IRB Infrastructure developers ltd

8/7/2019 IRB Infrastructure developers ltd

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B Y G R O U P 7 -

A P U R V S H A R M A

D E V D U T T A N A N D I

H E M A N T H K .

K O U S T U B H C H O U B E Y

S W A T I S I N H A



CONTENTS

y INTRODUCTION

y INDUSTRY OVERVIEW

y COMPANY OVERVIEW

y FINANCIAL ANALYSIS

y TECHNICAL ANALYSIS

y FUTURE OUTLOOK

y CONCLUSION



IRB INFRASTRUCTURE DEVELOPERS LTD-An Introduction

y IRB Infrastructure Developers Ltd. is country¶s leadinghighway construction company founded in Mumbai in 1938.

y It is the part of IRB Group and is also headquartered inMumbai, Maharashtra.

y

The Company was incorporated as a private limited company ³DVJ Leasing and Finance Private Limited´ on July 27, 1998under the Companies Act, 1956. The name of the Company was changed to ³IRB Infrastructure Developers PrivateLimited´ on 8th November, 2006, which was decided duringthe shareholder¶s general meeting.

y

On 25th

November, 2006, the Company became a PublicLimited Company and the word ³private´ was deleted from itsname.

y Mr. Virendra D. Mhaiskar is the chairman & ManagingDirector of the Company.



INDUSTRY OVERV IEW

y The Indian infrastructure industry is playing the key rolein the nation's progress towards achieving the status of "developed nation" from "developing nation".

y

The Indian government is aggressively focused on roaddevelopment and expects potential investments worthUS$ 70bn over 2007±12, which is close to double theinvestments made in the sector during 2002±07 (Rs1,450bn: US$ 40bn).

y Out of this investments, about 55% of the funding isexpected to come from the private sector, withgovernment support for the balance.



INDUSTRY OVERV IEW

y National highways, which comprise 2% of the roadnetwork, carry 40% of the road traffic. The 11th Five YearPlan charts out a total investment outlay of Rs 725bn forcentral sector roads.

%5($.832),19(670(176,17+(7+ 3/$1



COMPANY OVERV IEW

y IRB Infrastructure is a Rs. 1900 crore company and is theIndia¶s largest toll road operators, which is constructed andmaintained over 1150 km of roads.

y IRB Infrastructure has a portfolio of 14 BOT road projects, of

which 11 are operational, 2 are under construction and 1 is yetto achieve financial closure. The capitalized cost of theseprojects is Rs 64.7 billion, funded through equity of Rs 13.3billion and the balance through debt.

y Despite the difficult market conditions, the company has been

able to achieve financial closure for its Rs 27 billion Surat-Dahisar project, although with a delay of three months.

y The aggregate size of all BOT projects (both completed andunder execution) is around Rs. 33,000.00 million.



COMPANY OVERV IEW

SUBSIDIARIES-

BOT PROJECTS :

IRB Surat-Dahisar Toll way Pvt. Ltd. IDAA Infrastructure Pvt. Ltd. (Bharuch-Surat) Mhaiskar Infrastructure Pvt. Ltd. (Mumbai-Pune) Ideal Road Builders Pvt. Ltd. (Thane-Bhiwandi etc.) Thane Ghodbunder Toll Road Pvt. Ltd. ATR Infrastructure Pvt. Ltd. (Pune-Nasik)

Aryan Toll Road Pvt. Ltd. (Pune-Solapur) IRB Kolhapur Integrated Road Development Company Pvt. Ltd. NKT Toll Road Pvt. Ltd. IRB Infrastructure Pvt. Ltd. MK Toll Road Pvt. Ltd.



COMPANY OVERV IEW

ENGINEERING & CONSTRUCTION :

Modern Road Makers Pvt. Ltd.

REAL ESTATE : Aryan Infrastructure Investments Pvt. Ltd.

HOSPITALITY :

Aryan Hospitality Pvt. Ltd.

IRB Infrastructure Developers Ltd has entered into a pactwith Indian Hotels Co Ltd to construct and operate a Gateway Hotel for the latter at Kolhapur in Maharashtra.





