58 slides from Irb Infrastructure Developers's earnings presentation, Jun 1, 2023
Slide 1: Investor Presentation | Q1FY24
Investor Presentation | Q1FY24 India’s First Multi-National Infrastructure Company in the Highways Sector Hyderabad Outer Ring Road
Slide 2: Table of Contents
Table of Contents Financial Highlights Page 2 Result Highlights Page 4 Business Overview Page 9 IRB Parent Overview Page 25 Private InvIT Overview Page 33 Public InvIT Overview Page 39 Appendix – Additional Financial Info Page 46 Appendix II – Sector Overview Page 50
Slide 3: Financial Highlights for Q1FY24
Financial Highlights for Q1FY24 • Mumbai Pune and Ahmedabad • Strong financial position: • Rated among the top Infra Companies Vadodara Projects sound revenue Consolidated Net Debt 100.09 Bn, in India for ESG: growth +15% YoY for Q1FY24 0.74x Net Debt/Equity, with strong Rating Criteria CY PY liquid
Slide 4: Result Highlights
Result Highlights Private & Confidential
Slide 5: Financial Summary (Quarterly YoY)
Financial Summary (Quarterly YoY) INR in Million Total all segments Construction Segment BOT Segment Particulars Q1FY24 Q1FY23* Q1FY24 Q1FY23 Q1FY24 Q1FY23 Revenue 17,455 19,954 11,329 14,680 6,126 5,274 EBITDA 8,891 11,315 3,433 6,470 5,458 4,845 EBITDA margin 51% 57% 30% 44% 89% 92% Financial expe
Slide 6: Financial Summary (Yearly)
Financial Summary (Yearly) INR in Million Total all segments Construction Segment BOT Segment Particulars FY23 FY22 FY23 FY22 FY23 FY22 Revenue 67,033 63,554 45,804 44,786 21,229 18,768 EBITDA 35,307 33,492 15,817 16,418 19,490 17,075 EBITDA margin 53% 53% 35% 37% 92% 91% Financial expenses 15,146 1
Slide 7: Financial Summary – Net cash for FY23
Financial Summary – Net cash for FY23 Aggregate dividend declared for FY23 is Rs. 1.2 Bn 6
Slide 8: Consolidated Financials: Strong Track Record
Consolidated Financials: Strong Track Record REVENUE (INR MN) EBITDA & MARGIN (INR MN) 53% 53% 45% 49% 70,472 67,033 33,492 35,307 63,554 31,664 54,875 27,016 57% 51% 19,954 17,455 11,315 8,891 FY 2020* FY 2021* FY 2022 FY 2023 Q1FY23** Q1FY24 FY 2020* FY 2021* FY 2022 FY 2023 Q1FY23** Q1FY24 NET DE
Slide 9: Business Overview
Overview Business Private & Confidential
Slide 10: Integrated Highway Developer Connecting India by Developing World Class Highway Infrastructure
Integrated Highway Developer Connecting India by Developing World Class Highway Infrastructure Pan India presence c. 22 years c. 20% INR 700 bn+ Weighted Of Golden 11 Highway asset 13,739 lane average Quadrilateral States in India base, one of the KM residual owned and where assets largest in India
Slide 11: Owns and Manages c. 14,000 Lane KM of Roads across 11 States in India
Owns and Manages c. 14,000 Lane KM of Roads across 11 States in India India’s leading portfolio of road assets (lane KMs)1 Under construction Operational 13,739 2,161 11,578 8,400 8,400 5,473 5,363 5,473 4,510 3,398 3,398 1,710 1,212 853 1,710 1,212 IRB Cube Indinfravit Trust Adani Oriental HIT (KKR
Slide 12: Fully Integrated Player with In-House Design, Construction, Operations and Maintenance Capabilities
Fully Integrated Player with In-House Design, Construction, Operations and Maintenance Capabilities Highly evolved design capabilities In-house capabilities, with a pool of through 40+ years of experience expert workforce, to carry out EPC Use of high-grade polymer modified (Construction) and
Slide 13: Efficient O&M Practices, Employing Latest Technology, With a Strong Focus on ESG
Efficient O&M Practices, Employing Latest Technology, With a Strong Focus on ESG Technology driven maintenance regime Site level data capture Predictive analytics Timely preventive & corrective maintenance Benchmarking with global standards Real time operations, monitoring & control ESG comp
