GMR Infra bags Rs.5k cr rail project

A consortium led by it emerged as lowest bidder for mega Eastern Freight Corridor project

Hyderabad: Diversified infra major GMR Infrastructure Limited (GIL) which is looking to tap opportunities in railway sector has received a shot in the arm when it emerged as lowest bidder for Rs 5,080 crore Eastern Dedicated Freight Corridor.

This is the third railway project in the GMR kitty since its entry into sector. Earlier, it had bagged two projects from Rail Vikas Nigam Limited (RVNL).

“GIL-led consortium has emerged as lowest bidder in international competitive bidding for two packages of Eastern Dedicated Freight Corridor project involving construction of 417 km long double track railway line from Mughalsarai to New Bhaupur near Kanpur in UP on EPC basis,” GMR said in a statement. The Eastern Dedicated Freight Corridor extends from Ludhiana to Dankuni near Kolkata.

The Dedicated Freight Corridor Corporation of India Limited (DFCCIL), a Ministry of Railways enterprise which is implementing various dedicated freight corridor projects in the country has invited global bids for the project. It received a total of five bids for the project, wherein the GIL-led consortium has quoted a price of Rs 5,080 crore. However, the award of work will be subject to approval by DFCCIL.

“As part of Asset Light Asset Right strategy, GMR Group is not required to provide any equity for the project since it is to be implemented on EPC basis. The project, being financed by World Bank through DFCCIL, is to be completed in 45 months after award,” the company added.

GIL further said that it had already gained required experience to execute the mega project. “GIL is already implementing two railway projects for RVNL and so has requisite experience to implement the project,” it explained.

Though relatively new to railway sector, GMR Infra is a global player in airports, roads, power plants and urban infrastructure.

Meanwhile, the infrastructure major has received approval from Sebi to raise up to Rs 1,500 crore through rights issue. The company filed its application with the Securities and Exchange Board of India (Sebi) for the proposed rights issue in September this year. In a rights issue, shares are issued to existing investors as per their holding at pre-determined price and ratio.

The market regulator issued its final observations on the draft offer documents on November 17, an update in Sebi’s website noted. Issuance of observations on offer documents by Sebi is considered as a clearance for the issue.

According to the offer document, the funds raised from the issue would be utilised towards repayment of certain borrowings availed by GMR Infrastructure, investment in its subsidiary, GMR Energy Ltd, as well as for general corporate purposes. JM Financial Institutional Securities, Axis Capital, ICICI Securities and SBI Capital Markets are the lead managers to the issue.