irb infrastructure developers ltd is an indian highway construction company headquartered in mumbai .

it is part of the irb group .

irb infrastructure , which executed the country 's first build-operate-transfer ( bot ) road project , is one of the largest operators of such ventures .

currently it has about 3404.40 lane km operational and about 2330.4 lane km under development .

among its notable projects are the mumbai pune expressway and the ahmedabad vadodara expressway in 2012 , irb acquired tamil nadu based bot road builder mvr infrastructure and tollways for ₹ 1.30 billion .

irb infrastructure

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irb infrastructure owner virendra mahiskar has india ' s prime bot projects worth capital is rs . 6 , 150 , 000 , 100 . irb infrastructure ltd is an indian highway construction company . irb infrastructure grows 3 % from the toll roads .
virendra mhaiskar , irb infrastructure owner looks to capitalize the whole framework of business .
at its board meeting held on monday , irb infrastructure developers ( irb ) has approved adding another road project to the company - promoted infrastructure investment trust ( invit ) .
road developer irb infrastructure developers ltd has won a rs 10 , 050 - crore . . .
the company history page lists out the major events in chronological order for irb infrastructure developers ltd .
mumbai : roads developer irb infrastructure developers ltd on tuesday said it plans to raise rs5 , 035 crore from listing of its infrastructure investment trust ( invit ) , irb invit fund , to unlock value from certain operational assets .
irb infrastructure’s spv achieves financial closure for rs 2 , 088 - crore highway project on rajasthan - gujarat border .
irb infrastructure developers ltd . is a widely known and trusted name in the construction and infrastructure sector . the company was incorporated to fund the capital requirements of the irb group initiatives in the infrastructure sector . since its inception , the company has attained commendable success and established benchmarks of excellence in its sector . it undertakes development of various infrastructure projects in the road sector through several special purpose vehicles . about irb :
irb infrastructure has transferred 100 % ownership in six of its operational road projects spanning 700km under the invit . photo : hindustan times
irb infrastructure , on wednesday , said it acquired 100 per cent stake in road bot ( build - operate - transfer ) firm mvr infrastructure and tollways in tamil nadu for about rs . 130 crore .
the six project entities that form part of the initial portfolio of the invit have been transferred from the bot assets . the projects comprises of idaa infrastructure pvt ltd , irb surat - dahisar tollway private ltd , irb talegaon amravati tollway pvt ltd , irb jaipur deoli tollway pvt ltd , irb tumkur chitradurga tollway pvt ltd and m . v . r infrastructure and tollways pvt ltd .
irb infrastructure developers ltd . was incorporated to fund the capital requirements of the irb group initiatives in the infrastructure sector . the company undertakes development of various infrastructure projects in the road sector through several special purpose vehicles . ( businesses of holding co . and its subsidiaries will be implemented under superintendence , direction and control of the board of holding company , with the objective of maximizing value for all stakeholders . )
other awardees at the event included irb infrastructure , tata projects , itd cementations , jusco ltd , il & fs , reliance infrastructure , caterpillar cargo , et al . the lifetime achievement award went to dr . gvk reddy , founder chairman and md , gvk group .
gadkari dismissed the allegations as “completely false” and said the ministry followed a transparent e - tender system . he also denied that his son was a director in irb infrastructure developers .
irb infrastructure developers ltd . , incorporated in the year 1998 , is a mid cap company ( having a market cap of rs 7443 . 71 crore ) operating in construction sector .
irb has received rs 1 , 700 crore as consideration from the invit and irb continues to hold 15 per cent of the unit capital of the invit .
the organizing committee and jury of the epc world group unanimously recognized adani institute of infrastructure management ( aiim ) with industry honor for its academic contribution in the infrastructure and construction sector as “emerging institute for infrastructure management” in special achievements category during the 6th edition of epc world awards at the ashok hotel , new delhi .
irb infra closes below 150 - day moving average of 235 . 21 today .
irb infra closes above 150 - day moving average of 235 . 41 today .
irb infra closes above 200 - day moving average of 230 . 21 today .
virendra mhaiskar is the owner of irb infrastructure which is a public incorporated on 27 july 1998 . the company along with its subsidiaries is engaged in the construction , development and maintenance of road .
jamshedpur , jan . 23 : at the 6th epc world awards , in the infrastructure category , jusco got an award for outstanding contribution in urban infrastructure for water supply and recycle & reuse of treated sewage project at jamshedpur .
incorporated in the year 1998 , irb infrastructure developers ltd is india’s leading and one of the largest private roads and highways infrastructure developers in build - operate - transfer ( bot ) space . the company carries out engineering , procurement , construction ( epc ) as well as operations and maintenance activities in - house .
toll road firm irb infrastructure developers has received a contract worth rs 2 , 100 crore from the national highway authority of india ( nhai ) for a six - lane project in rajasthan and gujarat .
according to pti , gadkari dismissed the allegations as “completely false” and said the ministry followed a transparent e - tender system . he also denied that his son was a director in irb infrastructure developers .
the advantage of invit – given the challenging phase of infrastructure , invits provide a suitable structure for financing or refinancing of infrastructure projects in the country . invits are designed to attract low - cost , long term capital and the underlying focus is to reduce the funding pressure on the banking system as well as generating fresh equity capital for infrastructure projects .
