L&T, Gulermak, Afcons & ITD Lowest Bidders for B’lore Metro’s UG PH2

Four infrastructure firms – Larsen & Toubro, Gulermak, Afcons Infrastructure and Italian-Thai Development have emerged as the lowest bidder for constructing a package each on the 13.92 km Dairy Circle – Nagawara underground section of Bangalore Metro’s 21.415 km Line-4 (Reach 6) of the 72 km Phase 2 project after officials today opened the financial bids packets submitted to this build this section.

Civil construction bids for this underground section’s tunnels, stations, ramps and other allied infrastructure were invited in late-June 2017. Out of 16 firms which bought tender documents, only 4 bidders submitted bids in October of which Larsen & Toubro submitted bids for only package 2 & 3 – see other interesting notes here.

The bids placed were 67-75% higher than BMRCL’s estimate – see my thoughts at the bottom of this post.

Package 1 (R6-UG-P1) 3.67 km  – South Ramp to Vellara Road Station with 3 stations at Dairy Circle, MICO Industries, Langford Town

Firm Bid
Afcons Rs. 2223.54 cr
Gulermak Rs. 2311.34 cr
ITD Cem Rs. 2337.93 cr

BMRCL’s estimate: Rs. 1268.90 cr
Difference: Rs. 954.64 cr (75.23% higher)

Package 2 (R6-UG-P2) 3.62 km – Vellara Road Station to Cantonment Station with 3 stations at Vellara Road, MG Road, Shivaji Nagar

Firm Bid
Gulermak Rs. 2219.86 cr
Afcons Rs. 2311.11 cr
L&T Rs. 2333.71 cr
ITD Cem Rs. 2349.70 cr

BMRCL’s estimate: Rs. 1325.97 cr
Difference: Rs. 893.89 cr (67.41% higher)

Package 3 (R6-UG-P3) 3.32 km – Cantonment Station to Venkateshpura Station with 3 stations at Cantonment, Pottery Town, Tannery Road

Firm Bid
L&T Rs. 2237.58 cr
Gulermak Rs. 2341.32 cr
Afcons Rs. 2361.32 cr
ITD Cem Rs. 2373.35 cr

BMRCL’s estimate: Rs 1334.83 cr
Difference: Rs. 902.75 cr (67.63% higher)

Package 4 (R6-UG-P4) 3.31 km – Venkateshpura Station to North Ramp with 3 stations at Venkateshpura, Arabic College, Nagawara

Firm Bid
ITD Cem Rs. 1872.47 cr
Gulermak Rs. 1994.41 cr
Afcons Rs. 2010.95 cr

BMRCL’s estimate: Rs. 1117.86 cr
Difference: 754.61 cr (67.50% higher)

Summary of bids receieved (Green: lowest & Red: highest)

Here’s a general alignment of the line. The BMRCL in January decided to stick with their decision to place the Cantonment Station at Bamboo Bazaar (see location) instead of the original location which was closer to the railway station (as depicted below).

Underground section of Gottigere – Nagawara line – see exact alignment/location of the stations here

Combined totals for all 4 Packages
• Lowest bids: Rs. 8553.45 cr
• BMRCL’s estimates: Rs. 5047.56 cr
• Difference: 3505.89 cr (69.45% higher)

The lowest bid placed in each case was way higher than the BMRCL’s estimate, so either the BMRCL got their calculations wrong or the firms colluded together.

Now that the bids are opened, the BMRCL is staring at a repeat of Phase 1 in which the bids received for Package UG-1 (North Ramp – Majestic – Chickpet – KR Market – South Ramp) of the Green Line were higher than their estimates. The BMRCL subsequently broke it up into 2 packages, with the construction of the Majestic Interchange Station placed under a different package, and re-invited bids.

The BMRCL now has two options, both of which are time consuming –

  1. Reinvite tenders as-is or consolidate into 2 or 3 packages.
  2. Negotiate with the lowest bidders by minimizing the scope of the project (example – reducing number of cross passage tunnels, reducing number of TBMs required, reducing station length or number of  entrances). In Mumbai, the MMRCL successfully did that between October 2015 – July 2016 for 7 underground packages on the 33.5 km Line-3. Combined contract values were brought down by 7.45% (compared to the bids) which means the BMRCL has a very small wiggle room available to negotiate.

Both options add a minimum delay of 6 months. Needless to say, contracts for this section’s construction will be awarded only after one of the above options is exercised and successful.

Update – Thanks for the warm welcome, everyone! Glad to be back in action. 🙂

For more updates, check out the Bangalore section of The Metro Rail Guy!

– TMRG

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Global traveler who prefers mass rapid transit

40 Responses to "L&T, Gulermak, Afcons & ITD Lowest Bidders for B’lore Metro’s UG PH2"

  1. Vishal Kain says:

    Nice to see u back

    Reply
  2. Srinivas says:

    Welcome back TMRG.

    Just by looking at the bids we can easily tell that there is clear cut collusion between 4 companies. One package each at much higher prices.

    How does these prices compare to earlier sections in Bangalore or other cities where currently work going on.

    Reply
  3. Syed Khaja says:

    Hi, TMRG, Any update on phase 2A ORR metro???

