GMR Infrastructure has tied up debt for its Rs 1,700 crore highway between Hungund and Hospet in Karnataka, said a company official.
This was the company’s only road project that was pending financial closure. The 99-km project has a debt-equity ratio of 70:30.
“IDBI Bank and Axis Bank have underwritten the loan and they are working on the syndication of the loan,” said the official, requesting anonymity. The interest rate for the loan, which is expected to be in the region of 10.5-11%, is just being finetuned, he said.
He had said earlier closure for the project was likely by the end of this month.
IDBI Bank has also underwritten the loan for GMR’s Rs 2,190 crore Hyderabad-Vijayawada project.
GMR bagged the National Highways Authority of India (NHAI) project in February along with New Delhi-based Oriental Structural Engineers.
They hold 51% and 49%, respectively in the build-operate-transfer (BOT)-toll project that has a concession period of 20 years.
GMR, one of the largest highway developers in the country, has six operational highways totalling 421 km. Three are toll-based and rest are on annuity. Three more are in the development stage, including Hungund-Hospet, Hyderabad-Vijayawada and one near Chennai.
With the financial closure for the latest project, GMR can bid for three NHAI projects. According to a new NHAI clause, no developer can have more than three projects pending closure at any point in time.
GMR is in the process of acquiring land for its three projects. “We have acquired 70—80% of the land needed for the Hyderabad project,” the official said.