India’s major  infra companies have collectively paid out more than $1 billion towards finance and interest costs during the first half of the current fiscal, resulting in huge dents in the margins.

Jaypee  one of the bigger players in the market paid Rs 6,794 cr towards finance costs during the April-September, as L&T, Reliance Infra, HCC, GMR, Lanco, IVRCL, per their respective financial reports in the H1.

The increase is observed as 31 pc compared to the same period last fiscal when they paid Rs 5,375 cr.

According to experts if the trend would continue in their second half of the financial year and the costs may even go high if Reserve Bank of India decides to increase rates further.

The overall economic slowdown is leading to high debt and interest burden on the property sector claimed experts.

Debt burden is a consistent woo for the infra firms in India as most players taken up more projects than they can handle in a span of time period.

It may take considerable time for these debt ridden firms to come out of the bad situation.

Since 2007, private firms have pumped $235 billion into India infra market, but the results are somewhat disappointing. Some public-listed infra companies have experience severe stock-price dip in recent times.

In this process the interest burden is hampering the operative performance. In some cases the debt is five times more than the market capitalisation of the company.