Key takeaways of the call

Post demonetization the toll collection was suspended till Dec 2, 2016. NHAI agreed to compensate for the O&M and interest cost incurred. Recognized Rs 59.79 crore (of which so far received Rs 16.94 crore) for this year except Maharashtra Border check post. Amount not recognized in Maharashtra Border check post is Rs 20.83 crore as revenue and the Government of Maharashtra agree to compensate it by extension of time. Balance compensation from NHAI project is expected to be received by end of this quarter.

Order book of the company as end of March 31, 2017 is Rs 385.90 crore and this is largely maintenance construction contract which the company takes up on behalf of its subsidiary/SPV. The maintenance work is from Hyderabad-Yadgiri and Bijapur-Hungund. Of the maintenance order book about Rs 123 crore is the work of both the Hyderabad project and balance is Bijapur-Hungund. There is no maintenance work scheduled for FY19. The company on March 29, 2017 has signed Maintenance agreement with Sadbhav Bangalore Highway Private Limited (a wholly owned subsidiary of the Company) worth Rs 70 crore for maintenance and repairs works during the development period and construction period.

NHAI so far awarded 45 Hybrid Annuity (HAM) projects. Financial Closure (FC) is yet to be achieved for significant number of those projects there by limiting concessioner of those projects bidding further. The company however continues to bid in HAM projects.

Post Q3FY1 and till date, the company has submitted financial bids for about 15 projects with an aggregate cost of about 15800 crore. SIPL emerged L1 in two of these projects. While the cost of Maharashtra HAM project (i.e. Waranga-Mahagaon) is about RS 1071 crore and that of Rajasthan (Udaipur Bypass) was about Rs 891 crore. The company has emerged L1 and L3 in about 6 of these projects. The company has emerged L3 and L5 in two projects. Financial bids for one project worth Rs 1443 crore is yet to be opened and it is expected to be opened by next week. Competition intensity is high.

Financial Closure for 2 Gujarat HAM projects i.e. Bhavnagar-Talaja & Una-Kodinar highway is already achieved. Project completion time is 30 months from appointed date. Appointed date for Bhavnagar and Una project declared was Feb 7, 2017 and Feb 9, 2017 respectively. Expecting first tranche of Grant for these two projects in Q1FY18.

Similarly FC is achieved for both Udrapur (Uttar Pradesh) and Nainital (Uttrakhand) HAM projects. While the appointed date for Udrapur has come on March 31, 2017, appointed date for Nainital project is expected this month. Construction period for these two projects is 24 months from appointed date.

Sadbhav Bangalore Highway project – LoA signed with NHAI on Sep 26 2016. The FC achieved on May 3, 2017 but the appointed date is yet to be announced by NHAI. The appointed date is expected in this quarter. More than 90% of land is available with NHAI.

Project under pipeline: NHAI has lined up 11 projects for bidding with appox project cost of about Rs 22647 crore. Last date for submission of financial bids for these projects is 31st of July 2017.

HAM projects to see traction and lot of bidding activity and the company is poised to tap those opportunities.

Received a compensation of Rs 5.83 crore in lieu for car and bus traffic not tolled in case of Jalna-Aurangabad project.

Maharashtra Border check post – Started collection in 3 check posts during Q4FY17 and collected a toll of Rs 2.42 crore.

Maharashtra Border Checkpost: the company has filed a claim amounting RS 170 crore for cost and time escalation as there is delay in handover of land. The company filed for claims towards cost escalation in 2009. The claim was already cleared by three member expert committee appointed by MSRDC steering committee. The expert committee recommended for paying for full claim or extension of time in line with IRR of 17%.

In first round borrowing to the tune of Rs 2400 crore spread in 5 projects will be refinanced. Efforts are underway towards this. The company is confident that the refinancing of debts of Shreenathji-Udaipur and Bhilwara-Rajsamand will be completed by end of this quarter. Similarly debt of one more projects is also expected to be completed by this quarter.

Scheduled date for completion of Mysore Bellary project is June 2017. The balance area for which land is not provided will be taken out and CoD will be issued by the nodal agency for this project.

NHAI has deferred the premium for Shreenathji-Udaipur Tollway.

Of FY17 revenue (including other income) about Rs 10305.73 crore is from operational SPV, under construction SPV is Rs 3417.56 crore, SIPL standalone is about Rs 3137.11 operational income.