Toll collections increased in the past quarter: Developers still cautious of the trend
Toll collections for several roads have seen a somewhat higher growth in the April-June quarter. The reason behind this growth is partly due to tariff hikes and partly due to more traffic. For a clutch of 17 road projects belonging to IRB Infrastructure Developers, Ashoka Buildcon and Sadbhav Engineering went up by 8% to nearly Rs. 616 crore over the January-March period.
The good news is that the toll collections have increased a good 14% on a year-on-year basis. Due to a hefty18% revision in tariff, IRB’s Mumbai-Pune stretch has seen a sharp 24% jump in toll collections. The company is allowed to revise the tariffs once in every three years. The lifting of the mining ban in Karnataka has helped drive up traffic on IRB’s Tumkur-Chitradurg road.
Ashoka Buildcon’s Belgaum-Dharwad, Dhankuni-Kharagpur, Jaora-Nayagaon and Indore-Edlabad have gained from tariff revisions in the range of 5.5-10%. In Q1FY14 and Q2FY14, collections had dipped 3%-5%, before picking up marginally in the third quarter.
Among the roads that have done well this time around are Mumbai-Pune, Surat-Dahisar, Pune-Solapur, Tumkur-Chitradurga, Indore-Edlabad, Hyderabad-Yadgiri and Dhule-Palesnar. However the chairman and managing director, IRB Infrastructure Developers V.D. Mhaiskar stated that it is too early to call a revival. Though the traffic on many of the more prominent roads has risen by about 6% between April and June, but we still cannot call it a revival until we monitor the traffic for a little linger period.
Ashoka Buildcon’s chief financial officer, Paresh Mehta too doesn’t see a significant movement on traffic as yet. Mehta stated that it is growing in the range of 2-3% but there’s hardly any industrial recovery to suggest this will sustain. CRISIL in its assessments had expressed apprehensions that many road projects would turn unviable if the poor traffic growth continues like this.
Source- The Financial Express
Ashoka Buildcon, Ashoka Buildcon’s Belgaum-Dharwad, Dhankuni-Kharagpur, Hyderabad-Yadgiri, Indore-Edlabad, IRB Infrastructure Developers, Jaora-Nayagaon, Mumbai-Pune, Mumbai-Pune stretch, Pune-Solapur, Surat-Dahisar, Toll collections, Tumkur-Chitradurga