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irb infrastructure developers ltd . office no . 11th floor / 1101 , hiranandani knowledge park , technology street , hill side avenue , opp . hiranandani hospital , powai , mumbai – 400 076 cin : l65910mh1998plc115967
mumbai : irb infrastructure developers ltd , which recently won the bid to build south asia’s longest tunnel road in jammu and kashmir , said on tuesday the government has cancelled the award without mentioning any reason .
irb infrastructure developers ltd . on wednesday said its special purpose vehicle ( spv ) , udaipur tollways , has achieved financial closure for rs 2 , 088 - crore highway project on rajasthan - gujarat border .
we are a leading epc company , offering end - to - end solutions in infrastructure , transportation and industrial projects .
investors with a long - term perspective can buy the stock of leading road developer irb infrastructure developers . the company’s order book has been growing at a healthy pace and earnings growth has revived in recent times .
awards and achievements irb infrastructure developers limited , an integrated infrastructure construction and development company in india has been conferred with the cnbc tv 18 essar steel infrastructure excellence award in the highways & flyovers category . it is the second consecutive year that the company has been honored with this award . mr . virendra d . mhaiskar , chairman & managing director of irb , bagged the “young turk of the year” award at the 6th edition of cnbctv18 india business leader awards presented by honorable finance minister , shri pranab mukherjee on 11th december 2010 at mumbai .
irb approved selling 100 per cent equity stake in irb pathankot amritsar toll road pvt ltd — a special purpose vehicle ( spv ) managing the pathankot - amritsar section of nh - 15 in punjab to irb invit fund , which already has six road assets listed under it .
irb infrastructure developers ltd . key products / revenue segments include contract revenue which contributed rs 3412 . 54 crore to sales value ( 100 . 00 % of total sales ) for the year ending 31 - mar - 2017 .
three days after toi exposed the controversial dealings of bjp president nitin gadkari , eyebrows are being raised over the exponential growth of ideal road builders ( irb ) , an infrastructure company set up by virendra d mhaiskar in 1977 .
except the invit assets , irb has reported toll collection for all of its projects . the toll revenue of irb has been impacted by gst resulting in overall traffic growth of 4 per cent for the portfolio excluding the invit assets . the impact of gst on irb infrastructure developer has reflected from the second half of the month of june 2018 and may persist till the second quarter of fiscal 2018 , resulting in muted toll growth .
“it’s certainly a loss of opportunity , ” virendra mhaiskar , managing director at irb infrastructure said over phone . “it’s negative in terms of order book but not in terms of financial impact because there was no investment made so far . ”
invits raise funds from a large number of investors and directly invest in infrastructure projects or through a special purpose vehicle . this long - term investment instrument aids the developers of infrastructure assets to monetise their assets by pooling multiple projects under a single entity within a trust structure .
udaipur tollway pvt . ltd . , a special purpose vehicle ( spv ) of irb . . .
the awards committee received nominations from over 250 companies for various categories , including giants of the infrastructure sector like bhel , bsnl , coal india ltd , tata group , adani group , reliance adag group , jcb , gvk group , gmr group , il & fs transportation networks ltd , sadbhav group , irb infrastructure developers ltd , ashoka buildcon ltd , jsw cement ltd and industry stalwarts .
udaipur tollway pvt . ltd . , a special purpose vehicle ( spv ) , has successfully achieved financial closure for its rajasthan - gujarat border six - laning bot ( build , operate , transfer ) project , irb infrastructure said in a bse filing .
irb infra q4 pat seen up 12 . 6 % yoy to rs 233 . 3 cr : icici direct
irb infra bagged the project last year by offering a premium of rs 163 . 80 crore to nhai .
bajaj consultants , based on the information provided by irb , prepared the business plan and future cashflow estimates for the promoter – ie , irb infrastructure developers ltd - on a consolidated level to estimate if irb could meet its commitment through its internal accruals . the estimates were prepared commencing from fy 2012 to fy 2021 , which covers the base year , the initial construction period of three years and the first six years of operation during which promoter funding is needed to cover negative cashflows . the projections to the comfort of the lenders showed that irb could comfortably meet its commitments for the construction and operational periods .
overseas infrastructure alliance ( india ) pvt . ltd . conferred the prestigious ' outstanding contribution in overseas infra project ' award at the 6th epc world awards 2017
an invit is mutual fund like institution that owns and manages income - generating infrastructure projects . it pools small sums of money from large number of investors and allows them to directly invest in infrastructure projects such as roads and power , and returns a portion of the income after deducting the expenses to the investors .
