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Projects Stalled in Q3/FY19

Stalled projects in Manufacturing declined

The declining trends in stalled projex, observed in the past quarters, continued in Q3/FY19 too. During the quarter ended December 2018, 160 projects with committed investment of Rs 76,304 crore were stalled by promoters. In the preceding quarter, 135 projects entailing a total investment of Rs 93,300 crore were stalled.

In the quarter ended September 2018, the private sector accounted for 82 percent of the total projex shelved. The sectors’ share came down sharply to 49.5 percent in Q3/FY19. In all, 119 private projects worth Rs 37,774 crore were put on the back burner by private promoters.

Among major sectors, the share of the Manufacturing sector in total projex stalled came down from 30 percent in Q2/FY19 to 23 percent in Q3/FY19. On the other hand, the shares of the Electricity sector increased from 46.4 percent in Q2/FY19 to 49.4 percent in Q3/FY19 and that of the Infrastructure sector jumped up from 22.2 percent in Q2/FY19 to 27.3 percent in Q3/FY19.

A bulk of the projects lost in the Manufacturing sector was accounted by 21 steel projects worth Rs 13,517 crore. This included four mega steel projects of Visa Steel, Super Smelters, Rungta Mines and Accil Steel & Tubes. Another mega project stalled in this sector was Rs 1,000 crore smartphone manufacturing project of Intex Technologies.

The Electricity sector lost 38 projects worth Rs 37,678 crore. Of the 22 hydel power projects shared, two projects of Bhilwara Energy and NSL Renewable Power were worth Rs 1,000 crore each.

In the Thermal Power sector, all the six projects stalled were of mega size. Dahej coal-based power project of Adani Power and Gajamara coal-based power project of NTPC involved an investment of Rs 14,000 crore each.

In the Infrastructure sector, 54 projects worth Rs 20,849 crore were shelved by their respective promoters. The Rs 9,000 crore Dahanu port project of Vadhavan Port, the Rs 5,830 crore Perur desalination project of the Chennai Metropolitan Water Supply & Sewerage Board and the Rs 3,000 crore Chembur-Wadala-Jacob Circle Monorail Project of MMRDA were the mega projects shelved in this sector.

Odisha, Gujarat and Maharashtra were the biggest losers among the states. While Odisha saw 9 projects worth Rs 17,145 crore being put on the back burner, Gujarat lost 28 projects worth Rs 17,075 crore. Maharashtra saw disappearance of 30 projects entailing a total projex of Rs 13,867 crore.

Projects Completed in Q3/FY19

The pace of completion slowed further

The rate of project fructification slowed down further in Q3/FY19. A total of 151 projects worth Rs 67,341 crore were commissioned in the three months ended December 2018. Generally, information on completed projects, especially of medium and small size, comes with some time lag. Nevertheless, the figures indicate a sharp fall in the number of projects commissioned.

The Services & Utilities (Infrastructure) sector accounted for three-fourth of the projex fructified during Q3/FY19. In all, 107 projects worth Rs 44,713 crore were commissioned in this key sector. The Rs 13,845 crore Bangalore Metro Rail Project, the Rs 5,820 crore Bogibeel Rail-cum-Road Bridge Project and the Rs 1,892 crore Kannur International Airport Project were the three major projects commissioned in the infrastructure space during Q3/FY19.

Within the infrastructure segment, the Roadways sector saw completion of 23 projects worth Rs 8,121 crore during Q3/FY19. The Rs 812.59 crore Babatpur-Varanasi highway, the Rs 725 crore Rani Jhansi-St. Stephen’s Hospital road and the Rs 588 crore Ranchi Ring Road were the three major roadways completed during Q3/FY19. Two mega railway projects — the Rs 13,845 crore Bangalore Metro Rail Project [Phase I] and the Rs 5,820 crore Bogibeel Rail-cum-Road Bridge Project were commissioned in this quarter.

In the Manufacturing sector, 38 projects with a total projex of Rs 11,634 crore were commissioned in Q3/FY19. In the preceding quarter 104 projects worth Rs 9,573 crore were commissioned. Of the 38 commissioned projects, only three were of mega size. They were Chambal Fertilisers’ Rs 5,800 crore urea project at Gadepan, Bhilosa Industries’ Rs 2,500 crore polyester texturised yarn project at Naroli and Ceat Ltd’s Rs 1,000 crore radial tyres project at Halol.

The Power sector reported completion of only four projects. Of the four, the Rs 8,000 crore Sidhi coal-based power project of Essar Power MP was the largest.

The Rs 1,200 crore Bengaluru office complex project of Goldman Sachs Services, the Rs 1,500 crore IT City project of Vamasundari Investments and the Rs 1,400 crore IT Park of the LuLu Group International were the other prominent projects fructified in the Infrastructure sector.

Among the states, Karnataka saw commissioning of 18 projects worth Rs 15,706 crore. The state accounted for around 23 percent of the total projects completed in Q3/FY19. Madhya Pradesh, Rajasthan and Gujarat were the other states where a good number of projects were completed.

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