Confident of achieving target for FY20 despite COVID crisis: RITES CMD
RITES Limited’s CMD said that the PSU is confident of achieving the outlook given for financial performance of FY20 even amidst the COVID crisis
April 17, 2020
Mehrotra said that to the extent possible, RITES has tried to negate the impact through remote working
The overall impact on the future of the operations of the company and on our client, which may also affect us in turn, is not immediately assessable, he said
RITES Limited’s CMD (Chairman and Managing Director
) Rajeev Mehrotra said on Friday that the state-run company is confident of achieving the outlook given for financial performance of FY20 even amidst the COVID crisis. He said that there could be some impact on new orders and the collection performance, but no major effect on the top-line for the financial year.
“FY20 started well with strong business momentum, with key project wins and focus on timely execution. While the COVID 19 impact on Q4FY20 numbers is yet to be quantified, we do not expect it to be significant on the top-line for the financial FY20. We are confident of achieving the outlook given for financial performance of FY20, but some impact can be felt on the new orders and collection performance, as the last month of the financial year plays an important role towards improving collections.”
COVID crisis: Early assessment of impact on RITES business
Mehrotra said that to the extent possible, RITES has tried to negate the impact through remote working. “In a major export order from Africa in which RITES had emerged as a successful bidder in February 2020, final price negotiations for export value of $89.2 million (Rs 678 crore approximately) have been concluded during the lockdown period through video conferencing. The contract documentation is likely to be completed soon,” he added.
“Besides this, the RITES order book is robust with projects which are expected to be executed in the next one-two years. Soon after normal working is possible in our operations, we will attempt to reach full capacity at the earliest, as most of the engineering work by the company is done by in-house teams,” the CMD said. “We are also hopeful that the fixed cost during the lockdown period can be largely recovered in the remaining part of the year and savings through cost reduction wherever possible,” he added.
‘Employees being encouraged to work from home wherever possible’
Commenting on the impact of the COVID crisis on the everyday functioning, Mehrotra said, “We are trying our best to minimise the COVID 19 impact on the company. Employees are being encouraged to work-from-home on pan-India basis, except those handling essential services. Our investments in digitisation through ERP, e-office, e-tendering etc are helping us to shift some of our operations to remote working environment, thus, keeping employees’ safety as top priority during this crisis.”
“RITES is committed to the welfare of the society and in this emergency situation has contributed Rs 16 crore to the PM-CARES fund. Its employees have also volunteered to contribute two-day’s pay for April. Given the uncertainty, the overall impact on the future of the operations of the company and on our client, which may also affect us in turn, is not immediately assessable. Our business model will help us to navigate through these difficult times and it gives us the confidence to emerge stronger soon,” Mehrotra said.