the expressway is yet to be completed, our revenues from real estate have already started flowing in. We have invested nearly Rs.97 billion in this project, including an equity investment of Rs.12 billion, IPO proceeds of Rs.15 billion, loans of around Rs.60 billion and real estate proceeds of Rs.10 billion. Of this, we thought the real estate proceeds would come by March 2011, but we achieved those by March 2010 itself.
Do you have any more real estate projects in the pipeline apart from the five integrated cities that you are planning around the expressway?
Yes, there are five projects under Jaypee Infratech Ltd. Apart from the same, we have a division Jaypee Sports, which has two kinds of activities. Under its core activities, we are constructing a world-class cricket stadium, and an F1 track, which will start in October 2010. Under the non-core activities, we are constructing a sports city. Apart from these, the Ganga Expressway project (from Greater Noida to Baliah) is also there. We have plans to develop nine more cities around that expressway. But that’s for the future. At present, we are focussing on these five cities on the Yamuna Expressway and the sports city.
Of late, Jaypee Group is trying to strengthen its hospitality business. In that line, there is a lot of buzz about your new flagship hotel in Greater Noida.
We will be inaugurating it in October this year. We are building it in collaboration with Sixth Sense Spa in the Greater Noida golf course. It will be unique and one of its own kind in North India. Sixth Sense is a reputed name in South East Asia, when it is about Spas. At this moment, I do not have the liberty to disclose much information about the same. However, I can say that the hotel will be the first five star hotel inside a 450-acre golf course. Let’s see how it goes.
Recently, Jaypee Fertilizers agreed to enter into a 50:50 JV with Duncan Industries to revive their Urea plant (in Panki, UP) that has been closed for over 5 years. What are you planning to achieve from this venture?
Be it media, cement, fertilizers or any other industry, only those players will survive who have perseverance, credibility and quality. This plant was once a very reputed plant. It got closed down for variety of reasons. At Jaypee, we believe that fertilizer, like electricity, cement and roads, is also a very critical sector for the country’s growth. Every year, we import around 7 to 8 million tonnes of urea, and here, while we have a plant, it is closed. So we thought of reviving the plant and modernising it by infusing competitive modern technology. And with this, we think we can also prove that we’re reasonable players amongst the private fertilizer manufacturers.
Do you have any plans to raise funds from the market for this fertilizer venture, or for that matter for any other venture of your group companies?
No, we do not have any such plans in the near future.
Jaypee Group has grown manifolds in the past few decades. Where would you like to see yourself after two decades from here?
Today, our cumulative market cap is around Rs.400 billion. We will hope that our next generation moves on with the philosophy that we have always followed. Numbers are certainly inspiring, but we believe that our growth should always continue and our shareholders should feel proud on us. Having said that, I think if our organisation is in the top 50 today, I would like to see it remain among the top 10 after 20 years. But more than that, it should be one of the most respected companies by all parameters.
In a way, I should say we have already achieved break-even. Though the expressway is yet to be completed, our revenues from real estate have already started flowing in. We have invested nearly Rs.97 billion in this project, including an equity investment of Rs.12 billion, IPO proceeds of Rs.15 billion, loans of around Rs.60 billion and real estate proceeds of Rs.10 billion. Of this, we thought the real estate proceeds would come by March 2011, but we achieved those by March 2010 itself.
Do you have any more real estate projects in the pipeline apart from the five integrated cities that you are planning around the expressway?
Yes, there are five projects under Jaypee Infratech Ltd. Apart from the same, we have a division Jaypee Sports, which has two kinds of activities. Under its core activities, we are constructing a world-class cricket stadium, and an F1 track, which will start in October 2010. Under the non-core activities, we are constructing a sports city. Apart from these, the Ganga Expressway project (from Greater Noida to Baliah) is also there. We have plans to develop nine more cities around that expressway. But that’s for the future. At present, we are focussing on these five cities on the Yamuna Expressway and the sports city.
Of late, Jaypee Group is trying to strengthen its hospitality business. In that line, there is a lot of buzz about your new flagship hotel in Greater Noida.
We will be inaugurating it in October this year. We are building it in collaboration with Sixth Sense Spa in the Greater Noida golf course. It will be unique and one of its own kind in North India. Sixth Sense is a reputed name in South East Asia, when it is about Spas. At this moment, I do not have the liberty to disclose much information about the same. However, I can say that the hotel will be the first five star hotel inside a 450-acre golf course. Let’s see how it goes.
Recently, Jaypee Fertilizers agreed to enter into a 50:50 JV with Duncan Industries to revive their Urea plant (in Panki, UP) that has been closed for over 5 years. What are you planning to achieve from this venture?
Be it media, cement, fertilizers or any other industry, only those players will survive who have perseverance, credibility and quality. This plant was once a very reputed plant. It got closed down for variety of reasons. At Jaypee, we believe that fertilizer, like electricity, cement and roads, is also a very critical sector for the country’s growth. Every year, we import around 7 to 8 million tonnes of urea, and here, while we have a plant, it is closed. So we thought of reviving the plant and modernising it by infusing competitive modern technology. And with this, we think we can also prove that we’re reasonable players amongst the private fertilizer manufacturers.
Do you have any plans to raise funds from the market for this fertilizer venture, or for that matter for any other venture of your group companies?
No, we do not have any such plans in the near future.
Jaypee Group has grown manifolds in the past few decades. Where would you like to see yourself after two decades from here?
Today, our cumulative market cap is around Rs.400 billion. We will hope that our next generation moves on with the philosophy that we have always followed. Numbers are certainly inspiring, but we believe that our growth should always continue and our shareholders should feel proud on us. Having said that, I think if our organisation is in the top 50 today, I would like to see it remain among the top 10 after 20 years. But more than that, it should be one of the most respected companies by all parameters.
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
For More IIPM Info, Visit below mentioned IIPM articles.
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An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
For More IIPM Info, Visit below mentioned IIPM articles.
Zee Business Best B-School Survey 2012
Prof. Arindam Chaudhuri's Session at IMA Indore
IIPM IN FINANCIAL TIMES, UK. FEATURE OF THE WEEK
IIPM strong hold on Placement : 10000 Students Placed in last 5 year
IIPM's Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri - A Man For The Society....
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM B-School Facebook Page
IIPM Global Exposure
IIPM Best B School India
IIPM B-School Detail
IIPM Links
