KNRC expects order inflow to pick up in 4QFY18, as NHAI starts awarding projects. It expects incremental order inflow of Rs 2,200 crore-2,700 crore by the end of FY18. Key projects expected to be finalized, where KNRC is favorably placed include (a) KSHIP HAM project of Rs 1,200 crore, and (b) one of the four HAM projects it has bid for in the Kerala/Karnataka region. KNRC expects order inflow of Rs 3,000 crore in FY18 and Rs 4,000 crore in FY19. KNRC has guided booking revenue of Rs 1,800 cr/2,000 cr/2,300 cr for FY18/19/20 and operating margin of 16% for FY18. Revenue booking for 2HFY18 would be driven by execution of projects like the Madurai project, the Thiruvanathpuram Bypass, Salem city flyovers, and the Hubli-Hospet project. Irrigation order book of Rs 850 crore is expected to be executed by FY19.
Both of KNRC’s BOT projects have received 100% COD and toll collection stands at Rs 1.4 million per day for the Walayar project and at Rs 1.5 million per day for the Muzzafarpur project. KNRC has also recently refinanced the Muzaffarpur project, which will help reduce the interest burden for the project by Rs 110 million. Refinancing of the project, pickup in traffic growth, and reduction of debt by infusing equity into the project has led the projects to be self-sustaining. KNRC also intends to securitize the Kerala BoT project cash flows for Rs 100 crore, which will help it to meet the equity requirement for the upcoming HAM projects.
KNRC had entered into a deal with Essel Infra to sell its entire equity stake in two annuity projects (KNRC’s stake: 40%; Patel Engineering’s stake: 60%) to the Essel group for an EV of INR8.5b. However, the deal was subject to receiving NoC from the NHAI by November 2017, which did not materialize; hence, the deal has been put off. KNRC intends to monetize the assets post recovery of claims from NHAI. Together, the projects have a claim of Rs 320 crore.