DBL Silwani Sultanganj Tollways Limited

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On 8th September 2011, Madhya Pradesh Road Development Corporation (MPRDC) awarded a 15-year concession (including construction periof of 2 years) to Dilip Buildcon Limited (DBL) for the strengthening, improvement,two-laning, operation and maintenance,and tolling of 75.995kms of existing Silwani-Sultanganj section of State Highway-15, in the state of Madhya Pradesh.The project was divided into 2 sections - Section-1 from Silwani to Sultanganj (0-30km) and Section-2 from Jaisinghnagar to Sagar Road (32km to 76km). 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 undivided 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. Dilip Buildcon established DBL Silwani Sultanganj Tollways Limited (DSBTL),a special purpose vehicle on 17th August 2011, to implement the project. The SPV won the tender through international competitive bidding, conducted by MPRDC,by requesting the lowest annuity payment of US$ 2.1mn (INR 94.2mn @46.7 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 47.1mn from MPRDC as well as tolling, during the term of concession. DBL would execute the fixed price EPC (INR 1150mn) for the project. The concession agreement for the project was signed on 8th September 2011. The project was expected to be financed with a debt/equity ratio of 73/27. The estimated capital cost of the project at the time of financial closure was US$ 28.7mn (INR 1341.8mn @46.7 INR/USD). Financing was expected to be comprised of a term loan of US$ 21mn (INR 980mn) and sponsor equity of US$ 7.7mn (INR 361.8mn). The actual cost incurred was US$ 31.3mn (INR 1463.1mn), the cost-overrun being financed by sponsor equity. The term loan was arranged by Punjab National Bank. Other details of financing were not known at the time of collection of this information. The project started construction on 27th February 2012 (Appointed Date) and and was slated for completion by 26th February 2014. DSSTL achieved final commercial operations date (COD) on February 28, 2013 and May 29, 2013 for Section-I and Section-II respectively, of the project highway as against Scheduled Project Completion Date (SPCD) of February 26, 2014. DSSTL received 2 regular semi-annuity (INR 94.9mn) along with 2 bonus semi-annuities (INR 172.9mn) from MPRDC within envisaged time frame.