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Project Finance Yamuna Expressway Project Analysis

Submitted by Devi M (27013) Prabu R (27096) Sudharsan S (27118)

INTRODUCTION:

The 165 km Yamuna expressway connects delhi and agra with the primary purpose of reducing the travel time .It is constructed by jaypee group to provide a fast moving corridor in the eastern side of Yamuna to relieve the already congested NH-2 . Objectives of Yamuna expressway: y y y To connect the main townships / commercial centres on the eastern side of Yamuna. To ensure development of adjoining area. The Yamuna Expressway along with the existing NH-2 and NH-91 and interconnectivity between all three of them will form a good network of roads which in turn, open up a vast area of all-round development in the following areas:  Upcoming huge urban conglomerates in NOIDA and Greater Noida with their own potential will have easy accessibility towards Aligarh, Mathura and Agra.  Safe, shorter travel time and the accessibility in the region will accelerate land development along the Yamuna Expressway in a planned manner for commercial, industrial, institutional amusement and residential purposes.

JAYPEE GROUP: JIL is an Indian infrastructure development company engaged in the development of the Yamuna Expressway and related real estate projects. JIL, which is part of the Jaypee Group, was incorporated on April 5, 2007 as a special purpose company to implement the Concession.

JIL holds the Concession from the YEA (Yamuna Expressway Authority) to develop, operate and maintain the Yamuna Expressway in the state of Uttar Pradesh, connecting Noida and Agra. The Concession also provides for the right to develop 25 million square metres (~ 6,175 acres) of land along the Yamuna Expressway at 5 locations for residential, commercial, amusement, industrial and institutional purposes.

PROJECT FUNDING: Yamuna expressway project cost:

Cost Description Land acquisition Cost of construction Preliminary and Pre operative expenses Contingencies Interest during construction Total Project Cost

Amount (in mn) 26,190 53,000 2400 2300 13,502.90 97,392.90

The means of financing for funding the Yamuna expressway project is as follows

Means of Finance Net Proceeds Other means of finance Debt Equity contribution by the promoter and others Contribution from real estate Development Sub Total Total

Amount (in mn) 15,000 60,000 12500 9892.9 82,392.90 97382.9

ISSUES: Change of government in 2003 during the start of the project Land acquisition issues:  The government acquired land from them at prices as low as Rs 450-850 for a sqm but sold those later to private developers at Rs 4,500-5 ,500 per sqm.  The developers are now selling the same land at Rs 15,000 - 17,000 per sq yard.

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CURRENT STATUS:

Jaypee group has postponed the opening of its mega project, the 165-km Yamuna Expressway, which originally was set to be opened on Jan 15, Uttar Pradesh Chief Minister Mayawati's birthday.

Opening is delayed due to assembly elections and yet to be completed two inter-changes, land-scaping, plantation, fresh guards installation and some finishing work.

FUTURE DEVELOPMENTS:

The area all along the Yamuna Expressway alignment shall become prone to encroachment and haphazard growth.

Taj International Airport and Aviation Hub and SDZs are proposed along the alignment adjacent to Greater Noida