NCC Infra and Soma Enterprises sell stake for Rs 750 crores

Infrastructure firms NCC Infrastructure Holdings (NCCIHL) and Soma Enterprise are selling their entire stake in Bangalore Elevated Tollway (BETL) for Rs 750 crore. The two infrastructure companies have entered into a pact with India Infrastructure Fund II, managed by IDFC Alternatives, to sell their stake. NCCIHL is a subsidiary of NCC Ltd.

Each of NCCIHL and Soma Enterprises holds 38 per cent equity share holding in BETL. The divestment entails their full exit from BETL including through sale of preference shares held and repayment of shareholder loans held by both NCCIHL and Soma in BETL. This development follows a recent government decision to allow infrastructure players to exit highway projects.

IDFC Alternatives is one of India's largest multi-asset class fund managers with assets under management of approximately USD 3.4 billion. Infrastructure Fund II is the successor to IDFC’s debut infrastructure fund and has an investible corpus of Rs 55 billion.

On the financial front, NCC Infra's total revenue from operations increased by 0.17 per cent to Rs 2396 crores in Q3FY16 from Rs 2653 crores in Q3FY15. The EBITDA stands at Rs 276 crores, an increase of 0.24 per cent from Rs 275 crores in Q3FY15. The net profit stands at Rs 36 crores, an increase of 58.63 per cent from from 22.6 crores in Q3FY15. The increase in net profit is on back of substantial decrease in interest expense by 13.86 per cent. From Rs 186 crores in Q3FY14 it became Rs 161 crores in Q3FY15.

For the FY15 the turnover and net worth contribution of BETL in the consolidated accounts of NCC stood at Rs 28.42 crores and Rs 40.93 crores respectively.

On valuation front the trailing twelve month P/E of company is at 18.22 compared to industry P/E of 21.09. The stock of NCC Infra is trading at Rs 66.55 an increase of 2.23 per cent from the previous close.