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, GIPL that runs the controversy-plagued Paliakkara toll plaza has returned to profit, earning a net profit of Rs17crore for the financial year 2022-23 (FY23) compared with a net loss of Rs47 crore for the previous year.
KOCHI: Guruvayoor Infrastructure Pvt Ltd (GIPL) seems to be saddled with indomitable challenges in the form of investigations by Directorate of Enforcement (ED), unsettled dues from Government of Kerala (GoK) and KSRTC, claims and counterclaims with National Highways Authority of India (NHAI), etc.
However, in the face of these adversities, GIPL that runs the controversy-plagued Paliakkara toll plaza has returned to profit, earning a net profit of Rs17crore for the financial year 2022-23 (FY23) compared with a net loss of Rs47 crore for the previous year.
GIPL has also witnessed 21 per cent growth in toll collection during the first five months of the current financial year to Rs80.6 crore against Rs66.7 crore for the comparable period in the previous year.
GIPL is a special purpose vehicle (SPV) formed for the four-laning of Thrissur-Angamali section of NH-47 (in Kerala) from km 270 to km 316, and improvement, operation and maintenance from km 316.70 to km 342.00 on a build, operate and transfer (BOT) toll basis.
The project was secured from NHAI by a consortium of Krishna Mohan Construction Ltd (KMC) and SREI with equity interest of 51 per cent and 49 per cent, respectively. However, later Bharat Road Network Ltd (BRNL) took over 76 per cent equity interest (49 from SREI and 25 per cent from KMC).
GIPL has been battered by several adverse developments in the past few years, the latest being a case filed by the Central Bureau of Investigation (CBI) and a subsequent investigation initiated by Directorate of Enforcement (ED) two months ago for allegedly violating certain terms of the Concession Agreement (CA).
GoK, KSRTC dues substantial
The Government of Kerala (GoK) had earlier issued an order for the issuance of free passes to certain category of local users and agreed to reimburse GIPL for the loss thus incurred on this behalf.
Further, Kerala State Road Transport Corporation (KSRTC) buses have not been paying toll from the commercial operations date (COD), despite the order from the Supreme Court (SC) of India in October 2015 to obtain passes for their vehicles.
Huge claims from NHAI
GIPL is required to pay negative grant worth Rs200 crore in five installments of Rs40 crore each from FY2017 to FY2021 to the NHAI.
A negative grant is a premium that a bidder (here GIPL) offers to the National Highways Authority of India (NHAI) to win a contract that they believe will be profitable. It's an upfront payment made by private players to the NHAI or government to get concession rights on project corridors
GIPL did not pay this amount (negative grant) and had requested the NHAI to adjust the negative grant installments against the pending dues from the GoK and KSRTC. GIPL had filed claims against NHAI.
The NHAI had also filed counterclaims for Rs1,075 crore (as on March 31, 2023) including penalties), and the matter is under arbitration.
If NHAI refuses to adjust its huge claims from GIPL against the latter’s dues from GoK and KSRTC, the consequences could be grave as the amount involved is huge and still growing. GIPL has also availed debt from Bharat Road Network Ltd (BRNL, Rs 5.8 crore of unsecured debentures as on March 31, 2023), and SREI Equipment Finance Ltd (SEFL, Rs170.5-crore unsecured loans as on March 31, 2023).
