NEW DELHI: The National Highways Authority of India (NHAI) has decided to double down on monetisation of highways through the Toll Operate Transfer (ToT) model. It will offer as many as a dozen bundles of stretches that can be bid for by private companies in the current year. This compares with just four bundles offered last year, a senior official told FE.
The four bundles of assets monetized last year fetched the NHAI Rs 15,968 crore. In a departure from the usual practice, this time around, the NHAI will offer three bundles of highways for bidding in each round as against two earlier. Three bundles will be offered for bidding in every quarter as demand from the investors is high,” the official said.
The highway builder has already identified 33 highway stretches of 2,741 km that will be offered this time. Which sections will be offered under ToT and InvIT is to be decided later. These roads are spread over Uttar Pradesh, Rajasthan, Maharashtra, Andhra Pradesh, Telangana, Jharkhand, Orissa, Tamil Nadu and Bihar. A 4.4 km section of the Badarpur elevated corridor will also be on offer.
Last year for bundles 11, 12, 13 and 14 bids had come from the likes of KKR-backed Highways Infrastructure Trust, Cube Highways, IRB Infrastructure Trust, Abu Dhabi Investment Authority-backed funds, National Investment and Infrastructure Trust (NIIF) and Adani Group.
The aggression on ToT comes as NHAI chases a Rs 54,000 crore target for monetisation this financial year, which is much higher than Rs 40,227 achieved last year. Of the FY 25 target, Rs 8,000 is expected to come from project based financing and Rs 46,000 crore from ToT and Infrastructure Investment Trust.
In 2023-24, InvIT’s share in monetisation was Rs 15,700 crore. According to analysts on an average the realisation from monetisation of every kilometre of highway works out to around Rs 22 crore. The amount, however, varies depending on the traffic density and the user base- whether it is used more by personal vehicles or commercial vehicles.
The tendering process for two ToT bundles 15 and 16 is already on. In Bundle 15 one 124 km stretch on four lane Trichy-Tovrankurichi-Madurai section is on offer while in Bundle 16 two stretches totalling 251 km on the Hyderabad-Nagpur corridor in Telangana have been bunched together. The process for monetisation of these highways will be completed in the next few weeks and the next round of bids for the three bundles will come in June, the official said.This financial year the three bundles that will be offered for bidding at one go will be big, medium and small as against big and small till previous year.
The highest bidder for highways through the ToT route is allowed to collect the toll on the stretches for 20 years in lieu of an upfront payment. They are also required to maintain and operate these stretches. The first award of highways under the ToT model was done in 2018. Since then Rs 42,334 crore has been raised through this route by transferring 2287 km of highways to outside investors.
Source: The Financial Express