NBCC (India) and Rail Land Development Authority signs MoU for redevelopment of 10 Railway Stations

NBCC inks MoU with South Delhi Municipal Corp. to build Rs.525 Crore office building. Expect 30 more station redevelopment projects to come: NBCC

NEW DELHI: NBCC (India) and Rail Development Authority, a statutory authority under the Ministry of Railways have signed a Memorandum of Understanding for re-development of 10 nos. of Railway stations i.e. Tirupati, Pudducherry, Eranakulam, Nellore, Madgaon, Thane, Lucknow, Kota, Gomati Nagar (Lucknow) and Sarai Rohilla (Delhi). The re-development of railway station would be integrated with Smart City features.

Shri Venkaiah Naidu, Minister of Urban Development, Minister of Housing & Poverty Alleviation and Minister of Information & Broadcasting said that the people of the country are looking for new facilities and new changes, they expect transformations to be done expeditiously in all spheres of life. It is a very good idea to develop smart stations along with the smart cities. He said that the PSUs of his ministry will undertake stations redevelopment in a professional way.

Shri Suresh Prabhakar Prabhu, Minister of Railways said that Indian Railways has taken up this ambitious program of station redevelopment in a big way and have adopted multi pronged strategy to accomplish this mammoth task. He said we have chosen PPP model and are roping in varied agencies to execute the project namely Railways’ own PSUs, other Central Government PSUs, foreign countries through Government to Government cooperation and state governments. He said that once the stations are redeveloped, the passengers will get facilities of world standard. He said that NBCC has now been given 10 stations in first phase for redevelopment and more stations would be given to them in subsequent phases.

RLDA and NBCC shall form a SPV in the form of a JV Company to execute the station redevelopment project. The JV shall redevelop the stations on a self-financing model. NBCC shall use its expertise in preparing DPR of the Project and business model. RLDA shall extend necessary help to NBCC in arranging all requisite data pertaining to the stations and get the vacant land entrusted from Ministry of Railway as per approved master plan of the station. The JV of NBCC and RLDA shall also enter into city support agreement with the respective Smart City Authorities and local bodies to obtain support relating to development of approach infrastructure and favorable Development Control Norms for the project.

Background

Earlier in October 2016, the MoU was entered into between Ministry of Railways and Ministry of Urban Development for mutual cooperation between the two Ministries for integrated planning of redevelopment of railway stations in the cities included in the ‘SMART Cities’ and AMRUT schemes. The proposal was to plan the redevelopment of stations in partnership with the smart city SPVs and Urban Local Bodies so that the planning and redevelopment of the station and the city areas near the station is done in an integrated manner. This MoU between Ministry of Railways and Ministry of Urban Development provided for formation of a JV company between NBCC and RLDA to take up the station redevelopment projects as NBCC has very wide and varied business experience in and expertise in the field of construction & real estate development and RLDA has expertise in monetization of Railway land by way of long term leasing of land.

NBCC is in focus after they signed Memorandum of Understanding (MoU) with ministry of railways for redevelopment of ten railway stations.

NBCC (India) rose 2.62% to Rs 207.80 at 11:35 IST on BSE after the company signed a MoU with Rail Development Authority for re-development of 10 railway stations with Smart City features. The announcement was made after market hours on Friday, 30 June 2017.

Meanwhile, the S&P BSE Sensex was up 287.39 points, or 0.93% to 31,209. On the BSE, 1.35 lakh shares were traded in the counter so far, compared with average daily volumes of 1.92 lakh shares in the past one quarter. The stock had hit a high of Rs 209.35 and a low of Rs 203.50 so far during the day. The stock hit a record high of Rs 213.70 on 22 June 2017. The stock hit a 52-week low of Rs 126 on 1 July 2016. The stock had outperformed the market over the past one month till 30 June 2017, rising 4.92% compared with the Sensex’s 0.76% fall. The scrip had also outperformed the market over the past one quarter advancing 17.66% as against the Sensex’s 4.3% rise. The scrip had also outperformed the market over the past one year surging 57.31% as against the Sensex’s 14.53% rise.

The large-cap company has equity capital of Rs 180 crore. Face value per share is Rs 2.

The project would be developed on self sustainable finance model through commercial exploitation of vacant railways land, NBCC (India) said. Commercial built up space having Business Centre, Offices, F&B courts, Restaurants, Hotels, Retails, IT/Ites & air space over tracks shall be leased out to generate funds for development of stations, the company said.

Meanwhile in a separate announcement made during market hours today, 3 July 2017, NBCC (India) said that the company has also signed a Memorandum of Understanding (MoU) with South Delhi Municipal Corporation (SDMC), Delhi for planning, designing and construction of office building / SDMC headquarters near Pragati Maidan, New Delhi amounting to Rs 525 crore (approximately). In a regulatory filing, NBCC said it has “signed a memorandum of understanding (MoU) with South Delhi Municipal Corporation, Government of NCT, Delhi for planning, designing and construction of office building/ SDMC headquarter near Pragati Maidan at IP Estate amounting to Rs 525 crore.”

On a consolidated basis, NBCC (India)’s net profit rose 39.03% to Rs 173.97 crore on 4.94% increase in net sales to Rs 2351.78 crore in Q4 March 2017 over Q4 March 2016.

NBCC (India), a blue-chip Government of India (GoI) Navratna enterprise under the Ministry of Urban Development, is present in three segments of operations including project management consultancy (PMC), real estate development and EPC contracting. The GoI held 75% stake in the firm (as per shareholding pattern as on 31 March 2017).

Meanwhile, in an interview, Anoop Kumar Mittal, CMD of NBCC spoke about the MoU and latest happenings in the company. “We have not worked out the actual cost and the quantum of this project but expect project cost for each station to average at Rs 500 crore”, said Mittal.

He expects all ten stations to be ready in three years time. Mittal also expect 30 more station redevelopment projects to come to NBCC. On South Delhi Municipal Corporation project front, he expects the project revenue to reflect from Q3 of FY18.

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