Slide 14: Supported by Marquee Financial and Strategic Investors
Supported by Marquee Financial and Strategic Investors The largest equity fund raise by a listed Indian infrastructure developer in the roads and highways sector Ownership structure post transaction Access to technical expertise, global experience and long term capital 1 ‒ Cintra brings in 50+ years
Slide 15: Only Integrated Development Platform in India Catering to Shareholders with Diverse Risk Appetite
Only Integrated Development Platform in India Catering to Shareholders with Diverse Risk Appetite Distribution1 Strategy: To Offer HAM Distribution1 assets to Public InvIT after Construction completion Holdco 16% Margin + / - WC 100% 100% BOT / TOT / HAM CONSTRUCTION Private InvIT (IRB 51%, 5 Assets
Slide 16: Approach adopted by analysts for valuation of Integrated Developer Model
Approach adopted by analysts for valuation of Integrated Developer Model Particulars Methodology Value of concession Business DCF of FCFE over concession life Value of Construction Business PE Multiple or EV/EBIDTA Value of Non core assets (Land bank and airport) Multiple on Investment Total Value o
Slide 17: Value evolution for a typical BOT Concession over its life cycle
Value evolution for a typical BOT Concession over its life cycle 16
Slide 18: Current Ratings for Long Term Credit Facilities
Current Ratings for Long Term Credit Facilities IRB Infrastructure Developers Modern Road Makers Private 1 2 Limited Limited IND AA- / Stable CARE AA- / Stable Crisil AA- / Stable IRB MP Expressway Private Meerut Budaun 3 4 Expressway Limited Limited Ind AA / Stable Ind A- / Stable Pathankot Mandi I
Slide 19: Share Price Performance
Share Price Performance DEC 2021: Cintra & GIC close IRB transaction OCT 2022: Sale of VK1 IRB share price (rebased to 100) HAM asset and achieved 600.0 DEC 2021: IRB is awarded Ganga Expressway Appointed date for FEB 2021: Raised INR APR 2021: Awarded 1 21.9 bn through NCD new HAM project and Ganga
Slide 20: Board Driven Robust Governance Policies
Board Driven Robust Governance Policies Policies Committees Environment policy Corporate Social Responsibility Committee Code of Conduct Risk Management Committee ESG Committee of Management Assurance ESG Commitments Human rights Policy Corporate Social Responsibility Policy Health
Slide 21: Projects, Spread Across India, for Optimal Risk – Return Mix
Strategic Focus: Bid for a Diversified Portfolio of BOT, TOT and HAM Projects, Spread Across India, for Optimal Risk – Return Mix 1 Bid for new assets 2 Diversify presence NHAI expected to award HAM projects to the tune of INR 4,000 bn, BOT projects worth INR Strategically expand its presence ou
Slide 22: Constantly Evolving EPC Capabilities: Moving Up the Project Complexity Value Chain
Constantly Evolving EPC Capabilities: Moving Up the Project Complexity Value Chain, Successfully Raising Funds at Crucial Junctures 1977 1995 2004 2008 2016 2017 2018 2020 2021 2023 Length: Length: 1,168 1,234 LKM LKM Cost: INR Cost: INR 11 bn Raised INR 90 bn Raised 9.45 bn Length: INR 50 bn throug
Slide 23: Strong Focus on Protecting the Environment and Giving Back to the Community
Strong Focus on Protecting the Environment and Giving Back to the Community Ferrovial is a sustainability champion, ranking highly in various indices… IRB has a strong focus on environment, sustainability and community, which is expected to be further strengthened through Ferrovial’s expertise Fer
