Tata Projects Ltd, a pure-play EPC player with a predominant focus on industrial projects, formally announced its strategic partnership with Australia-based Brookfield Multiplex (BM), at a press briefing in Mumbai. The tie-up with BM is to take forward the diversification of Tata Projects in the urban infrastructure space.
Addressing the media, Vinayak Deshpande, Managing Director, Tata Projects Ltd, explained that the company entered the building segment around 18 months ago, diversifying from its traditional industry-centric portfolio that included power, roads, oil and gas, metallurgy etc. “The partnership is for premium quality buildings in the social infrastructure space,” noted Deshpande.
The two partners have already started bidding for building projects and even have an order pipeline of Rs.1,600 crore. Giving more details on the partnership, Desphande explained that no new joint venture company will be formed and the two partners will jointly bid for selective projects. There will be no infusion of fresh equity with human capital largely representing the contribution of the two partners, noted John Flecker, CEO, Brookfield Multiplex Australasia. Private sector projects, and not government projects, will be the key opportunity area, Flecker observed.
Discussing the strengths of Brookfield Multiplex in the construction space, John Flecker noted that his company was present in eight countries including Australia, UK, India and Middle East. BM has completed 900 projects globally, primarily on the building side, with a total construction cost of $60 billion. “Our speciality is high-rise and complex buildings and this is what we will be bringing to the Indian market,” Flecker noted. He also explained that since labour costs were high in Australia, Brookfield Multiplex has devised designs and techniques that minimise labour requirement, thereby making construction cost-efficient. Safety and quality represent the key characteristics of Brookfield, which is why the company has a significant flow of repeat orders. John Flecker highlighted that 50 per cent of Brookfield’s work order comes from 10 per cent of the client base, implying strong presence of repeat orders.
In home country Australia, Brookfield has built some signature projects including Prima Pearl, an 80-storey tower in Melbourne and the Brookfield Palace in Perth. The JW Mariott Marquis in Dubai is amongst Brookfield’s key projects in the Middle East.
Meanwhile, the partnership has already won a series of projects including Tata Medical Centre in Kolkata, five commercial office SEZs under a construction-management arrangement in Gurgaon and Kolkata; and a five-tower residential project, Mantri Serenity, in Bengaluru.
Glenn Raphael, Managing Director of Brookfield Multiplex in India, said, “We are committed to introducing world-class sustainable working practices to the Indian building construction market.”
Vinayak Deshpande explained that Tata Projects’ exposure in the urban infrastructure space includes commercial building, airports and even metro rail projects. However, the partnership with Brookfield will focus on commercial buildings. Summing up the partnership, John Flecker said that the association would bring together four decades of supply chain management expertise of Tata Projects and Brookfield’s 50 years of experience in safe, quality and time-bound construction. The result would be the introduction of end-to-end world class solutions to the Indian building construction space, Flecker concluded.
|Tata Projects: Order book|
The outstanding order book position of Tata Projects stood at Rs.14,000 crore as of March 31, 2015. In FY15, fresh order inflow of Rs.3,000 crore was booked. Apart from this, TPL is currently at L1 position in orders worth Rs.3,000 crore. This would ultimately translate to fresh orders in course of time. In the urban infrastructure space, an important recent order was that for building a 9-km elevated viaduct for the Delhi metro rail project (phase-III).