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ICRA estimates that NHAI’s efforts to monetarily integrate might bring in about Rs 60,000 crore by FY25. According to India Ratings & Research, 53 projects with a combined value of Rs 2 lakh crore have been identified by the government and would go up for bid in the upcoming years. Build-operate-transfer (BOT) contracts, the guidelines for which were adjusted last year, will be used to solicit bids for these projects.
ICRA estimates that NHAI’s efforts to monetarily integrate might bring in about Rs 60,000 crore by FY25. Similarly, according to India Ratings & Research, 53 projects worth a combined Rs 2 lakh crore have been identified by the government and would go up for bid in the upcoming years. Build-operate-transfer (BOT) contracts, the guidelines for which were adjusted last year, will be used to solicit bids for these projects.
According to Rishabh Jain, Associate Director, India Ratings & Research, “the goal behind bringing in revised norms for BOT projects was to increase the level of private participation in the sector and keep NHAI’s debt level in check.”
He also stated that the percentage of BOT in the total project mix will climb during the current fiscal year and continue to rise throughout the ensuing years.
The industry’s large corporations’ withdrawal due to unsatisfactory returns on investment (ROI), inflexible concessionaire agreements, and legal conflicts with the government was the impetus for modifying the BOT guidelines.
The sale of the 33 road assets through the toll-operate-transfer (TOT) and Infrastructure Investment Trust (InvIT) modes is expected to generate a monetisation potential of around Rs 53,00–60,000 crore, according to ICRA. This could result in a lending opportunity worth Rs 38,000–43,000 crore for banks and capital markets.
Furthermore, by the end of FY2025, MoRTH might reach up to 71% of its Rs 1.6 lakh crore monetisation objective under the National Monetization Pipeline (NMP), according to ICRA.
“Over the last six years, the NHAI has monetised 29 assets across 10 TOT bundles with valuation multiples ranging between 0.44 times and 0.93 times, realising Rs 42,334 crore so far,” stated Ashish Modani, Vice President and Co-Group Head, Corporate Ratings, ICRA.
Road sector monetisation was projected to account for Rs 1.6 lakh crore, or 27% of overall monetisation between FY2022-FY2025, under the National Monetisation Pipeline (NMP).
Group Media Publication
Construction, Infrastructure and Mining
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