DME Development Limited (DMEDL), a wholly-owned entity of the National Highways Authority of India (NHAI), has raised Rs 5,000 crore through maiden 15-year bond offering with variable coupon rates.
The bond, with basic size of Rs 1,000 crore plus green shoe of Rs 4,000 crore, was priced at 6.85 per cent. The coupon would be reset each quarter based on the yield on the three-month treasury bill plus fixed spread of 311 basis points, bond dealers said.
In February 2022, the rating agency CARE reaffirmed “AAA” with stable outlook.
The Delhi-Mumbai stretch is targeted to be completed by March 2023. The last section of the highway, i.e., Spur to Jawaharlal Nehru Port Trust (JNPT), is envisaged to be completed by September 2023.
The total estimated project cost is envisaged at about Rs 87,453 crore (including the land acquisition cost proposed to be borne by NHAI).
DMEDL will raise the finance required for the development of the Delhi-Vadodara section on EPC basis and upfront commitment required for the development of the Vadodara-Mumbai section on HAM basis.
The rating is supported by the Letter of Comfort (LoC) from NHAI in favour of the lenders financing the project.
NHAI will retain at least 51 per cent stake in the company and to infuse additional equity or arrange for term facilities in case of any shortfall in funding plan.
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