GF Toll Road Limited

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On January 31st 2009, the Haryana Public Works Department (PWD) signed a 17 year concession (including construction period of 2 years) with Reliance Infrastructure Limited for widening and strengthening of 66.2km toll roads in the state of Haryana, India. Under the contract, the consortium was responsible for the design, construction, finance, operation and maintenance and widening of the existing two-lane highway to a four-lane highway with paved shoulders. The project involved widening and strengthening four stretches (Road 1: Gurgaon to Faridabad, Road 2: Crusher Zone - adjacent to Gurgaon to Faridabad Road, Road 3: Ballabhgarh to Sohna and Road 4: Municipal Corporation of Faridabad (MCF) Road).The Gurgaon-Faridabad road will be four-laned, 20 m wide carriageway with 1 m earthen on either side and 2 m wide median. The existing 7 metre wide MCF road will be strengthened and widened to 10 m and the Ballabhgarh- Sohna (up to Lukhawas junction) road will be two laned with 10 m wide carriageway on both side under the project. There would be four toll plazas on the project highway after the completion of the project. One toll plaza will be on the Gurgaon-Faridabad road, one on the Crusher Zone road and two road plazas on the Ballabhgarh-Sohna road. Local non-commercial vehicles in the vicinity of the toll road, two-wheelers and tractor-trailers carrying agriculture produce were expected to be exempted from payment of toll. The expansion project, part of the initiative of linking the National Capital Region comprising of the cities of Delhi, Gurgaon, Faridabad, Noida, was expected to ease traffic congestion and give significant stimulus to trade and commerce in the entire region. Reliance Infrastructure established Gurgaon Faridabad Toll Road Private Limited, a special purpose vehicle, to implement the project. Reliance Infrastructure won the tender through competitive bidding, conducted by the Haryana PWD, by requesting for the lowest subsidy requirement - a negative grant of US$ 31 million (INR 1503 million @ 48.41 INR/USD). Seven bidders had submitted their bids for the project. Under the contract, the SPV was to recover the capital costs and operating costs including returns through tolling during the term of concession. Other bidding details were not available at the time of collection of this information. The concession agreement was signed in January, 2009. The project attained financial closure in August 26th 2009. The debt equity ratio was 75:25. The estimated capital cost of the project at the time of financial closure was US$ 160.9 million (INR 7791 mn @ 48.41 INR/USD) million. Financing comprised of a US$ 120.6 million (INR 5840 mn @ 48.41 INR/USD) 12-year term loan mandated by Axis Bank and a US$ 40.3 million (INR 1951 mn @ 48.41 INR/USD) Equity. The final bank allocation was Axis INR 1000 mn, UCO Bank INR 950 mn, Corporation Bank and Union Bank of India INR 720 mn each, Bank of Baroda INR 650 mn, Indian Bank INR 500 mn, United Bank of India INR 350 mn, Allahabad Bank INR 280 mn, and State Bank of Patiala INR 250 mn. Construction on the project began in July 2009 and was expected to be completed by 1st Quarter of FY 2012.