IRB Committed to Create World-class Roads & Highways Infrastructure for India

"Our core strength lies in our ability to execute BoT road and highway projects, through our in-house domain knowledge, expertise, and capabilities. We have one of the largest BoT portfolios in the country with a total length of around 9,846 km. Our robust orderbook reinforces our confidence and enthusiasm in our construction vertical and we're committed to create world class roads & highways infrastructure for India," says Mr. Sudhir R Hoshing, Joint Managing Director, IRB Infrastructure Developers Ltd. in an interview with S.A.Faridi & Maria R.


IRB Infrastructure has carved out niche in the Roads, Highways and Bridges segment by completing numerous projects on BOT basis. Kindly retrace the fruitful journey.
Incorporated in 1998, IRB Infrastructure Developers Ltd. is India's leading infrastructure development company in the Roads and Highways sector.

Since our first project, our actions have been guided by the sole objective of delivering value. Over the years, we have reinforced our commitment by delivering large, technically complex projects across India, on difficult terrains, and in a tough industry environment.

Building seamless connections and facilitating economic and social progress, we are proud to be a part of India's transformation.

How has the business performance been of IRB in the last 3 – 4 years and what steps have kept you insulated from economic downturn?
IRB Group has been a consistent performer over the last decade. The consolidated turnover of the Group has increased from Rs.732.71 crs in FY 2007-08 to Rs.5,130.23 crs in FY 2015-16, achieving CAGR of 24%.

The Consolidated Profit after tax has increased from Rs.126.57 crs in FY 2007-08 to Rs.636.27 crs in FY 2015-16, achieving CAGR of 20%.

The consolidated net-worth has increased from Rs.1,620.70 crs in FY 2007-08 to Rs.4,827.23 crs in FY 2015-16.

Various achievements and steps taken by IRB which have kept us insulated from economic downturn in the last 3-4 years are discussed below:

Increasing our geographic presence has been our focus for several reasons. When we extend our footprint, we are expanding and diversifying our revenue streams, thereby generating sustainable value for all our stakeholders and taking us on the trajectory of higher growth. IRB's projects are now operational or under implementation in eight states, with plans in the anvil to extend operations across more states.

Recognizing the fact that execution capability was key for the success of these projects, IRB built a large equipment bank over the time consisting of sophisticated plants & equipments required for undertaking multiple projects. Keeping pace with the growing order book, the work force is also ramped up to approx. 6184 strong hands and is growing.Appropriate measures taken in design stage itself to get effective design and optimization of the cost of the Project. The good planning and utilization of resources like manpower, materials and equipment has seen the timely completion of India's first mega highway project, namely the development of 2 laning to 6 laning of NH-8 section and improvement, O&M of Ahmedabad – Vadodara Expressway within 35 months, one month ahead of schedule.


Inorganic growth through acquisition of BOT (Build, Operate, Transfer) projects in the secondary market has been an integral part of our evolving growth strategy. IRB has acquired 74% holding of MVR Infrastructure & Tollways Private Ltd in 2012. MVR Infra, a subsidiary of IRB, is the concessionaire for Omalur Salem–Namakkal BOT road project in Tamil Nadu. The project stretch of 68.625kms is located in Tamil Nadu on the busy Bangalore–Kanyakumari section of NH 7.

IRB has taken various innovative steps to secure the funding – IRB raised Rs.440 Crores through QIP in 2015 in a challenging market condition. This resulted in an equity dilution of around 5.7%. The funds utilized to finance current and future projects. In 2016, Securities and Exchange Board of India (SEBI) has approved IRB Infrastructure Developers' application for Infrastructure Investment Trust (InvIT), paving the way for launch of India's first such instrument.

The Centre has set an ambitious target of constructing 40km of road per day in 2016-17. Do you think that we have this much expertise, technologies and workforce to make this happen? How is IRB prepared to be a part of this initiative?
Infrastructure development in India is riding a new wave of optimism. To achieve the objective, the year saw the Government and the National Highways Authority of India (NHAI) taking a series of steps to revive weakening private sector interest in road projects.

So, we feel that the ambitious target of constructing 40km of roads per day in 2016-17 looks challenging but attainable. At IRB, we are proud to partner this positivity, pace and progress by bidding for BoT projects, which leverage best our in-house domain knowledge, expertise and capabilities.

Don't you think that with only Hybrid Annuity Model, the government can't build 40km of roads per day and have to review BoT/PPP model to attract private involvement? What, according to you, are the aspects government should address in the BoT/PPP model?
It will be probably a mixed bag of EPC, BoT and Hybrid Annuity Model (HAM) based on the criticality of the projects.

The challenges at present include high interest rates, delays encountered in securing environmental and other clearances, hurdles in land acquisition and various other procedural issues. Quality of DPR still remains to be improved.

What is IRB's core strength?
Our core strength lies in our ability to execute Build-Operate-Transfer (BoT) road and highway projects, through our in-house richly experienced human resources and domain knowledge.

Some of our prestigious projects include sections of the Golden Quadrilateral and the National Highways.


We have one of the largest BoT portfolios (operational projects and projects under construction) in the country with a total length of around 9,846 km. We also maintain the infrastructure assets as per concession agreement requirements, enhancing sustainability for all stakeholders – Community, Client and the Company. The Company has good debt equity ratio considering the Infrastructure industry standards.

Tell us about your orderbook and major projects in hand.
Our Order book as on March 31, 2016 stood at around Rs.10,000 crs.

Such a robust order book which is to be executed over the next 3-4 years reinforces our confidence and enthusiasm in our construction vertical.

Major projects include Sholapur Yedeshi (Maharashtra), Yedeshi Aurangabad (Maharashtra), Kaithal Rajasthan (Haryana), Karwar Kundapur (Karnataka) and Agra Etawah (Uttar Pradesh) which has recently achieved financial closure.

Technology plays a big role in executing sustainable projects. What is your equipment bank strength and what advance equipment are you planning to induct in your fleet in the near future?
IRB is having its own adequate nos. of Asphalt Plants; Wet Mix Plants; Concrete Batch Mix Plants; Crushing Plants; Crushing Plants of different capacities; Truck Mounts; Asphalt Pavers; Tandem Rollers; Pneumatic Tyre Rollers, and Sand Classifiers.


All the equipment are of latest technology to meet any challenges arising out of execution of project.

Being one of the prominent builders of the country, how do you assess government's last two years efforts to bring the infrastructure sector's glory on backtrack in general and in the roads sector in particular?
Both the Government and the National Highways Authority of India (NHAI) have focused on development of roads and highways sector of the country.

The Ministry of Road Transport & Highways has set a target of constructing 15,000 km of highways in FY17, which is more than double of the kilometers of highways awarded in FY16.

Around 25,000 km of road projects are expected to be awarded by the government in FY17, as against 10,000 km awarded in FY16.