In yet another tollway default, an SPV owned by GMR Infra has had delays in servicing debt, and has been downgraded to D (default) status by CARE. GMR Hyderabad Vijaywada Expressway Pvt Ltd (GHVEPL) has an incredible excuse for their troubles : GHVEPL is located in the state of Telangana and Andhra Pradesh. Post bi-furcation of the state, both the state governments have formulated the sand mining policy, banning movement of minor minerals (especially sand) across the state border. Further, states have imposed levy of new taxes like octroi and entry tax on movement of goods across the state border. Due to such changes in the policies, the commercial vehicle traffic on account of movement of sand has drastically reduced from the projected traffic. Commercial vehicles contribute significant amount of revenues. This has severely impacted the revenues and cash flow of the company resulting in slight delay in payments. So now it’s like “Oh we can’t pay because you won’t allow sand to be moved”, so we’re going to default.… (Read On…)
[via Capital Mind » Capital Mind]
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