“Post-election, we have seen a spurt in the collection. And in fact, the tariff rise has also started from 2nd of June, so that has also led a 3.3% improvement in the toll collection,” says Anil Yadav, Director, IRB Infrastructure.
Good collection data this time around too. Talk to us about how is the trend shaping up?
Anil Yadav: Trend, if you look at overall as compared to April and May, June collection is much better as against the quarterly improvement of 31%. The June collection, if you look at June month alone, the collection was almost up by 35%. Post-election, we have seen a spurt in the collection. And in fact, the tariff rise has also started from 2nd of June, so that has also led a 3.3% improvement in the toll collection.

And obviously, you are seeing an improvement there in toll collections, but are we expecting more price hikes anytime in the next couple of months? Is that something on the cards that one should be watching out for?
Anil Yadav: Toll is an annual rise and this year’s rise is already done. And after this, there will not be any rise. But typically, what happens if there are four to six laning project, once the project gets completed, there can be a tariff revision because four to six laning once we start the project, we only get 75% of the toll rate and once the project is completed, then we will get 100% tariff revision.

One of such projects is expected to complete end of this financial year. But we do not expect any further increase in any of the project because the tariff revision is annual.

Buzz on the street and some channel checks seem to be suggesting that IRB is readying for some kind of a fundraise. Is there a requirement? And if yes, where exactly is the requirement coming from?
Anil Yadav: I think with respect to the fundraise, today we are having one of the lowest debt-equity in the sector. Consolidated debt-equity is 0.8 is to 1. And in terms of the requirement of the fund, if you look at the equity requirement, typically, we are in infrastructure and we require equity for the ongoing project. And as against, if you look at last three-four years, our equity requirement at any balance sheet, debt used to be in range of 2500 to 3000 crores. If you look at March 31st, 2024, balance sheet, our equity requirement will be less than 300 crores.

So, now we do not have any such requirement. Company is generating the robust cash flow. There is distribution coming from the private InvIT and we do not require any fund and there is no thought on the fundraising as far as company is concerned.

How are the orders flowing in? Talk to us about order book.
Anil Yadav: Order book, we have total 34,000 crores order book. Out of that, roughly 6000 crores will include the EPC order book and O&M order book will be around 28,000. Out of 28,000, 2000 crores order book will get executed over a period of two, two-and-a-half years.

As far as new opportunity is concerned, as we predominantly bid for the BOT, TOT and HAM in the same order of the preference, there is almost 2 trillion of pipeline, 2 lakh crores of opportunity available in the BOT space, which will get bidded out.

And apart from that, roughly 60,000 to 70,000 crores worth of project available on TOT basis. So, as and when these projects will come for the bidding, we will be participating the same.

You have been a very key player in infra and road sector is concerned. We are going into budget. Well, a lot of work in this direction has happened outside of budget too in the last 10 years. What are your expectations? Any areas you would like to hear more about or some focus coming in, in infra and budget?
Anil Yadav: I think various reform has already taken place and the reforms may not be through a budget only. So, I think whatever the challenges were there with regard to the land acquisition and other issues relating to the sector, that is already resolved by the government. Government has started paying three times of the market rate to the landowners. And now taking the land has not become as challenging as it was 10 years back. So, now there are a lot of reforms has been taken place. And as of now, we do not have any specific expectation from the budget. Definitely, there will be budgetary allocation to the sector and which is continuously increasing.

What I also want to know is just in terms of execution, how is that expected? Obviously, Q1 this time, because it was that election time, maybe some subduedness is what is one watching out for, but now has the execution picked up again? What are you expecting there?
Anil Yadav: I think in terms of execution, as any infrastructure company goes, Q2 is typically where the activity will be minimal because of the monsoon stuff and that kind of phenomena we see every year. So, typically the pickup in the toll collection and even in the execution happens from the Q3 of the financial year.

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