GMR Infrastructure Ltd is readying a capital expenditure of Rs 7,000 crore for this fiscal to fund its existing and new projects.
While the Delhi airport modernisation is expected to cost Rs 3,600 crore, the company’s power projects will need Rs 2,500 crore. The airport project in Istanbul will incur an expenditure of Rs 600 crore.
A Subba Rao, chief financial officer, said, “The capex this year would be in the range of Rs 6,500-7,000 crore. There are some more projects like the road project on NH-9 from Hyderabad to Vijayawada, which would cost about Rs 2,100 crore. We have not factored in that project yet. In addition, we have a power project at Kamalanga.”
The funding for the capex will be in a debt to equity ratio of 75:25.
Currently, GMR Infra has a debt of Rs 10,000 crore at an average rate of 10.32%. Most of the debt raised for existing projects, except recent ones, is at a fixed rate.
The company is also in the process of expanding its Vemagiri power unit, which is waiting for gas supply from Reliance Industries. Once the supply begins, GMR Infra will expand its capacity by 700 mw from 387 mw now. The Andhra Pradesh unit is currently operating at 90% plant load factor (PLF).
Rao, however, refused to confirm the expansion. Estimates peg the cost of the spread at Rs 4 crore per mw added.
In the fiscal ended March, GMR Infra’s net revenue stood at Rs 4,019.22 crore, a growth of 75.15% over the previous fiscal’s Rs 2,294.78 crore. Its gross revenue was at Rs 4,476.19 crore, a growth of 66% year on year.
Profit jumped 33% in FY09 to Rs 279.45 crore, from Rs 210.08 crore the previous fiscal. Revenue from the power sector increased by 38.76% to Rs 2,138.71 crore while that from airports shot up 154.79% to Rs 1,206.24 crore. The roads sector contributed Rs 151.90 crore to revenue, an increase of 8.73% from Rs 139.70 crore in FY08.
Earnings from other sectors increased to Rs 522.37 crore, a whopping 271.90% jump from Rs 140.46 crore the previous fiscal.
However, Ebitda margins for the power sector dropped 1% to 25% mainly due to legal problems involving the Tannir Bavi unit in Karnataka. The company is locked in a legal tussle with the Karnataka government over a directive to sell power to state utilities at Rs 5.50 a unit.
“We are awaiting an order from the court to resolve the issue. In February and March, we did not register any profit from Tannir Bavi unit since we were supplying at the cost of production. We hope to find some solution to this through the court’s order,” Rao said. He said the row has cost the company Rs 60 crore in revenues.