the 6th epc world awards committee received nominations from over 250 companies , including giants of the infrastructure sector like bhel , bsnl , coal india ltd , tata group ( tata projects , tata steel , jusco ) , adani group , reliance adag group , jcb , gvk group , gmr group , il & fs transportation networks ltd , sadbhav group , irb infrastructure developers ltd , ashoka buildcon ltd , jsw cement ltd and industry stalwarts .
the congress on monday alleged corruption in a rs 10 , 500 - crore contract awarded by ministry of road transport and highways , headed by nitin gadkari , to irb infrastructure developers ltd for construction of zojila pass tunnel project in jammu and kashmir , a charge the minister denied .
during may 2017 , the road infra - major launched and listed india’s first ever infrastructure investment trust ( invit ) . the company raised rs 5 , 035 crore through an initial public offering ( ipo ) of its invit . the company shall use about two - thirds , or up to rs 3 , 300 crore of the funds raised to repay the underlying debt associated and the balance will go the parent and sponsor irb infrastructure developer .
even after the rfq was again invited , only a single bid emerged . accordingly , wider participation was called . when the bid submission day was over in november 2015 , only one bidder participated . subsequently , bids were reinvited . irb infrastructure developers submitted the bid in december 2015 .
event : overseas infrastructure alliance ( india ) pvt . ltd . conferred the prestigious ' outstanding contribution in overseas infra project ' award at the 6th epc world awards 2017
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stock exchange of india , following reports in a section of the media . on the relationship between irb and gadkari , mhaiskar submitted that since irb infrastructure developers and its subsidiaries did not have any business relationship , past or present with gadkari , there was no question of any conflict of interest . on his investment in firms controlled by gadkari , mhaiskar said that irb made an investment of rs 1 . 85 crore in equity shares of ppsl mainly for good returns—besides , at the time of the investment , gadkari was not the public works minister .
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irb infrastructure developers ltd has achieved financial close with a debt tie - up of rs33bn for its rs48 . 8bn bot project of six - laning the ahmedabad vadodara section of nh8 and the improvement to the existing ahmedabad vadodara expressway . by rohin agarwal and nikhil maniar , senior associates , bajaj consultants pvt ltd .
these changes relate to pawar ' s shareholdings in two controversial firms in maharashtra - - mumbai - based irb infrastructure developers ltd and pune - based panchshil hotels pvt ltd , part of the panchshil group of companies which has been in the spotlight for its partnerships with the 2g spectrum scam - tainted db realty .
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irb infrastructure was the first road developer in india to launch an invit in may this year . the invit’s ipo that got oversubscribed 8 . 7 times raised ₹5 , 035 crore . taking to the invit route could help the company reduce its debt equity ratio to approximately 1 . 8 : 1 from 3 : 1 .
“with the new pathankot asset , it will get reduced further , ” sudhir hoshing , joint managing director , irb infrastructure , told businessline . he added that the invit has the capacity to double in size , allowing the promoter company to further reduce debt as well as fund new projects . although irb invit fund has been trading below the issue price of ₹102 a share since it got listed , the stock has been picking up slowly since the beginning of july . irb invit fund’s board will meet on wednesday to consider the new acquisition as well as declaration of the first dividend distribution for fy18 .
overseas infrastructure alliance ( india ) pvt . ltd . was conferred with the prestigious ' outstanding contribution in overseas infra project ' award at the 6th epc world awards 2017 in new delhi . the annual epc world awards , one of the most reputed award in its space , acknowledges the achievements of companies and individuals across the infrastructure , construction and real estate sectors in india .
the transaction is subject to approvals from concerned authorities . “if everything goes well , we expect to complete the transaction probably by end of next quarter , ” virendra mhaiskar , chairman & managing director of irb infrastructure developers said . mhaiskar was re - appointed as chairman & md for a term of five years with effect from september 7 .
“this is the first time that any company has acquired a road bot company . going forward , we will continue to look at such opportunities , ” irb infrastructure chief financial officer anil yadav told pti here . “at present , there are almost 40 - 50 road bot projects up for sale . we are looking at all opportunities for growth . ”
irb have successfully executed numerous bot projects in roads and highways sector , including augmentation of the national highways and sections of the golden quadrilateral . irb developed the nation’s first ever bot project ( thane bhiwandi bypass ) . irb group have one of the largest bot portfolios ( operational projects and projects under construction ) in the country with a total length of around 10 , 036 lane kms . they have a share of 13 . 17 % in the golden quadrilateral .
irb said it will use about rs3 , 300 crore of proceeds to repay underlying debt associated with the assets and the balance to pay back sponsor debt .
it also mentioned irb ' s construction order book to stand to around rs . 10 , 000 crore , which would be executed in the next four years .