Slide 24: Business Responsibility and Sustainability Reporting, Mandatory for Listed Companies
Business Responsibility and Sustainability Reporting, Mandatory for Listed Companies FY23 Onward1, to Bring About Reporting Transparency Business responsibility and sustainability reporting (BRSR) is intended towards having quantitative and standardized disclosures on ESG parameters, to enable compa
Slide 25: IRB Parent Overview
Overview IRB Parent Private & Confidential
Slide 26: Strong In-house Project Design, Execution and Maintenance Capabilities
Strong In-house Project Design, Execution and Maintenance Capabilities Strong construction track Efficient project execution Ability to independently record capabilities Large equipment bank bid for large contracts In-house O&M capabilities Access to best global One of the largest fleet of Exp
Slide 27: IRB is Well Poised to Maintain Margins with Adequate Escalation Provisions
IRB is Well Poised to Maintain Margins with Adequate Escalation Provisions for Raw Material Prices Cement price (INR per bag) 266 269 258 261 246 246 246 250 250 246 246 242 Jul-22 Aug-22 Sep-22 Oct-22 Nov-22 Dec-22 Jan-23 Feb-23 Mar-23 Apr-23 May-23 Jun-23 The Major material prices are Reinforcem
Slide 28: WPI Linked Toll Rates Provide Protection to Toll Cash Flows
WPI1 Linked Toll Rates Provide Protection to Toll Cash Flows in an Inflationary Environment with Increasing Interest Rates Toll rates are linked to inflation For NHAI projects that were bid for after 2008, toll rate is revised annually in April at 3% fixed rate, plus 40% of change in WPI for Dec
Slide 29: Healthy Mix of BOT, TOT and HAM Projects
Healthy Mix of BOT, TOT and HAM Projects Original S. Project cost Lane # of Project Counterparty State Concession Status No. (INR mn) KMs Lanes ( in Years) 3 BOT 1 Ahmedabad Vadodara NHAI Gujarat 48,800 987 6 25 Tolling start: January 1, 2013 projects Received Appointed Date as 2 Ganga Expressway –
Slide 30: Mumbai Pune TOT – A Crown Jewel in IRB’s Portfolio
Mumbai Pune TOT – A Crown Jewel in IRB’s Portfolio One of the busiest highway corridors in India which is a part of the Golden Quadrilateral on the Mumbai-Chennai arm Project highlights Project snapshot Project snapshot Tolling operations, maintenance and transfer of Road YCEW - 94 Km , NH-48 –
Slide 31: Nehru ORR TOT – New addition in IRB’s Portfolio
Nehru ORR TOT – New addition in IRB’s Portfolio 158 km, 8 lane access-controlled corridor in one of the youngest state of our Country Project highlights Project snapshot Project snapshot Road 158 km (1,264 lane kms) Tolling, Operation, Maintenance & Transfer of length Overview Nehru Outer Ring R
Slide 32: BOT Toll Revenue Comparative – IRB Projects
BOT Toll Revenue Comparative – IRB Projects Amount in INR mn MUMBAI - PUNE ** Quarter 2019-20 2020-21* 2021-22* 2022-23 2023-24 % Variance Jun 2,470 1,167 2,373 3,606 4,238 17.5% Sept 939 2,191 3,055 3,347 Dec - 3,106 3,462 3,687 Mar 621 3,221 3,342 3,605 Total 4,031 9,685 12,232 14,245 4,238 Mum-Pu
Slide 33: IRB Private InvIT
InvIT IRB Private Private & Confidential 32
Slide 34: Private InvIT: IRB Infrastructure Trust (Portfolio of 13 Assets)
Private InvIT: IRB Infrastructure Trust (Portfolio of 13 Assets) Asset location Asset overview Project Sr. cost Lane Project State Status No. (INR KM mn) 1 Goa Kundapur Karnataka 34,770 758 PCOD achieved Haryana 2 Solapur Yedeshi Maharashtra 15,900 395 COD achieved 3 Yedeshi Aurangabad Maharashtra 4
Slide 35: Strong Recovery in Toll Collection Across Projects
