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IVRCL Ltd has begun negotiations for stake divestment in three more road projects and one desalination plant.
It expects to close the deals within six months.
The Hyderabad-based infrastructure company concluded agreements for sale of stake in three tollways located in Tamil Nadu recently.
R. Balarami Reddy, Executive Director, Finance, told Business Line that the stake sale in three tollways to TRIL Roadways, a Tata Group company, is a perfect beginning for the company during the current financial year.
“We will now take up three road projects for stake divestment. These include Raipur-Bilaspur road section of 49 km, Indore-Jhabhua road project and a 50-km road stretch of Jallandhar-Amritsar project and Chennai desalination plant for divestment,” he said.
The company management had made its intent clear to stay away from build, operate and transfer (BOT) mode infrastructure projects due to inherent problems in execution and then monetising them after completion.
Instead, it had announced to churn projects, that is, divest stake in some of the matured projects to lay thrust on equipment, procurement and construction (EPC) contracts as an infrastructure contractor.
The divestment of stake enables the company to move away from completed projects and also trim its debt obligation.
“On a consolidated basis, the company is carrying a total debt of about Rs 5,200 crore. The divestment of stake in four more projects, including the desalination plant, will bring down the debt considerably,” he said refraining to getting into numbers due to non-disclosure agreement.
The company has invested more than Rs 1,200 crore in these four projects.
In the deal signed with TRIL Roadways Ltd, IVRCL had indicated that the road projects are worth about Rs 2,200 crore.
The company shares closed the day up 2.76 per cent at Rs 22.35.
> rishikumar.vundi@thehindu.co.in
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