virendra , on forbes india’s list of 100 richest indians , is chairman of irb infrastructure , a company that has slowly made its mark as a developer of integrated bot road projects . the younger brother jayant is managing director of mep toll road ltd , where dad dattatray is chairman and chief mentor . the privately - held mep toll is focused on toll collection ( toll - plazas ) and maintenance of roads . his most high - profile contract ( with maharashtra state road development corporation ) is to toll mumbai’s five entry points and maintain 28 flyovers and allied infrastructure , for the next 14 years .
the epc world awards are presented annually by epc world media group in association with zee business channel as media partner . the awards acknowledge the achievements of companies and individuals across the infrastructure , construction and real estate sectors .
the construction ( epc ) business on standalone basis is valued at rs 125 per share or 4 times its expected earnings of enterprise value - to - ebitda . this is 50 per cent discount to peers as irb largely executes captive bot orders and in an event of slowdown in bot project awards , irb may get negatively impacted .
on the other hand , irb’s second - largest tollway , ahmedabad –vadodara project is facing traffic diversion to completing state highway and irb has sought relief from nhai . consequently , the company has filed a claim with government agencies for rs 170 crore as compensation from dec - 15 onwards and has asked nhai to take up issue with gujarat state government .
the core strength of irb lies in its ability to execute bot road and highway projects , including sections of the golden quadrilateral and the national highways . mumbai - based , irb developed india’s first ever bot project : thane - bhivandi bypass and has one of the largest bot portfolios including both operational projects and projects under construction in the country with a total length of around 12000 lane kilometers . at present , under the bot division , irb is operating and maintaining highways with length of more than 8000 lane kms across india .
addressing reporters at the congress headquarters , singh claimed gadkari had close links to the mhaiskar family , promoters of irb group . “in the past , they have invested crores in companies of gadkari family and nikhil nitin gadkari , son of nitin gadkari , was shareholder and promoter director in ideal energy projects ltd of irb group , ” he wrote in his letter to the pm .
during the first quarter , the epc business of irb witnessed 45 per cent revenue growth on year on year basis . this robust growth is led by strong execution in five under construction projects .
the award was presented to mr . chander shekher gupta , advisor – sales and marketing , overseas infrastructure alliance ( india ) pvt . ltd . by dr . mahendra nath pandey , union minister of state for human resources development and shri udit raj , member of parliament , in the presence of shri pratip chaudhuri , former chairman , state bank of india and shri tejasvi sharma , md and editor in chief , epc world media group at a glittering award ceremony attended by the who ' s who of the infrastructure industry .
the cbi , which is investigating the murder of rti activist satish shetty , carried out searches at the offices of irb infrastructure developers ltd , which has recently also been dragged into the controversy surrounding bjp president nitin gadkari . shetty , who was killed in january 2010 , had registered a complaint with pune ' s crime branch in his attempt to expose a land scam involving irb chairman virendra mhaiskar . while cbi officials remained tight - lipped about the searches on friday , sources said that various teams of the agency had swooped down on at least four of irb ' s offices in pune . shetty was killed on january 13 , 2010 outside his house in talegaon in pune . in 2009 , he had informed the pune police that mhaiskar had threatened him and his life was in danger . he had sought police protection too . the bombay high court had handed over the case to the cbi in october 2011 . shetty was working on documents supposedly to expose irb and its subsidiary companies that had staked claim to ownership of government land on the basis of fake documents that were approved by conniving bureaucrats . recently , the irb group was also mentioned in the gadkari controversy for huge unsecured loans it has doled out to gadkari ' s purti sugar and power ltd . activists allege that in return for these
loans
, irb was awarded plump contracts by the maharashtra government due to the influence of gadkari as a pwd minister .
this should continue , given the strong thrust to road projects by the government and the national highways authority of india ( nhai ) through key policy changes . irb as a major developer should benefit .
chairman & managing director of irb mr . virendra d . mhaiskar , is the chairman and managing director of the company . he holds a diploma in civil engineering from shriram polytechnic , navi mumbai . as a civil engineer , he has hands on experience of more than 25 years in the construction and infrastructure industry to his credit . he is responsible for developing new business , executing road construction and bot projects . he is providing overall vision and strategy to the company .
the major pain point for ahmedabad bot is rs 800 crore sub debt from irb , towards cash shortfall . irb is facing loss in traffic with competing stretch being upgraded by gujarat state . the company has raised the issue with national highways authority of india ( nhai ) and wants the authority to take up the issue under ‘state support agreement’ . the resolution for same is expected over next few quarters .
irb infra shares rose 3 . 16 % to close at rs254 . 60 on the bse tuesday , while the benchmark sensex rose 0 . 97 % to close at 29 , 943 . 24 points .