Strong Recovery in Toll Collection Across Projects Daily toll collection (INR mn) 64.6 64.9 63.8 62.3 63.2 65.0 62.3 61.4 55.1 57.2 57.0 53.6 52.5 53.0 51.9 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar FY23 FY24 Total toll collection (INR mn) 5,866 1939 1915 2012 1868 1958 1904 1931 4,819 1709 17
Slide 36: BOT Toll Revenue Comparative – Private InvIT Projects
BOT Toll Revenue Comparative – Private InvIT Projects Amount in INR mn ** Gulabpura Chittorgarh Hapur Moradabad Quarter 2019-20 2020-21* 2021-22* 2022-23 2023-24 % Variance Quarter 2019-20 2020-21* 2021-22* 2022-23 2023-24 % Variance Jun 419 217 329 822 931 13.4% Jun 132 180 310 388 767 97.9% Sept 3
Slide 37: BOT Toll Revenue Comparative – Private InvIT Projects
BOT Toll Revenue Comparative – Private InvIT Projects Amount in INR mn Kishangarh Gulabpura Agra Etawah Quarter 2019-20 2020-21* 2021-22* 2022-23 2023-24 % Variance Quarter 2019-20 2020-21* 2021-22* 2022-23 2023-24 % Variance Jun 294 146 209 303 615 102.6% Jun 206 150 419 550 588 6.9% Sept 279 248 2
Slide 38: BOT Toll Revenue Comparative – Private InvIT Projects
BOT Toll Revenue Comparative – Private InvIT Projects Amount in INR mn Karwar Kundapura Palsit Dankuni # Quarter 2019-20 2020-21* 2021-22* 2022-23 2023-24 % Variance Quarter 2021-22 2022-23 2023-24 % Variance Jun - 93 156 298 349 17.2% Jun - 545 469 -13.8% Sept - 156 197 262 Sept - 498 Dec - 218 250
Slide 39: IRB Public InvIT
InvIT IRB Public Private & Confidential
Slide 40: Structure of Public InvIT
Structure of Public InvIT Fund structure Unit holders holding more than 1% as on Mar 31, 2023 % S. No. Unit holder Investor in units of trust holding IRB INFRASTRUCTURE DEVELOPERS 1 15.97 LIMITED Quarterly distribution 2 GOVERNMENT OF SINGAPORE 7.58 ADITYA BIRLA SUN LIFE TRUSTEE Invests in Distribut
Slide 41: Public InvIT (Portfolio of 6 Assets)
Public InvIT (Portfolio of 6 Assets) Listed in May-2017 with initial portfolio of six operational assets; seventh asset was transferred in Sep-2017 Two assets were successfully completed and handed back to the authority. One HAM asset acquired in Oct-2022 BOT-Toll assets with proven traffic hi
Slide 42: Strong Recovery in Toll Collection Across Projects
Strong Recovery in Toll Collection Across Projects Daily toll collection (INR mn) * 40 27.7 27.9 27.6 27.4 27.0 25.8 25.6 25.7 25.6 25.9 26.2 24.2 24.2 24.8 23.5 20 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar FY23 FY24 Total toll collection (INR mn) * 865 827 2,523 832 2,340 814 794 775 771 770
Slide 43: Financial Highlights
Financial Highlights Gross income1 (INR mn) EBITDA (INR mn) 81% 80% 80% 83% 80% 12,701 14,003 12,334 11,609 11,584 10,386 9,989 10,218 9,343 8,279 FY19 FY20 FY21 FY22 FY23 FY19 FY20 FY21 FY22 FY23 EBITDA margin Net distributable cash flow (INR mn) Net debt (INR mn) 0.2x 0.2x 0.2x 0.2x 0.3x 7,639 22,
Slide 44: Unit Price Performance Since Inception
Unit Price Performance Since Inception Price (rebased to 100) Distribution per unit (DPU) 300.0 INR FY18 FY19 FY20 FY21 FY22 FY23 DPU 10.6 12.3 10.0 8.5 9.0 8.0 Yield1 11.5% 16.4% 17.6% 20.8% 16.1% 13.4% 200.0 107% 100.0 16% - May-20 Aug-20 Nov-20 Feb-21 May-21 Aug-21 Nov-21 Feb-22 May-22 Aug-22 Nov
Slide 45: Key Takeaways
Key Takeaways 1 Large pipeline of future growth with upcoming national & state highway bids 2 Proven credentials in the highways space Significant improvement in financial metrics post GIC and Cintra –transaction ; further supported by 3 monetization of VK1 HAM Asset 4 Access to complementary capabi
Slide 46: Appendix I: Additional Financial Information
Appendix I Additional Financial Information Private & Confidential
Slide 47: Financial Summary (Quarterly - QoQ)
