NHAI has okayed the deferment of premium repayment for two of Sadbhav Engineering 's projects - Hyderabad-Yadgiri and Rohtak-Panipat. Nitin Patel ED of the company explains how the NHAI move will benefit the company and various other details of the project.
He says the company has already applied for deferment of premium rejig of the 4-laning of Gomati ka Chauraha–Udaipur project.
Also Read: NHAI okays premium rejig of 9 projects, rest yet to qualify
Patel believes the lenders and bankers for these projects will benefit greatly from the NHAI move. He says the credit quality of all the lenders that have given funding to the road sector will improve.
Below is the verbatim transcript of Nitin Patel's interview to CNBC-TV18's Ekta Batra and Sonia Shenoy
Ekta: Can you give us more details with regards to which two projects have seen the payment deferral and by how long and how much do you think you will possibly save on account of this?
A: Out of the two first is the Hyderabad Yadgiri which starts from Hyderabad city and going towards Warangal which comes under the newly established Telangana State. So the concession period for this project is 23 years and the funding we have taken for 15 years door-to-door.
Now given the situation the premium we have offered some Rs 11.7 crore in the first year of operations and then every year it will grow by 5 percent. Now the entire premium payment has been made subsidiary to the lenders payment so once the lenders payment will be through with all respect after incurring our routine maintenance and other maintenance expenses of the project, if any surplus will be there then only it will be paid to National Highway Authority of India (NHAI) otherwise it will be deferred along with some interest which should be near to 11 percent as of now based on the current Reserve Bank (RBI) rate.
The second is the Rohtak-Panipat project which we have just commenced in January 2014, the concession period for this project is also 25 years and 16 year was the funding period. So this entire tail period can be used for the purpose of deferment and hopefully whatever initial cash shortfall was there because of various reasons, now it has been mitigated.
Sonia: Do you have any more projects that could be eligible for rescheduling?
A: Third project we have already applied to NHAI which is Gomati Chauraha-Udaipur which is going from Udaipur to Shrinathji Temple, the project is under construction so premium payment starts once the COD happens. Hence, NHAI has taken the view once the COD happens at that point of time considering the first year's traffic data they will allow the premium deferment scheme. So that is why it has not been considered right now.
Sonia: Do you see banks opening up funding for the sector based on what has come through because when we spoke to NHAI they did indicate that the banks dues will get precedence over their own dues so things could improve as far as the lender situation is concerned?
A: Lenders will obviously see the viability of the project first. If the project is viable according to their assessment then only they will come forward to fund the project. But all the earlier ones obviously this will give big support to all the lenders and with this even credit quality of all SPVs will improve, even the credit quality of all the funding made to road sector by all the lenders in their entire portfolio will come up drastically.
Ekta: How much totally is the premium payment plus interest totally which is now been able to be deferred?
A: In Rohtak – Panipat we were supposed to pay Rs 45 crore in the first year and Rs 11.7 crore. All put together say around Rs 56.7 crore for the first year and every year 5 percent. So as of now the total quantum it is difficult to say because every year the test needs to be applied in both the projects. If the traffic grows, if surplus is there then obviously we have to start paying premium to NHAI but if it is not there then obviously it will be deferred. So quantum is difficult to say but for annum it is around Rs 60 crore of the cash flow has been supported by NHAI.
Ekta: What are your other projects which are currently operational which you would be generating cash flow from and what would your equity requirement be if that is the case?
A: In entire portfolio of Sadbhav as of now - 13 projects out of 39 are operational. So where the project funding has been completed and four are under implementation of the various stages and out of the four, three have already achieved financial close. Fourth is yet to be made but all put together we are of the view that around Rs 250 crore of the equity money will be required for the funding of projects which are under construction. And all the operational projects, all the projects now are self sufficient; we will not require any cash for any of the projects now.
Sadbhav Engg stock price
On May 26, 2014, at 14:14 hrs Sadbhav Engineering was quoting at Rs 174.85, down Rs 3.95, or 2.21 percent. The 52-week high of the share was Rs 199.60 and the 52-week low was Rs 52.00.
The company's trailing 12-month (TTM) EPS was at Rs 5.38 per share as per the quarter ended December 2013. The stock's price-to-earnings (P/E) ratio was 32.5. The latest book value of the company is Rs 54.85 per share. At current value, the price-to-book value of the company is 3.19.
Anda sedang membaca artikel tentang
Lenders' credit quality to improve post NHAI move: Sadbhav
Dengan url
https://kesehatanda.blogspot.com/2014/05/lenders-credit-quality-to-improve-post.html
Anda boleh menyebar luaskannya atau mengcopy paste-nya
Lenders' credit quality to improve post NHAI move: Sadbhav
namun jangan lupa untuk meletakkan link
Lenders' credit quality to improve post NHAI move: Sadbhav
sebagai sumbernya
0 komentar:
Posting Komentar