Sep 18 2023, 15:06

BHARATMALA PROJECT PUSHES NHAI


“The asset monetisation program is crucial to execution and implementation of Bharatmala Project,” says Maulesh Desai, director at Care Ratings.

According to Care Ratings, NHAI’s external borrowings have increased from INR75,385 crore (outstanding as of March 2017-end) to INR3.48 lakh crore as of March 2022. At the end of FY23, this figure had slightly reduced to INR3.43 lakh crore, says Desai. The government has asked NHAI to not tap into external borrowing for FY23, FY24. To fund its ambitious Bharatmala Project and to even lower its leverage, the NHAI will need to monetise its assets.
A road asset InvIT is best suited for private investors in the current scenario and the NHIT has some of the leading long-term investors holding its units. This is a product that requires extremely long-term investors who are ready to wait for decades and do not look for instant gratification. 

 IRB InvIT, the only publicly listed InvIT launched in 2017, has struggled to find favour with retail investors as they could not understand the product. But unlike IRB, the NHAI InvIT is backed by the government of India and that could comfort investors. 
NHAI has three ways to do so:


•	A type of leasing of toll roads under Toll-Operate-Transfer (TOT) contracts.

•	Securitisation of toll revenues, and

•	Through its InvITs (Infrastructure Investment Trusts), which require sophisticated investors who understand the risk-return profile of these products.

source:et 

Sep 18 2023, 10:47

AVIATION: lessons from the demise of private airlines



The failure of their flashy ventures leaves an indelible blemish on the reputation of business tycoons. But beyond that, what really matters is the extent of the damage such incidents cause. The question is: how much of the public’s money gets recovered in debt? And more importantly, are there any lessons to learn from these debacles?

What numbers say
Data compiled by ET Prime from multiple sources including court filings shows that the three private airlines mentioned above owe around INR50,000 crore to bankers, vendors, aircraft lessors, travel agents, employees, trainee pilots, and passengers.

Last month, India’s aviation sector completed two decades since the launch of the country’s first low-cost airline, Air Deccan. In the industry’s extremely turbulent flight since then, three major airlines run by India’s biggest corporate barons — Mallya’s Kingfisher, Goyal’s Jet, and Nusli Wadia’s Go First — have all collapsed like a pack of cards. And that leaves behind only two contemporary airlines, IndiGo and SpiceJet, both launched between 2003 and 2006.

The sector evolves a long term risk oriented,high gain but very high risk.

source:et