IRB Infrastructure Developers wants to take advantage of the upcoming growth opportunities, Virendra Mhaiskar, chairman and managing director (CMD), told CNBC-TV18.
The highway construction company reported strong earnings for the September-ended quarter, but the big talking point is their fundraising plan through two huge preferential allotments and monetisation of non-core assets. The company will raise Rs 5,347 crore from Spanish infrastructure company Ferrovial S.A and an affiliate of Singapore’s sovereign wealth fund GIC through preferential shares allotment.
“The reason we decided to go into fundraising now is that we see signs of the pandemic fanning away and growth coming back significantly. Also the initiative from the government unleashing big growth plans and particularly private investment in infrastructure development have been added reasons,” Mhaiskar said.
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Therefore, said Mhaiskar, the company decided to address two of the key issues – to deleverage the balance sheet at the holding company level and to get good growth capital to tap the upcoming opportunity.
On fundraising, he said, “We have two marquee investors with whom we have signed two independent preferential allotments and we would be raising around Rs 5,347 crore as a result of this fundraising. The primary objective would be to prepay around Rs 3,500 crore of corporate debt that we have and keep around Rs 1500 crore for growth capital, which can help us to tap another Rs 2000 crore worth of projects in the next 2-4 years.”
According to him, the toll revenue is now above pre-COVID levels. He further said that the company is not seeing aggressive competition in the hybrid annuity model (HAM) space and that it will look to monetise Sindhudurg airport going ahead.
For the entire management interview, watch the video