Beneficial interest AvH: 50%
AvH Contact: John-Eric Bertrand
OQM was operating three quarries at the end of 2016: in Mau and Bilaua (in the Gwalior region in northern India) and in Bidadi (southern India). Aggregates from OQM’s quarries in northern India are used for large infrastructure works such as highways, railways and racing circuits. The Bidadi quarry focuses primarily on the market of ready-made concrete and real estate projects.
2016 was a challenging year for OQM. The decision of the government to replace banknotes slowed down building activity. This had a knock-on effect on the demand for aggregates in the various regions, particularly during the fourth quarter of 2016. In Bidadi, demand also suffered considerably from the lack of new real estate projects. Mau and Bilaua were affected by certain changes in the regulations governing the mining industry, which led to a temporary closure of all plants in the Bilaua area. Nevertheless, OQM realized a turnover of 9.5 million euros in 2016. AvH recognized a goodwill impairment on its interest in OQM against the 2016 result.
The industry expects a vigorous recovery in the demand for infrastructure as the government’s tax revenues increase in 2017 and the government implements its plan to stimulate public spending. The demand for aggregates is expected to increase in 2017 throughout the country, fuelled by the start of several highway projects. The gradual decrease in mortgage rates at the beginning of 2017 should also create fresh demand on the housing market.