Bongulur to Tukkuguda - Outer Ring Road

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In December 2007, the Hyderabad Urban Development Authority (HUDA) signed a 15 year contract (including two and a half years of construction period) to Hyderabad Expressway Pvt. Ltd.(HEPL) for construction of a 13 km stretch of 8-lane expressway in the city of Hyderabad. The project was part of Phase II program of Outer Ring Road (ORR) of HUDA in Andhra Pradesh. The important places to be linked by this outer ring road include Patancheru, Shamirpet, Shamshabad and Amberpet Kalan on Vijayawada road. It would be 75 feet wide and would have eight lanes. Under the contract, HEPL was responsible for the design, construction, development, finance, operation and maintainence of the 13 km stretch of the eight-lane acess controlled expressway (AP-IV ORR).This ring road is expected to decongest the traffic flow on the existing major arterials and relieve congestion on metropolitan area and inner ring road and meet the future demand. HEPL, the project company established to implement the project, was owned by India’s Gayatri Projects Ltd (50%) and Maytas Infrastructure Private Ltd (50%). The consortium won the contract through domestic competitive bidding conducted by HUDA, by asking for the lowest subsidy. Under the concession contract, HEPL was to recover the capital costs and operating costs including returns by way of a fixed annual payment (annuity) from the Hyderabad Urban Development Authority in the amount of US$ 15.25 million during the concession term (excluding two and a half years of construction period) and one time upfront subsidy of US$ 17.6 million from HUDA. The total capital cost of the project was estimated at Rs 430.96 crores (104 million). Of this, the upfront subsidy would cover US$ 17.6 million. The project reached financial closure in December 2007 with a debt equity ratio of 4.2:1. Contribution by both Gayatri Projects Ltd. and Maytas infrastructure Private Limited was US$ 8.5 million each. IL&FS Financial Services Ltd (IL&FS) has syndicated entire debt of US$ 70.4 million and United Bank of India is the Leader of the Consortium of Lenders. Construction on the project began in December 2007 and was expected to be in full commercial operation by June 2010. www.projectstoday.com www.gayatri.co.in