After a difficult phase through the last few years, realty major Unitech has recalibrated its strategy and is focusing on delivery capability.
"Clearly, we are operating in difficult times. However, being in business for over four decades in India, I have seen worse times. I remain confident of the potential of India," Chairman Ramesh Chandra said in the company's annual report for 2012-13. He added the real estate sector had immense scope for growth.
The company's managing director, Sanjay Chandra, who is undergoing trial in the 2G telecom spectrum case, is currently out on bail.
When A Raja was the telecom minister, the company's subsidiary Unitech Wireless had bagged licences to offer telecom services in 22 circles. Later, it had a joint venture with Norway's Telenor, though the partnership was called off after Sanjay Chandra was named an accused in the 2G case. The Central Bureau of Investigation had alleged Raja had distributed licences at a throwaway price of just Rs 1,651 crore and new companies had sold equity to foreign players at a much higher price, after securing the licences.
In 2012-13, Unitech has settled all disputes with Telenor and exited the telecom business. This enabled it to focus on the real estate business.
"In the last few years, we have gone through some of the most turbulent times in our history. As we emerge out of it as a more focused organisation with a clear strategic path, I urge you to continue to repose faith in the organisation. You are our strength," the chairman said.
The company's non-real estate businesses delivered good results in 2012-13. Unitech Power Transmission, engaged in transmission towers, recorded 33 per cent growth in revenues, with an improvement in profitability.
Through Unitech Hospitality Ltd (UHL), the company started food courts in the office complexes developed by it in Gurgaon, Noida and Kolkata.
In its first year of operations, UHL generated revenues of Rs 7 crore. In 2012-13, the property management business registered growth of 8.7 per cent, with a turnover of Rs 128 crore.
The company has taken various steps to enhance delivery capability. "First, we have restructured and strengthened our project management division. Second, we have invested in increasing the strength and capabilities of the construction division, which is handling about 20 per cent of Unitech's construction activity. We expect this to increase further this year," Ramesh Chandra said. Procedural delays and inertia in decision making have hit projects in the infrastructure and real estate sectors.