on 4 january , irb won the bid for an all - weather zoji la pass tunnel road , which was to connect srinagar to ladakh region that remains cut off during winters . at an estimated cost of
shri virendra d . mhaiskar , chairman & managing director of irb , was chosen as the “young turk of the year” at the 6th edition of cnbctv18 india business leader awards on 11th december 2010 at mumbai .
for the clearance of ethical issues in research related to animal and human subjects , cpcsea approved institutional animal ethical committee ( iaec ) and rdt hospital supported institution review board ( irb ) , have been established .
dr . diptiranjan mahapatra , head – academics , aiim was invited to speak at the event on “infrastructure outlook for 2017” . he elaborated , “while 2016 saw most of the policy interventions – hybrid annuity model , tot ( toll - operate - transfer ) , rera bill , larr 2013 , reits , invits , major port bill , revenue sharing in oil & gas , etc . – either in place or soon to be , 2017 should bring fruition to all these initiatives . eventually , what government has been and should be trying to do is to own the implementation risk i . e . the ‘build’ part and invite the private sector especially the infrastructure - focused funds and pension funds to do the manage part . additionally , the infrastructure sector should expect disruptions , especially in the epc space” . his speech was well received by the dignitaries and delegates in attendance .
the six operational assets have a proven track record of revenue and have shown a cagr ( compounded annual growth rate ) of 11 . 4 % , said virendra mhaiskar , chairman and managing director of irb infra .
irb is among the big boys in the road sector in the country . its portfolio of 21 bot projects ( 14 operational , six in construction phase and one won recently ) is among the largest in the country .
shri suresh prabhu ( hon’ble minister of railways ) and dr . narendra nath pandey ( hon’ble minister of state for human resource development : mos – hrd ) were chief guests at the event . dr . pandey , during felicitation ceremony , appreciated the efforts of the infrastructure industry towards nation - building .
irb has indicated it will be agnostic towards the type of contracts it will bid for , whether bot toll , bot annuity or ham , as long as it gets a competitive 18 per cent plus return on its investment .
irb contributions for the betterment of society a model irb primary school is being run by the company or the children of the village maalion ka jhopra at tonk district in rajasthan , where 271 children are being provided free education including uniforms and books . the company has also succeeded in encouraging girl children of the area for education . in a traditional and backward rural area of rajasthan , where educating a girl child is frowned upon , irb’s school has the distinction of having more girl students ( 141 ) than boys ( 130 ) students . the company is replicating the same model and starting a school in the pathankot district of punjab , near the amritsar - pathankot bot project .
for the nine months ending december 2015 , irb’s consolidated revenue grew 25 per cent year - on - year while profit grew 20 per cent . this is a strong revival from the performance in the period between 2013 and 2015 .
we , at irb , have been fully committed ourselves for growth of the organization ; the society and above all the nation . our projects , initiatives taken for the betterment of society , have portrayed our hard work and commitment .
given its track record of winning bot contracts and executing them well , the company can be reasonably expected to get a fair share of the upcoming projects over the next few years . the recent big win of the ₹10 , 000 crore plus zozila pass project in jammu and kashmir — irb’s first bot annuity contract — lends confidence . with this , irb’s order book stands at ₹17 , 320 crore — at 4 . 5 times 2014 - 15 revenue — that provides good construction earnings visibility .
in a stock exchange filing after market hours , irb said that it has received communication from the ministry “that they have decided to cancel the bid process for the project and cancelled the said loa ( letter of award ) without assigning any reasons” .
according to sources , national highways and infrastructure development corporation ( nhidcl ) had invited tenders for the zojila tunnel project , under the engineering , procurement and construction ( epc ) mode , for constructing a road between srinagar and leh - ladakh , which is covered in snow for most of the year , hence making the project strategically significant .
irb’s net debt - to - equity ratio is about 2 . 7 times as of december 2015 and interest cover was around 1 . 6 times . this is not too high considering the dynamics of the business and the high leverage of many peers .
the total debt of rs33bn was structured by bajaj consultants pvt ltd , which was the sole financial adviser for this transaction . this is the largest debt syndicated so far for a toll - based bot highway project in india . the scope and the structure of the deal present a vital insight into the emerging trends in the indian infrastructure space .
the concession awarded to the company is for a period of 25 years , which includes a construction period of three years . the section of nh8 between ahmedabad and vadodara is currently a two - lane facility . expressway ne1 is a four - lane facility that is already being tolled by nhai through tolling agencies . the tolling on ne1 would be taken over by irb from the appointed date , ie , immediately on takeover of the highway by irb , while that on nh8 would commence after the construction period of three years .
