MEP Infrastructure Gains After Winning Toll Collection Rights From NHAI in Jharkhand

MEP Infrastructure Developers Ltd. shares rose after the company received a letter of acceptance from the National Highways Authority of India for toll collection in Jharkhand.

The company has been awarded fee collection rights at the Sau Kala Toll Plaza, in Jharkhand, according to a press release. The contract will be valid for a year and operations will commence from September 14. The company has to pay NHAI Rs 87.3 crore on a weekly basis.

“We expect a revenue of Rs 95-98 crore from this one-year toll project starting from the second week of September,” Jayant Mhaiskar, Vice Chairman & Managing Director, MEP Infrastructure Developers said in the release.

MEP Infrastructure currently has an order book of more than Rs 3,800 crore which comes under the hybrid annuity model introduced by the government. The company is expecting a return of 14-16 percent for these projects.

Hybrid annuity model was introduced by the government to rejuvenate and revive public-private partnership in highway construction.

MEP Infrastructure will also look to raise around Rs 100 crore to support their existing order book. The company will look to raise funds either through a rights issue or preferential allotment.

Shares rose 1.38 percent to Rs 44.15 after the announcement.