DBL Jaora-Sailana Tollways Limited

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In January 2013, Madhya Pradesh Road Development Corporation (MPRDC) signed a 15-year concession (inclduing construction period of 730 days) with Dilip Buildcon Limited (DBL) for the strengthening, improvement,two-laning/intermediate laning, operation and maintenance,and tolling of 87.77kms of 4 existing major district roads in the state of Madhya Pradesh - i) Jaora–Piploda–Jalandharkheda & Piploda–Sailana Road (Ratlam district, 42.27kms), ii) Raipuriya – Patlabad – Bamniya Road (Jhabua district, 18.18kms), iii) Javad –Khoh Road (Neemach district, 21.07kms) and, iv) Soyat Pidawa Road (Shajapur district, 6.25.96kms). Under the contract, DBL was responsible for the design, construction,finance, operation and maintenance,strengthening and widening the existing 2-lane carriageway to 2-lane divided carriageway.The scope included construction of new pavement, rehabilitation of existing pavement, construction and/or rehabilitation of major and minor bridges,culverts, road intersections,interchanges, drains, etc.The expansion project, part of the MDR (major district roads) development project, was expected to ease traffic congestion and give significant stimulus to trade and commerce in the entire region. DBL established DBL Jaora-Sailana Tollways Limited (DJSTL),a special purpose vehicle on 29th November 2012, to implement the project. The SPV won the tender through international competitive bidding, conducted by MPRDC,by requesting the lowest annuity payment of US$ 4.1mn (INR 241.2mn @58.6 INR/USD) . Other details of bidding were not known at the time of collection of this information. Under the contract, the SPV was to recover the capital costs and operating costs including returns through semi-annual payments of INR 120.6mn from MPRDC, during the term of concession. DBL would execute the EPC for the project. The concession agreement for the project was signed sometime around January 2013. The project was expected to be financed with a debt/equity ratio of 70/30. The estimated capital cost of the project at the time of financial closure was US$ 23.2mn (INR 1360mn @58.6INR/USD). Financing was expected to be comprised of a term loan of US$ 16.2mn (INR 950mn) and sponsor equity of US$ 7mn (INR 410mn). Other details of financing were not known at the time of collection of this information. The project started construction in April 2013 (Appointed Date) and was slated for completion by March 2015, but achieved early completion by May 2014.