“there could be a knee - jerk reaction to the stock but there is no downside to the announcement , ” said a domestic brokerage analyst , asking not to be named as he is not authorized to speak to reporters . irb infra had a consolidated debt of
when irb infra went public in 2008 , dattatray and jayant mhaiskar got about 20 % in the company . irb was able to raise around rs 1 , 000 crore in what were the heydays for indian infrastructure companies . over the past four years , both have been offloading their stakes , and their share is now down to less than 2 % . over this period , virendra mhaiskar has been trying , quite unsuccessfully as it turns out , to dissociate from his brother . in repeated statements made to the media since 2009 , he has said that mep toll road is not a part of irb . but many still confuse the two entities . both , for instance , came under fire from raj thackeray ' s mns ( maharashtra navanirman sena ) in july this year , for not maintaining roads well , despite the toll collection being well above all estimates . mns workers had blockaded roads being tolled by both brothers . bankers lending to infra companies say they too were confused about the two in the initial period after the separation . differentiation between the two is now marked , and lenders have different risk perceptions of the two groups , they say .
after the transfer of six projects to irb invit , the company has substantially reduced its debt - to - equity to 1 . 8 : 1 as against 3 : 1 before the launch of invit . this would lead to up gradation of credit rating for the mumbai based developer .
there was extensive media coverage and industry news reports that road projects were being bid very aggressively , with developers offering high premiums to nhai . it was more pronounced for this project as irb bid a premium of rs3 . 09bn payable to nhai from the first year of the concession period against
irb saw a brief cooling period after the shiv sena - bjp government was voted out but it ricocheted back into the mainstream after gadkari was appointed advisor of the prime minister’s rural road development plan . the company then bagged major contracts not only in maharashtra but in bjp - ruled gujarat .
the invit trust for irb constitutes six operational road assets valued at rs 5 , 920 crore . the trust has 100 per cent ownership of these six completed toll - roads assets aggregating to approx . 4000 lane kms across the states of maharashtra , gujarat , rajasthan , karnataka and tamil nadu .
the two forms of invits that have been allowed are : one , in which investments are made in completed and revenue generation infrastructure projects through the route of public offer of its units and the other type has the flexibility to invest in completed or under - construction projects and take the route of private placement of units . it is mandatory for both the categories to be listed on the stock exchange .
meanwhile , irb infra has posted a 17 . 11 per cent growth in consolidated net for the march quarter at rs . 120 . 35 crore , mainly on the back of rise in toll collection and construction revenue . total income was rs . 848 crore , up 10 . 56 per cent .
is one of the largest build , operate and transfer ( bot ) toll road operators in india , with 16 bot projects in the country and 6 , 722 lane kilometres under its belt . bajaj consultants has been actively involved in providing financial advisory for the past 25 years in india with a focus on infrastructure and has arranged debt in excess of rs100bn in the past three years for large infra groups .
4 – liquidity crunch in domestic credit market and industry outlook : reserve bank of india had adopted a hawkish stance on inflation and had been using prudent monetary policy tools to tighten the liquidity in the market . this had caused the banks to become selective in clearing proposals for loans . moreover , the banks were becoming increasingly cautious on lending to the infrastructure sector on account of rising npas and news of aggressive bidding in roads .
reliance infrastructure in partnership with dogus construction of turkey , larsen and toubro ( l & t ) , il & fs engineering and construction company , and jaiprakash power ventures have filed bids for the rs 10 , 000 - crore ( rs 100 billion ) zojila tunnel project in jammu and kashmir that would provide all - weather connectivity between srinagar and leh - ladakh , currently cut off for almost half the year due to snow .
pawar ' s latest assets declaration shows that the ncp president and his wife pratibha no longer hold shares in irb which is under investigation by the cbi in connection with the murder of rti activist satish shetty in january 2010 . firstpost , in an exclusive report on 9 may , had pointed out to the 2 , 000 shares held by the pawar couple in this firm which has had a meteoric rise in barely 13 years . irb was in the headlines four months ago after the cbi secured magisterial permission to conduct a polygraph test on the company ' s chairman and managing director virendra mhaiskar and nine others in connection with the shetty murder .
moreover , irb’s total income and ebitda is expected to remain at present level while profit after tax ( pat ) and net worth would improve by savings on the cost of debt and steady income from the invit . other income includes profit of rs 23 . 1 crore on account of transfer of the six bot assets to invit .
the zoji la project had landed in a controversy as soon as it was awarded , with congress leader digvijaya singh alleging that the promoters of irb were close to union roads minister nitin gadkari . singh wrote to the prime minister and approached central vigilance commission seeking a federal investigation into the matter . gadkari has rejected all charges as false .
speaking to forbes india , he says , ` ` i cannot change my surname . i have tried every other way of explaining that the two entities are unrelated . ’’ but shaking off the allegations will not be easy . for all his protestations , virendra cannot deny that ideal road builders , the entity incorporated by dattatray mhaiskar in 1977 is a part of irb infrastructure’s history . also , both brothers and their father are directors in many of the subsidiary companies ( mostly special purpose vehicles formed for individual road projects ) formed before the separation . in the ambani’s case , the scheme of separation between the brothers was approved by the bombay high court . the changes in company shareholding patterns , as a result of the demerger were formalized legally . this never happened in the mhaiskar family re - organisation .
