Essel Highways's' order book value $1.8 billion (around Rs10,720 crore), with eight state highway projects and two national highway projects operational currently, coupled with three national highway and one state highway projects under construction. It is in lookout for stressed highway projects in India.
Essel Highways is on the lookout for stressed highway projects in India.
"We are looking for good build-operate-transfer projects that will come up,", Krishna Prakash Maheshwari, chief executive officer of Essel Highways, said. At the same time, the company wants to weigh the Hybrid Annuity Model (HAM) of road projects for some more time.
Right now, other big players in the Indian road sector too are preferring to stay away from HAM financial model only to observe the finer details and also to check if there are any grey areas that may result in the contracts getting stuck in legal tangles in the future. Once the picture on HAM gets clear, players in the industry could bid for road projects under the financing model.
As per a report by India Ratings & Research earlier this year, around Rs 25,500 crore of highway projects could be under stress. This is primarily because of unfavourable macroeconomic conditions, sub-optimal traffic performance and stretched debt levels.
"There are stressed assets available in the industry and we are looking not just for new projects. We are evaluating various options and would take the next step at an appropriate time," Maheshwari said.
Essel Highways's' order book value $1.8 billion (around Rs10,720 crore), with eight state highway projects and two national highway projects operational currently, coupled with three national highway and one state highway projects under construction. Some of the projects are Delhi-Panipat, Ahmedabad-Godhra, Lucknow-Raibareli, Kundli-Manesar, etc.
"We are also the first company in the road sector to get investment from a consortium of investors led by Goldman Sachs Inc," said Maheshwari. Goldman Sachs has agreed to invest $220 million in Essel Highways through a structured debt transaction, which is one of the biggest fund-raising exercises in the sector. According to a report, Essel Highways has plans to raise around Rs 400 crore from Aion Capital Partners.
ateeq.shaikh@dnaindia.net
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