Jaypee Infra: Market value of Yamuna e-way higher than liquidation value, says NBCC

NBCC, in a letter to the committee of creditors (CoC) of Jaypee Infratech (JIL) on Wednesday, said the fair market value (FMV) of Yamuna Expressway is higher than the liquidation value projected.

The state-run company emphasised assenting financial creditors (AFCs) can realise up to Rs 4,000 crore for the 90% stake in the e-way SPV being offered to them as part of the insolvency resolution process.

JIL’s CoC meet on Thursday (June 10) to deliberate on the revised resolution plans of NBCC and the consortium led by Suraksha Realty as well as decide on the voting process for acquisition of the bankrupt real estate developer.

Sources said the lender’s panel on Monday (June 7) had sought clarification from NBCC on the rationale behind its offer to AFCs and dissenting financial creditors (DFCs). The PSU replied that according to the interim resolution professional’s (IRP) letter last month, the liquidation value (LV) of Yamuna Expressway is Rs 3,458 crore.

“NBCC emphasised that the FMV of Yamuna Expressway is estimated to be higher based on Dun & Bradstreet’s June 2019 traffic study report. It also attributed the higher value to development of Jewar international airport, upcoming toy and film city and growing industrial and commercial activity in the surrounding areas. It is of the view that lenders can realise Rs 3,500-4,000 crore for their 90% stake in expressway,” one of the sources added.

The company pointed out that it will create a separate special purpose vehicle (SPV) for the expressway with settlement of operational liabilities upon approval of its bid, he said

NBCC has offered to transfer 90% equity of the Expressway SPV, including concession rights of Yamuna Expressway and land, to AFCs in its revised bid submitted on June 4. It also offered 1,903 acres of land to institutional financial creditors (IFCs), which includes parcels identified for enforcement of security interest of DFCs total admitted claim of IFCs is Rs 9,783 crore.

“NBCC said IRP’s May 17 letter puts LV of 1,903 acre at Rs 3,133 crore. However, land monetisation would fetch a higher value of about 40-50% than the LV, in the range of Rs 4,400-4,700 crore, over a period of time. This is due to the Jewar international airport, film city, toy city and various other commercial ventures. The values are based on NBCC’s assessment,” the source added.

This is the fourth round of the bidding process in the matter of JIL’s bankruptcy case. The company went into the insolvency process in August 2017 after the National Company Law Tribunal (NCLT) admitted an application by an IDBI Bank-led consortium.