The project will soon tie-up with other institutions for the balance debt requirement of Rs 38,733 crore, an NHAI official said. The National Highways Authority of India (NHAI) has set up the fully owned Delhi-Mumbai Expressway Developers Ltd (DMEL) in its bid to bring in greater financial discipline by raising debt at the SPV (Special Purpose Vehicle) level instead of at NHAI level.
Earlier, when NHAI used to raise the debt at the authority level, it could spend money in all projects, both financially viable and unviable stretches. Sources said now under this mechanism, the debt raised for viable projects will be invested in such works while the less viable projects would be executed using budgetary allocation.
The highways authority plans to set up similar SPVs or bring more expressway projects under the DMEL to raise adequate finance for construction of such stretches.
The 1,276 km greenfield expressway with estimated investment of Rs 87,453 crore is scheduled for completion by March 2023 and one of the stretches to JNPT would be completed by September, 2023. During the construction period, the total capital expenditure is estimated to be Rs 53,849 crore and it will be a combination of debt and equity, with the total debt at Rs 48,464 crore.
DMEL will repay the debt from the toll revenue that will be generated from the expressway. For viability of the model, NHAI will add five operational toll plazas on the existing Delhi Mumbai highway as a sweetener to the SPV.
Rating agency Crisil has estimated that the longest expressway has the monetization potential between Rs 50,000 and Rs 80,000 crore. Moreover, the lenders face no risk in this SPV as it is fully owned by the NHAI, a statutory entity of the Central government.