Financial Summary (Quarterly - QoQ) INR in Million Total all segments Construction Segment BOT Segment Particulars Q1FY24 Q4FY23 Q1FY24 Q4FY23 Q1FY24 Q4FY23 Revenue 17,455 16,989 11,329 11,514 6,126 5,475 EBITDA 8,891 8,377 3,433 3,325 5,458 5,052 EBITDA margin 51% 49% 30% 29% 89% 92% Financial expe
Slide 48: Offshore Bond Issue – Covenant Structure
Offshore Bond Issue – Covenant Structure Surplus IRB 100% Investments Business segment I 100% 51% 49% GIC Toll & HAM Private InvIT affiliates Business segment II 16% Construction Public InvIT Mumbai Pune TOT Engineering, construction, operation and maintenance of Ahd Vadodara BOT Key highlights Proj
Slide 49: Leverage Summary – Bond Covenant
Leverage Summary – Bond Covenant INR in Mn TTM ending TTM ending Particulars June 30, 2023 March 31, 2021 Business Segment I: Toll & HAM Revenues 21,534 16,112 EBITDA 16,943 14,532 Gross Debt 90,297 97,711 Business Segment II : Construction + Surplus from other businesses (Combined Gp) Revenues 43,1
Slide 50: Appendix II: Sector Overview
Appendix II Sector Overview Private & Confidential
Slide 51: Indian Road Sector Outlook
Indian Road Sector Outlook Healthy awarding activity seen during last 2-3 years While pace of construction slightly reduced in FY23, Consistent increase in Budgetary estimated to be maintained going forward.. improvement is expected going forward allocation 00’ KM KM 13,298 13,000 Capital Outlay for
Slide 52: Attractive Sector with Strong Underlying Fundamentals
Attractive Sector with Strong Underlying Fundamentals Indian highways exhibit strong fundamentals, secular growth trends and stable regulations Growing urbanization and rising personal disposable income Bharatmala Pariyojana Phase 1 Secular growth Amongst the fastest growing vehicle markets In
Slide 53: Roads Sector has a Significant Share in Government’s Infrastructure Development Pipeline
Roads Sector has a Significant Share in Government’s Infrastructure Development Pipeline National Monetization Pipeline PM Gati Shakti Master Plan Monetization of INR 6 tn of brownfield assets, with stable revenue streams, Construction of INR 111 tn of greenfield assets in the core infrastructur
Slide 54: Regulatory Overview
Regulatory Overview Variety of PPP Models with a highly evolved & stable regulatory regime backed by well established contract structure through NHAI Model Concession Agreement NHAI has successfully attracted investments in the roads sector through and array of PPP models Build Operate Transfer (BOT
Slide 55: Bankable Concession Terms
Bankable Concession Terms Key positive of Indian Roads & Highways sector Typical terms Details NHAI is an agency appointed by the federal government for development of roads and highways in India NHAI as counterparty NHAI is a quasi-sovereign entity with a ‘AAA’ rating Well-funded by federal g
Slide 56: While the Sector has Witnessed Subdued Bid Activity Recently, Outlook Remains Positive
While the Sector has Witnessed Subdued Bid Activity Recently, Outlook Remains Positive Key sector trends 1 Weak bidding activity improved in FY23 2 Increased competition intensity 3 Asset Monetization Pipeline: A mixed bag Bids tendered for road projects (INR bn) FY23 witnessed continued Upto FY
Slide 57: Disclaimer
Disclaimer Except for the historical information contained herein, statements in this presentation and any subsequent discussions, which include words or phrases such as ‘will’, ‘aim’, ‘will likely result’, ‘would’, ‘believe’, ‘may’, ‘expect’, ‘will continue’, ‘anticipate’, estimate’, ‘intend’, ‘pla
Slide 58: THANK YOU
THANK YOU For Further Information, Kindly Contact : Investor relations : Investors.relations@irb.co.in 57