Reliance Infra will pay off debts by March 2017: Lalit Jalan, Reliance Infrastructure

Reliance Infra is looking forward to raise money by selling various assets in power, road and cement businesses.

Lalit Jalan, Chief Executive Officer, Reliance Infra, spoke on the current debt position of the company. In an interaction with ET Now, Jalan said that the company aimed to be a debt-free entity by March 2017 on the back of the proceeds generated from the asset sale.

Ongoing Portfolio Rejig Mode

Reliance Infra is looking forward to raise money by selling various assets in power, road and cement businesses. When Jalan was asked to throw some light on this initiative of the company, he said that it's a transformation phase for the company as it's trying to become a leading defense player in the coming years.

It intends to have a strong presence in EPC and power in the future. Reliance Infra has also announced the acquisition of Pipavav Defence, which is yet to be closed.

Monetization of Road Assets

Reliance Infra owns about 11 road projects whose enterprise value is approx Rs. 9,000 crore.Jalan said that the company in talk with several bidders who can offer a valuation better than the Rs. 9,000 crore EV. The company will take a final call on all the road projects by the end of the current financial year.

Cement Business of Reliance Infra

Jalan said that the company has shortlisted 7 out of a total of 15 participants. The overall operating capacity of Reliance Infra goes up to 5.6 million tonne. Apart from this, the company has brownfield assets in Madhya Pradesh and Maharashtra. These can be converted into fully operating assets within 24 months. Most of the bids received for cement business are in the range of Rs. 5,000 crore and the final call will be made by the end of December 2015.

Jalan concluded the discussion on the note that Reliance Infra would like to explore railways in two areas: EPC and Railway Modernization. Final draft about this initiative is likely to be ready very soon.

Stock View

Reliance Infrastructure Ltd is currently trading at Rs. 441.5, up by Rs. 18.3 or 4.32% from its previous closing of Rs. 423.2 on the BSE.

The scrip opened at Rs. 427 and has touched a high and low of Rs. 443.2 and Rs. 424.4 respectively. So far 2089066(NSE+BSE) shares were traded on the counter. The current market cap of the company is Rs. 11129.74 crore.

The BSE group 'A' stock of face value Rs. 10 has touched a 52 week high of Rs. 531.6 on 15-Dec-2014 and a 52 week low of Rs. 282.2 on 25-Aug-2015. Last one week high and low of the scrip stood at Rs. 439.35 and Rs. 414.65 respectively.

The promoters holding in the company stood at 48.53 % while Institutions and Non-Institutions held 35.6 % and 13.09 % respectively.

The stock is currently trading below its 200 DMA