IVRCL to sell assets including Chennai Desalination Plant

Infrastructure major IVRCL plans to sell some more assets as part of its second round of debt-reduction exercise, a senior company official said here yesterday.

"We will put up projects like Jalandhar-Amritsar National Highway project in Punjab and Chennai Desalination Plant for sale," IVRCL Chairman E Sudhir Reddy said, adding that some development is expected on this front in next nine months.

"Three parties have been showing interest in the desalination plant, but numbers are yet to come from them. No agreement has been signed yet, but the process has begun," Reddy said, answering a shareholder's query at the company's annual general meeting yesterday.

The Chennai desalination plant, with a capacity to purify 100 million litres of sea water everyday, was set up at an investment of Rs 600 crore in 2010.

Recently, IVRCL sold three highway projects it developed on NH-47 in Tamil Nadu to Tata Group company TRIL Roads Pvt Ltd (TRPL) in a bid to reduce debt in its books which were denting profits.

Reddy said the company's debt would be reduced by Rs 1,100 crore, besides getting back around Rs 450 crore of its equity invested in road projects.

IVRCL has a consolidated debt of around Rs 6,100 crore as on March 31, a senior company official said.

The company suffered a Rs 102-crore loss during FY 2013 on gross turnover of Rs 3,579 crore due to high interest and finance costs pegged at Rs 348 crore during the fiscal.

"In nine months, we are hopeful of selling assets. We will not bid for any BOT projects till the interest regime is stable," he said, about the time frame for the second round of sales.

Three road projects already sold by IVRCL include Salem toll way, Kumarapalayam toll way and IVRCL Chengapally toll way, which is being built on a build-operate-transfer (BOT) basis at a cost of Rs 2,200 crore, IVRCL said earlier.

IVRCL is also working on some more BOT road projects which will reach their final stages in six months, Reddy said.

The 155-km Indore-Jhabua road project will be ready in next six months and become operational, he said.

The company also plans to commence commercial operations of its Baramati-Phaltan road project in Maharashtra, Reddy said.