Viraj Desai , ET Bureau | May 29, 2012, 09.48AM IST
NEW DELHI: The average return on equity on road projects awarded in 2010-11 is likely to be 6%-8% lower than those contracted before 2009, according to a study by ratings and research agency CRISIL.
The study estimates that toll road projects awarded on build-operate-transfer basis before 2009 could earn developers an average equity return of 22%.
The study estimates that toll road projects awarded on build-operate-transfer basis before 2009 could earn developers an average equity return of 22%.
In comparison, projects awarded in 2010-11 may see a drop in returns to about 14% due to high premiums offered by developers to the government. Generally, road developers target a return of 16%-18%.
The study covered 23 BOT road projects, which account for a fourth of the toll roads.
The study covered 23 BOT road projects, which account for a fourth of the toll roads.
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