“since doubts are now being raised about the tendering process and there are allegations of a quid pro quo between irb and gadkari , the cm should set up a special investigation team to probe the charges , ” said the bureaucrat . “since we are in process of probing the irrigation scam , we should probe the public works scam too . ”
panchshil hotels , established by pawar ' s college friend and sugar trader ishwardas chordia and his brother kantilal in 1978 , is part of the panchshil realty group , which is among the firms in maharashtra that have shown astounding growth . led by ishwardas ' s son , atul , this firm was at the centre of a raging controversy in april 2011 when the leader of opposition in the maharashtra assembly , eknath khadse alleged links between pawar and db realty ' s managing director shahid balwa and his partner vinod goenka , both arrested in connection with the 2g spectrum scam . records with the registrar of companies ( roc ) showed that in 2010 , db realty ' s eon aviation pvt ltd shared the same address ( 31 / a , ground floor , dr . gopalrao deshmukh marg , pedder road , mumbai ) with panchshil hotels pvt . ltd . and other sister concerns such as eon kharadi infrastructure pvt . ltd and eon hadapsar infrastructure pvt ltd .
the 6th epc world awards in association with pricewaterhousecoopers and zee business happened on 18th january , 2017 at the ashok hotel , new delhi . the awards were supported by national and international industry associations : bai ( builders association of india ) , vdma ( verband deutscher maschinen – und anlagenbau – german engineering federation ) , insdag ( institute for steel development and growth ) and acce ( association of consulting civil engineers ) . the epc world awards recognize and award industry projects and infrastructure companies and academia for outstanding contribution to the sector .
overcoming the barriers and apprehensions , the team at bajaj consultants was successful in getting sanctions for the ecb - rtl facility from icici bank , union bank , punjab national bank and indian overseas bank . further , the rupee term loan was structured across 18 years . this was a first for most of the lenders as term loans to road projects are typically structured over 15–16 years . final commitments from lenders were to the tune of rs50bn as against the proposed borrowing of rs33bn . such oversubscription and demand is a rare sight in infrastructure projects .
in the quarter ended june 30 , irb registered 21 per cent growth in total income to ₹1 , 870 crore as against ₹1 , 548 crore in the same period of the previous fiscal , while its net profit increased 31 per cent to ₹238 crore from ₹182 crore a year ago . the company’s board declared interim dividend of ₹2 . 50 an equity share of face value ₹10 each for fy17 .
irb’s order book stood at around ₹8 , 900 crore at the end of the first quarter . “there are five projects that are currently being implemented and three projects will start in september - october , ” hoshing said . “i expect two - three more projects to be completed by the end of this year , and these three projects that are starting will also start generating revenue from day one . ”
“the information on the progress of irb is not confidential ; it is available on its website . the company claims to have constructed 1000 km of road and completed projects worth rs 3 , 100 crore on a build , operate and transfer basis in maharashtra , gujarat and ap , ” the bureaucrat said . toi received no reply to the comprehensive questionnaire it sent mhaiskar but his office forwarded a statement he had sent to
the consortium was finalised and the project debt was closed among eight lenders . typically for such a large syndicated debt for infrastructure projects , the number of lenders generally varies from 12 to 20 . considering the consortium of eight lenders for debt that included rupee as well as ecb facilities , the documentation was multi - faceted and complex . with the concurrence of the lenders and nhai , financial close was achieved in february 2012 , which marked the successful completion of the largest debt tie - up for a toll - based project in the highway sector in india so far .
while irb’s ability to raise funds for the debt was unquestionable , there seemed to be concerns on the project due to the high premium payable to nhai resulting in negative cashflows in the initial six years of the project . the cash shortfall in the initial six years of operation after construction , which was estimated at rs6bn was proposed to be funded by the promoter funding over and above the sponsor contribution of rs15 . 8bn .
irb’s performance for the first quarter of 2017 has been strong and robust . outperforming the estimates , the company clocked growth for sales , operating margin and profit after tax at 30 per cent , 16 . 3 per cent and 10 . 9 per cent , respectively . the decline in interest and depreciation of 13 and 17 . 7 per cent , respectively led to growth of 58 . 1 per cent year on year profit before tax ( pbt ) .
from past experience on the mumbai pune project of irb , which has a similar concession , it has been an established that the tendency of users to shift when offered a better facility is low . in the case of the mumbai pune expressway , even though the toll rates on expressway ( six - laned ) are higher than that of nh4 ( four - laned ) by around 60 % , the users still prefer the expressway , which is a better facility .
