IRB Infrastructure Expects 20% Growth In Toll Collection In Second Half Of FY24

IRB Infrastructure Developers Ltd. said the second half of the financial year should be better than the first as traffic growth is expected to be robust, mainly due to the festive season.

"Probably, we will be touching close to 20% growth in toll collection as compared to FY23," Anil Yadav, director of investor relations, told BQ Prime in an interview. "It will be largely driven by the traffic growth."

Historically, it has been observed in previous years as well that there is a substantial uptick in traffic in the third and fourth quarters, according to Yadav.

In the engineering, procurement, and construction segment, Yadav said IRB's revenue was around Rs 4,000 crore in the previous year. "This year, we have guided around 15% growth in EPC revenue."

During the first quarter, it achieved a revenue of around Rs 1,000–1,100 crore. Traditionally, the majority of its revenue, ranging from Rs 2,800–3,000 crore, is expected in the second half, he said.

Yadav explained that this pattern was due to lower construction activity during the monsoon, with construction reaching its peak in the third and fourth quarters.

Toll collection follows a similar trend, with the first half accounting for 45–48% and the second half for 52–55% of the total annual, he said. "We should be able to achieve Rs 5,000-plus crore of revenue on (the) EPC side and tolling; we are witnessing very good growth."

Out of the Rs 33,700 crore order book of the IRB, around Rs 12,000 crore represents the executable order book for the next three years, according to Yadav.

He said the National Highways Authority of India outlined a pipeline of 3,000 km of additional projects that would be awarded in the fiscal, with about 40–45% falling under the build, operate, and transfer category.

Typically, Yadav pointed out, such projects would have to be awarded within the next four to six months as the Lok Sabha election is due next year and the code of conduct would come into effect.

On IRB's next milestone, Yadav highlighted their clear visibility into the order book for the next three years. He said the BOT projects are expected to be awarded in the next three to five months. Specifically, they will be focusing on securing more projects in the segment.