Asset monetisation: NHAI to wait till traffic is normal

By: |
June 07, 2021 5:15 AM

According to rating agency Icra, toll collections fell by around 10% in April 2021 over March 2021 and estimated to have declined by 25-30% in May 2021 over April 2021.

Apart from InvIT, NHAI has two other means to raise funds through monetisation of assets – toll-operate-transfer (TOT) model and toll securitisation. Proceeds from the asset monetisation programme are used to repay debt and develop highways.Apart from InvIT, NHAI has two other means to raise funds through monetisation of assets – toll-operate-transfer (TOT) model and toll securitisation. Proceeds from the asset monetisation programme are used to repay debt and develop highways.

The National Highways Authority of India (NHAI) will wait “till traffic on the highway stretches is back in full volume” to move ahead with its asset monetisation plans. In the Budget for 2021-22, the government set a target for the NHAI to raise Rs 10,000 crore through monetisation of its operational stretches in the current fiscal year.

Widespread curfews and severe restrictions on mobility amounting to national lockdown in May has had an big impact on highway toll collections.

According to rating agency Icra, toll collections fell by around 10% in April 2021 over March 2021 and estimated to have declined by 25-30% in May 2021 over April 2021.

“Once traffic is restored, we will go ahead with our asset monetisation plans. We are in regular touch with our potential investors. Traffic on highways is expected to resume in full throttle from the middle of the current month,” said NHAI chairman SS Sandhu.

The authority’s Rs 5,100-crore maiden InvIT has received all the required clearances from the market regulator Sebi, but the IPO will hit the market only by the end of the current month.

Apart from InvIT, NHAI has two other means to raise funds through monetisation of assets – toll-operate-transfer (TOT) model and toll securitisation. Proceeds from the asset monetisation programme are used to repay debt and develop highways.

NHAI has raised around Rs 17,000 crore through the toll-operate-transfer (TOT) model so far by successfully granting on long-term lease three bundles out of the five attempted so far. The sixth bundle could also have taken off by now but for the subdued traffic on roads.

As on March, 2021, NHAI had Rs 3 lakh crore debt. The authority was given the task of executing the Bhartmala Pariyojona project in October, 2017 under which the government plans to develop 34,800 km highway project (including 10,000 km residual NHDP stretches) with an estimated outlay of Rs 5.35 lakh crore. Out of this, as on March-end, 2021, it has awarded 14,679 km of stretches worth over Rs 4 lakh crore.

For the current fiscal, NHAI has been allocated Rs 57,350 crore in the Budget for 2021-22, up from Rs 49,050 crore (RE) in 2020-21. NHAI has also been permitted to borrow Rs 65,000 crore in 2021-22, same as in 2020-21.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1Easy and smooth commute for Mumbaikars! Ghatkopar-Mankhurd link road flyover likely to be open soon
2Highway contracts: Easier entry norms pay off
3Second COVID-19 wave: Here’s how NHAI, contractors made workers stay back