IRB Infrastructure to seek Rs 70 crore compensation from NHAI

MUMBAI: IRB Infrastructure Developers plans to claim a compensation of around Rs 60-70 crore from the National Highway Authority of India for terminating its contract for a Goa road project after the latter could not acquire land for it.

Road projects have faced delays due to issues relating to land acquisition, environmental clearances and right of way but this is only the second instance in the last two years where a project has been cancelled due to NHAI's inability to acquire land.

"We haven't yet received a compensation claim from IRB. But if this happens, it would be the first time where a developer seeks compensation for a project cancelled due to land acquisition problem. We will have to examine our liability in the case," a senior NHAI official told ET.

On December 23, IRB said that NHAI has cancelled the Goa road project that it had won in January 2010. Although IRB had written off the project from its order book in the quarter ended September in view of the inordinate delay in the project, the cancellation news had a negative impact on the shares of the company.

IRB shares have shed almost 10% on the Bombay Stock Exchange since the announcement as against a 1.4% decline in the benchmark index Sensex in the same period. Analysts said that the news of a compensation would only be a minor relief for the investors.

"The contract allows us to claim 150% of the equity investment of Rs 34 crore in the project. We may also claim compensation for the Rs 10-15 crore we spent on the financial closure and other work related to the project," IRB's Chief Financial Officer Anil Yadav said.

IRB had formed a special purpose vehicle, IRB Goa Tollway Pvt, to execute the project, which will claim the compensation for the project which entailed four-laning of the Panaji- Goa stretch of Goa -Karnataka Border road. At the time of winning the project, the company had said that it would cost Rs 800 crore, of which Rs 186.30 crore would be the grant from government.

Typically, at the time of awarding a project NHAI owns almost 80% of the land required for it while it acquires the balance within six months. According to NHAI, land acquisition has been most difficult in Goa, Kerala and West Bengal.

IRB Infra bags Rs 3,600-cr NHAI project in Gujarat

MUMBAI: Construction and engineering firm IRB Infrastructure Developers Ltd on Friday said it has bagged the Rs 3,600-crore first ultra mega project of National Highway Authority of India (NHAI).

The company has emerged as the preferred bidder for six-laning of Ahmedabad to Vadodara section of National Highway-8 on Design Build Finance Operate Transfer (DBFOT) Toll basis, IRB Infrastructure Developers said in a filing with the Bombay Stock Exchange.

The project involves building over 102 km of the highway and improving another over 93 km stretch of the existing Ahmedabad Vadodara Expressway under Phase-V, it said. The project, costing approximately Rs 3600 crore, would be built in three years under the terms of the contract, it said.

IRB would get tolling rights on Ahmedabad Vadodara expressway from the appointed date and has a concession period of 25 years. The premium offered to NHAI in the first year is Rs 309.60 crore which will increase by 5 per cent YoY, it added.

The work involves upgradation of existing section of NH-8 between Ahmedabad and Vadodara from existing two-lane highway to a six-lane super expressway and value addition to the existing Ahmedabad Vadodara Expressway, it said.

Shares of the company closed today at Rs 213.65 on the BSE, up 1.11 per cent from its previous close.

Punj Lloyd bags Rs 735-crore project from NHAI

NEW DELHI: Punj Lloyd today said its subsidiary, Punj Lloyd Infrastructure Limited , has bagged an order worth Rs 735 crore from the National Highways Authority of India (NHAI).

The subsidiary, which has been set up for implementing infrastructure development projects, will upgrade the national highway from Khagaria to Purnea in Bihar to a two-lane, undivided carriage way with paved shoulders under the National Highways Development Programme (NHDP), Punj said in a statement.

The project will work in a build-operate-transfer (BOT) annuity basis, the statement added.

The scope of work will involve the design, building, finance, operation and transfer of the 140 km section of the national highway, it said.

"This is a significant BOT project... Through Punj Lloyd Infrastructure Limited, the Group will continue rational bidding with an aim to create a portfolio of Infrastructure Development projects. This project complements our existing portfolio of highways construction portfolio in India," Punj Lloyd Chairman Atul Punj said.

Upon signing a concession agreement with NHAI , Punj Lloyd will be entitled to semi-annual annuities of Rs 56 crore for 17 years, it said.

Punj Lloyd has built over 1200 km of highways under NHDP falling under the Golden Quadrilateral and East West Corridors for NHAI. The Group has also executed BOT Projects in the past along with partners.