Himachal Futuristic Communications Ltd. (HFCL), predominantly a manufacturer of Optical Fibre Cables (OFC), has secured an EPC order worth Rs. 1,770 crore from State Water & Sanitation Mission (SWSM), Govt. of Uttar Pradesh.
HFCL to Provide EPC and O&M Services for Rural Water Supply in Varanasi
HFCL’s order entails EPC works for SWSM’s rural water supply network in the Varanasi revenue division, Uttar Pradesh. The company has stated that it will also be laying OFC for carrying out Operation and Maintenance (O&M) operations for this project efficiently.
Out of the total worth of this order, Rs. 1,414 crore will be used towards the cost of raw materials and the execution of the EPC project. The remaining amount of Rs. 356 crore of the contract amount has been earmarked for 10 years of subsequent O&M operations.
HFCL will be executing this project in partnership with JWIL Infra Ltd., which specialises in water management projects.
In its stock filing dated 27th November 2022, HFCL stated that this project will be executed within 18 months. Once the project is built, the company will be providing one-year warranty support for it.
Varanasi Rural Water Supply Order to Increase HFCL’s Revenue and Profitability
HFCL stated that this order will contribute to its revenue and profitability. The company has stated in its earnings call for the financial quarter ended 30th September 2022 that its order book stood at Rs. 5,280 crore. HFCL reported a profit before tax (PBT) of Rs. 113.81 crore during Q2 of the ongoing financial year, out of which turnkey contracts and services accounted for Rs. 68.62 crore, which is about 60% of the total PBT.
Talking about the company’s order book, Mr. Mahendra Nahata, Managing Director of HFCL said, “This [the company’s orders] comprises of government and non-government both. Almost 55% is government, 45% is non-government.”
About HFCL: HFCL was founded in 1987, and has its headquarters in Delhi. It caters primarily to the communication sector through OFC and transmission & access equipment manufacturing. HFCL has OFC manufacturing facilities in Goa and Hyderabad. HTL Limited, the company’s subsidiary, also has an OFC manufacturing plant in Chennai. The company has a Cable Reinforcement Solutions Plant in Hosur, Tamil Nadu.