FINANCIAL ANALYSIS

y IBR has significant increase in current asset year on yearlike an increase of 146.1% on 2010 as compared to 2009this is mainly due to increase in loans and advances.

y They don¶t maintain any inventory as material purchased

will be immediately used for their day to day business(construction) activities.y In case of Sundry Debtors when compared to previous

year the debtors time period has been reduced they aremaintaining the liquidity by collecting the cash fromdebtors as soon as possible.

y They have maintained the liquidity, increase in cashposition is moderate and in case of creditors they haveincrease the creditors such that they can use the cash forbusiness.



FINANCIAL ANALYSIS

y Their net sales increases year on year .Their profits is alsoincreasing, for the first time in 2009 they have given theDividend. Even though the company enjoys the profit growthit is not from the operations, the profit figures are purely based to other recurring income.

y The company operations are not well because the sellingexpense when compared to previous year increases personalexpenses, administrative expenses increases, even thoughemployee cost increases at around 41%.

y The company is much focused in generating income evenfrom other sources in addition to its business activities. Themajor portion of profit of the company is covered by theincome from investments.

y The share prices for the past one year fluctuate between 308-295 as its price objective for its share has been fixed at Rs 324.



TECHNICAL ANALYSIS

y IRB Infra share price after listing around Rs. 200 in Feb 08 had fallento Rs. 68 in Nov 08 since then it is in recovery mode & crossed theearlier peak of Rs. 220 and made a new all time high of Rs. 278 in Nov 09. Since then consolidating sideways, as share price has broken outthe Head & Shoulder pattern at Rs 220 and the next target is Rs. 370. Ithas a support price around Rs. 230. Long term trend is at Rs. 350.Medium term trend is at Rs. 324, one can accumulate the share at thelevel of 250.

Script

Current PriceLong Term TrendTarget

IRB Infra

Rs 278Rs 370.85Rs 324



F UTURE OUTLOOK

y IRB has one of the largest domestic BOT project portfolios in theRoad and Highway Sector comprising 16 projects of which 10 areoperational. In light of the immense opportunities that exist in theRoad Sector in the near future, IRB¶s vast experience and inter-

dependent business model, we maintain our bullish stance on thecompany¶s performance.

y As predicted by Meryll Lynch, it is good growing company. Weexpect a significant jump in revenues and earnings, at a CAGR of 59% and 49% respectively over FY08-FY11, once the Bharuch-Surat

and Surat-Dahisar road projects start contributing to IRB¶s tollincome. Since financial closure has been achieved, revenues fromSurat-Dahisar will kick in from February ¶09 at the rate of Rs 10mnper day, post revenue sharing with the NHAI (38% of toll revenue inthe first year). BOT projects contribute ~46% of the company¶srevenues but 70% of earnings in FY10E.



F UTURE OUTLOOK

y Of the National Highway Development Programme(NHDP) length of 53,100 km, projects completed / underimplementation stands at 19,812 km; and balance 33,130km is yet to be awarded.

y Has to continuously operate in an ever increasing market,as newer players have led to tougher competition andbidding for projects.

y New Govt. guidelines will also force IRB to rethink their

strategy in terms of the viability of projects.y Most new projects being offered by the NHAI require very

heavy project costs.(1000 crore or more)



F UTURE OUTLOOK

y Closure occurs when there is legally bindingcommitment of private sponsors to mobilize fundingor provide services. The definition of financial or

contractual closure varies among types of privateparticipation as a result of availability of publicinformation.



CONCLUSION

y IRB Infrastructure Developers Ltd. was incorporated tofund the capital requirements of the IRB Groupinitiatives in the infrastructure sector.

y Liquidity position for the current year is favourable. The

solvency position of the company is existent. This can beextracted by saying that the company used its own fundsfor meeting the investments and financial costs.

y Profits are mainly dependant on other income sources

but not the operation.y For the long term assets and liabilities, the debt equity

ratio is fairly well as the company is using its own funds;therefore it faces low liquidity risk.

y Net working capital is increasing over the period of time.



REFERENCES

Websites :y http://www.irb.co.iny http://company.monsterindia.com/irbinin/y http://www.indiainfoline.comy

http://profit.ndtv.com/company/notices/irb-infrastructure-developers-ltdy http://www.business-standard.com/india/y http://money.rediff.com/y http://www.capitaline.com/user/framepage.asp?id=1y

http://www.investopedia.com/y http://www.wikipedia.org/Research Reports:y http://www.iimcal.ac.in/y http://www.bfsl.co.in/Pdf/



IRB Infrastructure developers ltd

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