IRB Infra renews focus on road projects

IRB Infra renews focus on road projects

Mumbai:Indian toll-road builder IRB Infrastructure Developers plans to renew its focus on road projects and has dropped plans to foray into power, while its cement plans are on hold, a top official told Reuters on Monday.

“...There is a lot of orderbook build-up happening on the road-side itself. So we want to keep focused on highway biddings," chairman and managing director Virendra D Mhaiskar told Reuters in an interview.

Earlier in June, the company said it was planning to diversify into cement and power segments.

“We looked at it (power), we also got qualified (to bid) for one or two projects, but we decided internally we are not going for it," Mhaiskar said without elaborating further.

The company has also put a hold on its plans to venture into the cement sector too.

As on today, IRB Infra has 16 build-operate-transfer projects, of which 10 are operational, and an orderbook position of close to 100 billion rupees.

He did not divulge the details of power projects where IRB Infrastructure was qualified to bid.

It has “no immediate plans" to venture into cement sector, following a lack of clarity, especially in mining segment. The company had plans to bid for limestone mines as part of its cement foray.

“We expect good order pipeline to get bidded out over the next 6 months, with lot many projects presently pending for financial bidding with the National Highways Authority of India (NHAI). Our sense is that over the next 3-5 months those should get bid out on financial parameters as well...."

The company has also applied for pre-qualifications of projects worth RS220-250 billion for which it expects financial bids to be finalised within 3-5 months.

“Ability-wise, if we look at it, we would be willing to add a $1 billion worth of order book accretion annually going forward," Mhaiskar said, adding for the next 3-5 years.

IRB Infra would execute its current Rs100-billion order book in the next 3-4 years, which would be funded through internal accruals, he said, adding that the company is not looking at any fund-raising programmes.

The company is also close to tying up Rs7.50 billion to fund its Tumkur-Chitradurga road project in Karnataka.

“We should be in a position to close it in a month or so..."

On the toll side, the company collects close to Rs250 million per day and expects this to rise further.

It is also looking at bidding for a couple of large projects in Andhra Pradesh, depending on their commercial viability.

Shares of the company closed 0.42 % lower at Rs262.90 in a steady Mumbai market.