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Infrastructure

NHAI is selling two toll-road bundles, but investors are wary of making big-ticket payments upfront

Short of funds for the ambitious Bharatmala project, the NHAI is inviting bids for the tolling rights of 16 road assets. But in a market overcrowded with assets on sale and subdued road-traffic growth, institutional investors are unlikely to share the road authority’s exuberance and may not want to make a large-ticket payment upfront.
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priyanka
7 Nov 2019 5 Mins Read 1 comments
Vehicles pass through the Delhi-Noida-Delhi flyover, which was made toll-free in 2017. Getty Images
Vehicles pass through the Delhi-Noida-Delhi flyover, which was made toll-free in 2017.
Highway-construction company IRB Infrastructure reported toll revenues of INR918.2 crore at the end of FY19, which came from a single project — the Mumbai-Pune Expressway. While the amount itself is hefty, the project becomes an even more impressive investment for the company, considering a year’s toll collection on a 94.5km, six lane-expressway was enough to recover the upfront payment
a calculated gamble and NHAI’s leniency in accommodating a quote even if it is slightly less than the base price. After all, the traffic growth across highways has decreased to 4% from 7%-8% a year ago and assets on sale from debt-laden private developers like Essel Infraprojects and IL&FS are also crowding the market. ( Graphics by Mohammad Arshad)
Highway-construction company IRB Infrastructure reported toll revenues of INR918.2 crore at the end of FY19, which came from a single project — the Mumbai-Pune Expressway. While the amount itself is hefty, the project becomes an even more impressive investment for the company, considering a year’s toll collection on a 94.5km, six lane-expressway was enough to recover the upfront payment a calculated gamble and NHAI’s leniency in accommodating a quote even if it is slightly less than the base price. After all, the traffic growth across highways has decreased to 4% from 7%-8% a year ago and assets on sale from debt-laden private developers like Essel Infraprojects and IL&FS are also crowding the market. ( Graphics by Mohammad Arshad)

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