Mumbai: Surface transport infrastructure firm IL&FS Transportation Networks Ltd, is eyeing projects overseas for expansion, a top official told Reuters on Wednesday.
The firm, which raised Rs700 crore through an IPO in March, will bid for projects in Tanzania and South Africa, and is expecting to be awarded a road project in Kazhakstan, managing director K Ramchand said.
“We are doing a feasibility study for a project in Tanzania. We are trying to do something in South Africa as well. These are road projects,” he told Reuters in an interview.
IL&FS Transportation will bid for a 185-kilometre-long road project in South Africa, valued at Rs6,000 crore, and also conduct a feasibility study for a Rs2,000 crore road project in Tanzania, he added.
The company will make the South Africa bid by October, and expects the bidding process to be finalised by December.
“We have a local partner (for Tanzania). The feasibility study will be done in two months,” he said.
The firm, a unit of transport and infrastructure firm IL&FS, had also emerged as one of the lowest bidders for a $1.5-billion, 300-km-long European road project in Kazhakstan. The project is yet to be awarded.
“It is still under the negotiation process. It’s a conditional bid, it’s not a compliant bid,” Ramchand said.
Projects at home
Back home, IL&FS Transportation expects to tie-up Rs6,220 crore for three road projects in Jammu & Kashmir, Andhra Pradesh and the North East in two months. The projects were awarded in FY11.
“The concession, (or license) agreements for all of these would be signed in the next 15-20 days. We will achieve financial closure in two months, unless the markets suddenly become volatile, which we do not think will happen.”
The firm which has total road assets (including developed and under development) of 12,000 km, has already achieved financial closure for 5 road projects, and a metro project in Gurgaon, worth about Rs7,100 crore.
Its current order book stands at around Rs15,000 crore, up from Rs12,000 crore in March, Ramchand said.
The National Highways Authority of India (NHAI) awarded 2,988 km of projects to infrastructure firms in the year to March 2010, with IL&FS Transportation having a 10.1% share in the project awards, trailing only IRB Infra, according to a report by Motilal Oswal.
Its consolidated net profit for FY10 surged to Rs344 crore from R26.26 crore in the previous fiscal and Ramchand expects profits to continue rising in the current fiscal.
“I think we would see a rising trend. That’s evident from the order book which is coming up,” he said, adding the firm would not see an exponential growth seen in FY10.
Shares in IL&FS Transportation closed flat at Rs280 a share in a steady Mumbai market.