Coimbatore Bypass project

• 1. A presentation onCoimbatore bypass road projectcase studyBy:THE WORTHYArshiya KhanMayuri PatilUmesh SikkaSamidha ParulkarNikita Jaisinghani1 Prepared By: The Worthy

2. IntroductionFirst road project to be implemented in South India on BOT basis. Why: The bypass was expected to ease the traffic congestion inCoimbatore city , Tamilnadu and Salem-Cochin national Highwayrunning b/w Tamilnadu and Kerala. What: Construction of a 28 km long two lane bypass road, The 32.2 m new Athupalam bridge across the river Noyal, The Railway over Bridge at Chettipalayam Tamilnadu and The maintenance of the old bridge at Athupalam When: Contracted to be completed in 29 months, but completed in 22months Investment 1.04 billion Management: L&T2 Prepared By: The Worthy 3. Financing of the Project Ministry of Surface Transport (MoST) invited tenders from thePrivate Sector to Finance and implement the Construction. The Project was financed by Share Capital of Rs. 416 mn and TermLoan of Rs. 620 mn with a debt- equity ratio of 1.5:1 The financing was done by SBI, L&T finance, HUDCO, HDFC andIDBI. IDBI sanctioned Rs. 300 mn for the project in the form ofInfrastructure Bonds.4 Prepared By: The Worthy 4. The loan was given in two tranches of Rs. 150 mn each at 15% interesteach. SBI loaned Rs. 300 mn to the project. IDFC had structured a Liquidity Support for SBI5 Prepared By: The Worthy 5. Toll charges of using bypass roadTYPES OF VEHICLE Toll chargedCar. jeep& van 19Light Commercial Vehicle 28Heavy commercial vehicle 56Multi-axle vehicle 84Toll charges of using old bypassTYPES OF VEHICLE Toll chargedCar. jeep& van 5Light Commercial Vehicle 15Heavy commercial vehicle 15Multi-axle vehicle 2 6. Revenue generation Ploughed back for maintenance Lesser operating cost on fuel Reduction in distance and time Wayside facilities and amenities on road Trauma care with ambulance Growth in the economy Diversification of govt. funds Lesser Pollution, more safety8 Prepared By: The Worthy 7. Challenges Faced By LTTIL Project Structuring Pubic Consultation Biased Revenue Analysis Delays due to Queuing Local Traffic Multiple Trips Toll on Existing Bridge Enforcement9 Prepared By: The Worthy 8. Implications of State Government Poor Supportto the Project On Future Investment in the State There is no clarity between the government and the developer on theresolution of problems if the project does get into unanticipated problems. This would be amajor deterrent for private players to invest in road developmentprojects. Government is not fulfilling its role by taking action towards ensuringtoll compliance or compensating for the losses. The response from the government remains so poor , future publicprivate road projects would be in jeopardy The poor support and delayed decisions from state government causeL&T under tremendous pressure as huge funds have been borrowed infinancing the project from financial institutions which may result inadverse impacts on BOT project in the state.10 Prepared By: The Worthy 9. Key Takeaways BOT Take-out financing Force Majuere clause Importance of government support11 Prepared By: The Worthy