DME Development Limited (DMEDL), a 100 per cent owned entity of the National Highways Authority of India (NHAI), has raised Rs 5,000 crore through maiden 15-year bond offering with variable coupon rates.
“The bond, with a basic size of Rs 1,000 crore plus green shoe of Rs 4,000 crore, was priced at 6.85 per cent. The coupon would be reset each quarter based on the yield on the three-month treasury bill plus fixed spread of 311 basis points,” bond dealers told Business Standard.
DMEDL was incorporated on August 29, 2020, to undertake the Delhi Mumbai Expressway Project development.
The proposed Delhi Mumbai Expressway project is one of the flagship highway projects currently being executed by NHAI. The estimated project cost for Delhi Mumbai Expressway is about Rs 87,453 crore.
DMEDL will raise the finance required for developing the Delhi-Vadodara section under an EPC contract and the upfront commitment needed in the development of the Vadodara-Mumbai section under HAM contract.
While the Delhi-Mumbai stretch is targeted to be completed by March 2023, the last section of the highway, i.e. Spur to Jawaharlal Nehru Port Trust (JNPT), is envisaged to be completed by September 2023.
As of January 2021, NHAI has incurred approximately Rs 17,000 crore towards the project. Around Rs 7,300 crore have been spent for civil construction works, while Rs 9,500 crore towards land acquisition and pre-construction activities.