The Anil Dhirubhai Ambani Group’s Reliance Infrastructure (R-Infra) expects extra revenue of Rs 2,000 crore by 2011-12 from 11 infrastructure projects, to operationalise during the current financial year.
There are seven road projects, a metro rail project each in Mumbai and Delhi and the Western Region System Strengthening Scheme transmission project, said Lalit Jalan, chief executive officer.
“Currently, we are executing 24 projects worth Rs 40,000 crore. At least 11 projects will take-off during this year and for most, cash flow will start from the second year of operation,” he said.
R-Infra is already the largest road construction company in the country. It has 11 projects of the National Highways Authority of India (NHAI) of 970 km length, with investment outlay of Rs 11,900 crore, said the executive.
R-Infra targets to have a road project portfolio of about Rs 40,000 crore within the next two and a half years. It is already the preferred bidder for NHAI’s Rs 2,960-crore, Delhi-Agra six-laning project, a length of 180 km. The project will start generating revenues immediately after achieving financial closure, expected within the next six months. It has three projects for road six-laning and has planned to bid for more.
All road projects are now handled by Reliance Infraventures, a 100 per cent subsidiary of R-Infra.
The concession period for most of these projects are about 25 years and revenues start flowing from the second year of operations. If an investment of Rs 1,000 crore is done in the first year, a minimum of Rs 100 crore starts coming from the second year, said Jalan.
Rural infrastructure development, metro rails, power projects and airport development are some sectors in which R-Infra will focus in future. The company hopes to bag rail metro projects coming up in Hyderabad, Bangalore and Jaipur, said Jalan.
R-Infra requires an investment of Rs 40,000 crore in the next three years for implementing its projects. Of this, the equity portion is about Rs 10,000 crore. The company has a cash balance of Rs 8,500 crore and every year generates about Rs 1,500 crore profits.
The promoter group will also infuse about Rs 2,000 crore by September. Loans for a majority of the projects have been tied up and it has invested the equity portion for the ongoing 11 projects, said Jalan.