the mhaiskar ' s family saga came in for public scrutiny when anti - corruption activist arvind kejriwal cast the first stone at gadkari - and his links with the family . the story was followed up by the media digging up details of gadkari’s business through a dozen shell companies , many with fake addresses . kejriwal says mhaiskar senior ' s loans to purti power are in return for favors made to the group when gadkari was minister for roads in the bjp government in maharashtra in 1995 . each such story in the media has been followed by letters from virendra mhaiskar to the stock exchanges , denying any links between the lending and his company irb infra . virendra is in effect saying that his dad has lent money as an individual . but , dattatray is a non - executive director on irb infra ' s board and it is no surprise that virendra’s protests about the company not being involved , are being ignored by all concerned .
senior bureaucrats say the growth trajectory of irb has an unmistakable parallel with gadkari’s own career . the company , which had constructed only 10 km of road in six years , went from sluggish to superfast after gadkari took over as the public works minister in 1995 . during gadkari’s four - year ministership from 1995 to ’99 , it bagged the prestigious contract for the maintenance of the mumbai - pune expressway as well as key contracts for the construction of new roads , either from the
“a successful invit listing for irb opens up the window for other road developers to exit completed projects and churn their equity / deleverage balance sheet and would also spur interest from the nhai ( national highways authority of india ) to award more bot projects vs . epc ( engineering , procurement , and construction ) / ham ( hybrid annuity model ) as bidding interest would be higher since developers would now have an exit option , ” emkay global financial services ltd said in a 24 april report .
build - operate - transfer ( bot ) , as a means of applying private capital to infrastructure development , has gained more and more attention from the governments . the main reasons for this are as follows : first , the governments try to tap the activity and creativeness of the private sectors by means of bot , improve efficiency and productive forces by interest drive and settle the ubiquitous problems of the inefficiency in the operation of infrastructure ; second , the governments attempt to solve the problem of the capital shortage by means of bot in the case of financial deterioration and the weakening of investment ability ; last , public works and public facilities could be shifted to the track of private - ownership by means of bot . this paper makes a critical assessment of the bot concept with major focus on identifying possible issues that need special consideration and attention in the course of adopting the bot model in tanzania . in addition , an assessment of the current status of affairs with respect to environment conducive for bot project is made . this paper is based on a questionnaire survey of key technical officials in the government . the paper concludes that the bot model could be used as a mechanism to provide opportunity to finance infrastructure projects . however , the paper suggests some necessary preparatory measures . firstly , bot legal and regulatory framework has to be put in place with the intention to protect and guide investors , the government and users tailored for bot projects from start to finish . such policy should incorporate probable solutions that will address most of the issues that have been identified in this paper . secondly , for successful implementation of the bot strategy , a credible and efficient administrative framework has to be ensured . it may require set up of an institution to handle the bot projects . thirdly , creation of awareness among all stakeholders is an important preparatory measure . seminars , campaigns , and other deliberate efforts to educate the public on the bot concepts and their effects are extremely crucial for smooth adoption among the public at large . fourthly , long and short - term training , study tours , and on - job training of personnel tailored to handle bot projects are
mhaiskar senior ( dattatray ) , a director of global safety vision , lent rs 164 crore to gadkari’s firm purti power and sugar limited . he says the money was from his personal savings . he told the times of india on tuesday that the ` savings ' came from selling shares in irb infra , a listed company controlled by his older son virendra in which he held a stake . the brothers , who could not get along with each other , had separated in 2008 and now operate in overlapping businesses through separate companies .
in april 2011 , irb bagged the first ultra mega project in india . this envisages the six - laning of the ahmedabad to vadodara section of nh8 from km6 . 4 to km108 . 7 and the improvement of the existing ahmedabad vadodara expressway ( ne1 ) from km0 . 00 to km93 . 302 in the state of gujarat under nhdp phase v on a design , build , finance , operate and toll basis . this toll road forms a part of the golden quadrilateral ( gq ) project of the national highway authorities india ( nhai ) .
among all the projects awarded in the infrastructure business over the past decade , road contracts awarded through open bids have probably been the most transparent . most projects , bid out by the nhai and the states on a public - private partnership model , have been won after fierce contests among the developers . yet , in public minds the stigma of political patronage being a factor that influences awards has remained . analysts tracking the sector , say they factor in ` linkages’ between the entrepreneurs and politicians . but simply having the connections is not enough , over the years , they have indeed learnt to focus on those who deliver in terms of project implementation and returns . the gadkari story brings the spotlight back on how deeply flawed the system still is .
for the quarter ended in june , irb’s consolidated gross debt stands at rs 13 , 470 crore and net debt is rs 11 , 170 crore . despite the additional funding net debt - to - equity ratio reduced to 2 . 1 : 1 as compared to 2 . 87 : 1 in the end of fiscal 2017 . the growth of 30 . 8 per cent on year on year basis in apat is led by higher tax provision on the expiry of benefits provided under the section 80 - ia of the income tax and the losses in bot .