NAGARJUNA CONSTRUCTION COMPANY

Introduction
Nagarjuna Construction Company limited is a construction and
infrastructure enterprise which establish on 22 nd March 1990. Nagarjuna
Construction Company was hailed as best under a billion in Asia pacific.
The NCC business division are categorised as building and housing,
electrical, transportation, irrigation, water and environment, metal and
oil.The

offices

of

the

company

located

in

Ahmedabad,

Delhi,

Bhubaneshwar, Chennai, Kolkata, Bhopal, Bangalore. Its international

offices are in Dubai (UAE) and Muscat.

The company also adopts NBS

cellular system which was developed in collaboration.

"Intro of the company" 21th october 2015 <http://www.indiainfoline.com/markets/company/background/company-profile/nccltd/2598>.

ISSUES AND CHALLENGES FACED BY COMPANY.

Nagarjuna Construction Company limited had the problem with their
interest cost as their interest cost where high as RS 100 crore per quarter
as compare to Rs 180 crore annually over 3 year ago. The high inflation,
delays in receipt of dues from customer attributes to the company.The
company has consolidate debt of around RS 5,000 crore which had to
consolidated

revenue

of

March

31,

2012

of

RS

6665

crore.

The company says it is looking to reduce its debt burden through the sale
of its stakes in a couple of build-operate-transfer (BOT) projects. "We are
planning to exit two of our five road projects," confirmed A.A.V. Ranga
Raju, the company's Managing Director. The interest burden was not the
specific problem to Nagarjuna Construction Company but the capital
intensive project hurt in between.
"Issues

and

challenges

"

21th

october

2015

<http://www.businesstoday.in/opinion/perspective/ncc-debt-concernsinfrastructure-gmr-gvk-lanco/story/189929.html>.
Some of the projects problems are due to their nature long term and,
consequently expose to a variety of implementation risks, including
construction delays, delay or disruption in supply of raw materials, delays
in acquisition of land, unanticipated cost increases, cost overruns and
disputes with our joint venture partners.
The demand for our infrastructure development services is dependent on
the level of domestic, regional and global economic growth and
international trade. As such, the company is weak to general economic
downturns.

The

industry

is

also

directly

affected

by

changes

in

Government spending and capital expenditures by our customers.

On March 31, 2014, the company ordered book was ` 209,560 million.
Order book refers to expected future income under signed contracts or
contracts, where binding letters of intent or letters of award have been

received. Order book projects represent only business we consider to be

firm, although project cancellations or scope adjustments may occur from
time to time due to either a clients or our default, incidents of force
majeure or legal impediments.

The problems like.

acquiring land;
securing right of way;
clearing forests;
supplying material to the contractors is to be supplied by owners;
securing required licenses, authorisations or permits;
making advance payments or opening of letters of credit;
approving supply chain vendors; and
shifting existing utilities. Were faced by the conmpany.
http://ncclimited.com/images/PDF/Rights%20Issue%20LOF%20-12-09-2014.pdf

Methods to solve the problems:

The

government had initiated the programmes

to

overcome the

infrastructure constraints, due to this there is an increase in infrastructure

spending. As the government spending in 2012 and 2013 was 7100 billion
and

6200

encouraging

billion

in

private

infrastructure
sector

to

construction.

participate

Also

through

government

public

private

partnership project.
According to Nagarjuna Company, their experience of 36 year in various
sector such as infrastructure sector, electronic sector, transportation
sector water sector etc. had develop the expertise in projects.
To repair, build, erect, houses, apartment and maintain building,
apartment, multi-storeyed, complexes, landscape, road path, highway,
port, bridges and to do other similar construction, construct and repair
railway, canal, docks. To maintain all kind of iron and assessor to
investigate into the condition of building and other structure of all kind.
To purchase, acquire, take or in exchange or in any other lawful manner
any area, land,

buildings, structures

and to turn the same into account, develop the same and dispose of or
maintain the same and to build markets, or other buildings, and to equip
the same or any part thereof with all or any amenities or conveniences,
drainage facility, electric, telegraphic, telephonic, television installations
and to deal with the same in any manner whatsoever.
Nagarjuna to enter into any arrangement, agreement, lease, sublease
with

Department

and

undertakings,

municipality,

local

authority,

company, firm, partnership, person or persons, individual or individuals, in

furtherance of any objects of the Company, it act as a contract engineer,
architects,
engineer.

civil

engineers,

designers,

founder,

painter,

consulting

Nagarjuna ltd had decided to manufacture and deal in construction

material which include cement, aluminium, steel, construction equipment,
building components such as window, door, ventilator, etc. made of any
material.
To carry on in India or elsewhere the business to generate, receive,
produce, improve, buy, sell, resell, acquire, use, or otherwise to deal in
electric power in all its branches of such place or places as may be
permitted by appropriate authorities by establishments of thermal power
plants or invested in future.
http://ncclimited.com/images/PDF/Rights%20Issue%20LOF%20-12-092014.pdf

REASONS FOR THE PROBLEMS:

Nagarjuna is now innovative to solve day to day problems. Its improving
in its quality of product which reach to its end consumer and also it
service. The company improve on its planning as their plan are based on
annual sales plan. It also plan for primary transportation and the
secondary transportation, repacking, storage etc.
Sometimes the delivery create the problems as the company new mantra
is to deliver the thing at right quality, right place, and right quantity and
at right time.
The company management who handle the transportation management
and the risk of the various activity and the improvement in the supply
chain management and its process so that problem doesnt occur.
As the cost of competitions also high the company faces the problems and
the team work in the organization which handle the suppliers and the
vendors.
The approval from the government for acquiring of the land create the
majors problems for the company as the need of it was more.

http://www.nagarjunafertilizers.com/company-policies/Policy%20on
%20Supply%20Chain%20Management.pdf

CONCLUSION:
Being part of the society has been the root of the Nagarjuna ltd. As the
industry motto is to serve the society through the industry. Whatever
challenges the company faced beyond of that the industry want to be the
part of society which espouses that their practices be at concord with
legal and societal mores.