Megha Engineering & Infrastructure Limited (MEIL) company that started as a small fabrication unit in 1989 has now bagged projects worth Rs 1.87 Lakh crores as on 31 September 2023 with a revenue of mere Rs 35000 crore in FY 23, as per CRISIL’s report. But the sources in the industry have told Megha Watch that the actual worth of projects bagged by the company is around Rs 3 lakh crore.
The question remains – how will a company with such less revenue complete such big work orders?
Sources have also confirmed that MEIL intentionally prepared the lowest bid to procure the government project. After securing the project, MEIL had conspired with the babu (bureaucrats) involved in the project to increase the cost of the same project. As a result, more eligible companies with better infrastructure failed to get projects for being comparatively a higher bidder.
MEIL was a little-known infrastructure company before March 2024. The company captured headlines after the Electoral Bonds data was released by the State Bank of India that showed that MEIL was the second largest donor of bonds. Media has reported several instances wherein the company had made donations through bonds close to the date of securing the government projects.
What’s the secret behind MEIL’s success in pocketing massive government projects? Maintaining good relationships with all the political parties is MEIL’s key to success. The Kaleshwaram project in Telangana, Polavaram project in Andhra Pradesh, Zojila tunnel in Jammu and Kashmir, Thane-Borivali tunnel project in Maharashtra (after beating L&T for this project) and Tuticorin-Nagai Thermal Power Plant in Tamil Nadu are some of the big and at the same time controversial projects.
The company has been awarded projects by 20 states and two Union Territories in sectors such as irrigation, drinking water, Highways, tunnels, ports, railways and power.
Some of the big ticket projects as per media reports are –
- Kaleshwaram Lift Irrigation Project – Rs 1.15000 crore.
- Thane-Borivali twin tunnel project – Rs 14,400 crore
- Mongol Refinery – Rs 5,500 crore
- Contract to supply 47 oil rigs to ONGC – Rs 6,000 crore
- Zojila Pass project – Rs 4,700 crore
- Construction of the Polavaram multipurpose irrigation project – Rs 4,358 crore (approx)
- Construction Bandra – Rs 3,681 crore
History of the company
Hyderabad-based businessman P Pitchi Reddy (PP Reddy) grew up in a farming family. He started Megha Engineering Enterprises in 1989. In the beginning the company built pipelines for municipal projects. PP Reddy’s nephew PV Krishna Reddy joined the business in the early 90s. A new company was incorporated as Megha Engineering & Infrastructure Limited in 2006. PP Reddy is now the chairman and PV Reddy is the managing director.
As per local media reports in Hyderabad, the uncle-nephew do not share a cordial relationship anymore, suggesting rift between the duo. As reported in the Moneycontrol’s article, an ongoing clash between the two has resulted in an arrangement where the founder PP Reddy will exit the company after PV Reddy pays him Rs 14,000 crore in three years. The company has not made any comments on this.
The company has over 40,000 employees with operations spanning in 20 countries. The company has bagged 359 domestic and 4 international businesses in Zanzibar, RWANDA and Tanzania.
The further breakup of the domestic projects show – 43 projects in transportation, 36 projects in Heavy Engineering, 2 projects in Defence -Civil works, 93 projects in Irrigation, 28 projects in Power-Transmission, 81 projects in Water, 28 projects in O&M of Projects-Water, 17 projects in Buildings and Industrials infra, 21 projects in Hydro-Carbons and 10 projects in Renewable Energy.
Sources have told Megha Watch that due to lack of infrastructure, MEIL has failed to deliver at least 90% of the projects on time resulting in the increase of the cost of the project, in other words, loss of exchequer’s money. Close proximity with political parties and politicians has helped MEIL in getting away with the delays in delivering the projects.
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