IRB Infra Wins ₹3,087 Crore NHAI Project in Odisha

Introduction to the Project Win

IRB Infrastructure Trust, a private infrastructure investment trust (InvIT) sponsored by IRB Infrastructure Developers, has secured a significant Toll-Operate-Transfer (TOT) project in Odisha. The National Highways Authority of India (NHAI) awarded the project, known as TOT-18, for an upfront consideration of ₹3,087 crore. This development marks the company's strategic entry into the Odisha market and is a key part of NHAI's ongoing asset monetisation program. The win reinforces IRB's position as a dominant player in India's highway infrastructure sector.

Project Details and Concession Terms

The project involves the tolling, operation, maintenance, and transfer of a 74.5-kilometer stretch of the Chandikhole to Bhadrak corridor on National Highway 16. This section is a crucial part of the Golden Quadrilateral, one of India's most important highway networks. The concession period is for 20 years and is structured on a revenue-linked basis. IRB Infrastructure Trust will make the upfront payment of ₹3,087 crore to NHAI after achieving financial closure. Operationally, IRB Infrastructure Developers Ltd. will serve as the project manager for the concession, overseeing its execution.

Tariff Structure and Revenue Model

The revenue model for the project is designed to provide stable and predictable returns. The annual tariff revision mechanism includes a fixed increase of 3% per year, supplemented by an additional variable component. This variable part is linked to inflation, calculated as 40% of the change in the Wholesale Price Index (WPI). This hybrid tariff structure helps mitigate inflation risk while ensuring a baseline growth in toll revenue. Tolling and operational activities are scheduled to begin from the appointed date set by NHAI.

Strategic Expansion into Eastern India

This project is a significant milestone for the IRB Group, marking its expansion into its 13th Indian state. It is the company's second major project in Eastern India, following an existing asset in West Bengal. By securing a key stretch of the Golden Quadrilateral, IRB has increased its market share in this critical national highway network to approximately 16%. This move not only diversifies the company's geographical footprint but also strengthens its presence in a region with growing economic activity and infrastructure needs.

Financial Implications for IRB Group

The TOT-18 project is expected to have a positive financial impact on the IRB Group. The company's order book is set to increase by approximately ₹1,600 crore with this addition. Furthermore, Virendra D. Mhaiskar, Chairman & Managing Director of IRB Infrastructure Developers, stated that the combined effect of the recent TOT-17 and TOT-18 wins is projected to enhance the group's toll revenues by about ₹1,000 crore in FY27. The acquisition expands IRB's aggregate asset base to approximately ₹94,000 crore, moving it closer to its near-term goal of a ₹1 lakh crore portfolio.

Management's Vision and Market Position

According to company leadership, this award places IRB on a fast track to becoming the largest private toll road developer in India by asset value. Mr. Mhaiskar highlighted that the win reinforces IRB's leading position in the TOT space, with the company having committed approximately ₹34,000 crore in upfront payments to the government across six TOT assets. This consistent success in securing large-scale projects underscores the company's financial strength and operational expertise in managing complex infrastructure assets.

Project Summary Table

Context of NHAI's Asset Monetisation Program

The TOT model is a core component of the Indian government's strategy to monetize publicly funded infrastructure assets. Under this model, the right to collect tolls on operational national highways is awarded to private entities for a predetermined concession period in exchange for a large, upfront payment. The funds raised through this program are then used by NHAI to develop new highway infrastructure across the country. IRB's active participation in this program highlights the growing role of private investment in India's infrastructure development.

Broader Portfolio and Recent Wins

With the addition of the Odisha project, the IRB Group's portfolio now comprises 28 highway projects. This includes a diversified mix of 18 Build-Operate-Transfer (BOT), six Toll-Operate-Transfer (TOT), and four Hybrid Annuity Model (HAM) projects. This win follows another major success last month when the company secured the TOT-17 bundle in Uttar Pradesh, valued at ₹9,270 crore. This pattern of securing consecutive large-scale projects demonstrates the company's aggressive growth strategy and its ability to execute it effectively.

Conclusion

IRB Infrastructure Trust's successful bid for the ₹3,087 crore TOT project in Odisha is a multi-faceted victory. It facilitates a strategic entry into a new state, strengthens its hold on the crucial Golden Quadrilateral network, and provides a significant boost to its financial metrics. The project enhances IRB's revenue visibility and solidifies its leadership in India's highway sector. The next steps will involve achieving financial closure for the project, after which tolling and maintenance operations will commence.