    Reply
    • TMRG says:

      A couple of MoUs for funding the line’s construction are in the pipeline. Will share details when they get finalized.

      Reply
  4. Surya Prasad CA says:

    Still no signs information on exact station locations of the elevated section of this line. It’s like I have been waiting for it since ages 🙁 .

    Reply
  5. Pradeep says:

    I can see lots of working happening from Gottigere to Jedimara signal, Road widening along with Metro work. Not sure about station’s locations on elevated sections.

    Reply
    • Nitin says:

      At least at some places looking at the demolitions done we can predict the station location. For Hulimavu its just besides the Chaintania techno School after 2 houses where a decent amount of demolition has happened. Much deeper than the overall demolitions just for widening of the road. I would assume that deep demolitions can mean only 1 thing Metro Station !!!!

      Reply
      • Surya says:

        Station locations I will tell u….First Gottigere station will be in front of Mantri Residency….2nd one u guessed right infront of Chaitanya Techno school….3rd one infront of IIMB….4Th one infront of Vega City Mall….5th one Jaydeva junction….and 6th at Swagath road cross near Accenture…..

        Reply
        • Surya Prasad CA says:

          If so Vega city mall station and Jayadeva are too very near. If Gottigere station comes up near Mantri Residency it’s not Gottigere at all, it is Kalena Agrahara. Also the station distance between Hulimavu and this one will be near too.
          Looking at vehicle movement and population, one station should have been right exactly in Gottigere. Unfair!

          Reply
  6. Mayank says:

    Welcome back sir, happy as hell to see you. Please cover the news on the extension of vaishali metro and the indirapuram metro.

    Reply
  7. Pankaj kumar says:

    Hello sir .
    Welcome back on track………after looking at bids seriously it seems like bmrcl wants the project to be done one chillars that means then even the bidders will also try to save a lot such that some things is left with them …………..anyway sir nice to see you back

    Reply
  8. Alok pusti says:

    Welcome back TMRG ,

    Reply
  9. Ashok says:

    Welcome back. Was getting worried what had happened !!

    Reply
  10. Prithviraj says:

    Welcome back TMRG! This time I was starting to fear that you were gone for good! 😛

    Reply
    • TMRG says:

      I don’t have any plans to abandon this site. So next time I’m out (hopefully not as long as this), be assured that I’ll be back eventually 🙂

      Reply
      • flthere says:

        Please put a splash page next time that you are going to be offline for couple days/weeks to decrease the anxiety 🙂

        Reply
  11. Yash Mhadgut says:

    Good to see you back TMRG. Was really worried if you are okay or not or you were not interested in running this site anymore. Almost gave up hope but was delighted to see your post.

    Reply
  12. Ansh Jindal says:

    Welcome back!

    Reply
  13. Bharat Kheria says:

    Welcome Back.. though it looks like you still have not gained your old momentum back.

    Hope to see a lot from you soon !! If possible please provide a comprehensive update on Mumbai Metros

    P.S. If taking a long leave of absence in the future; could you please post an approx. period of black out in advance

    Reply
    • TMRG says:

      Things were beyond my control, but yes – I’ll make sure to post a comment if I’m out for a long time.

      I’ll be clearing out a backlog of old updates for the next couple days. Just posted a bunch of old ones from December.

      Reply
  14. Rohan says:

    My thoughts:

    1. Only 4 bidders. You are exposing yourself to collution if you only have 4 companies bidding for a project. Maybe BMRC should have structured the project in such a way so as to attract more companies. Greater the number of companies, lesser is the probability of collusion.

    2. Does BMRC even know how to estimate costs. Perhaps BMRC underestimated the cost inputs. They should assess their own capabilities and see if they need some external help. DMRC’s consultancy arm can certainly bridge BMRC’s capability gap.

    Reply
    • Rishav Mahapatra says:

      Now this will cause a delay of at least 6 months

      Reply
    • sham says:

      As already stated by TMRG himself, 4-5 bidders for UG sections is normal & nothing out of the ordinary. And what exactly is “structuring the project in such a way so as to attract more companies” ?

      I don’t think BMRC did anything wrong by estimating low – they may have done it in an attempt to lower bid prices. This happened in Mumbai too & ultimately, costs could be reduced by only a small extent.

      And DMRC’s so-called “capability” is well known – like goofing up airport PPP, shutdown of airport line for “repairs” soon after opening, providing no connectivity for airport line with other lines (though crossing them), complete goof ups in DPRs & cost estimations for BMRC’s ph1 & ph2 (which had to be redone entirely), huge cost & time extensions in Delhi’s ph-3 etc.. Better they stick to Delhi & try to improve their performance there instead of meddling & spoiling things elsewhere too!

      Reply
  15. Rohan says:

    Looked at the bidding data again.

    Package 1. Afcons has the lowest bid. Contract worth 2,223 crores.

    Package 2: Gulermak has the lowest bid. Contract worth 2,219 crores

    Package 3: L&T has the lowest bid. Contract worth 2,237 crores.

    Package 4: ITD Chem has the lowest bid. Contract worth 1,872 crores.

    So all the 4 companies won the contracts. Just a coincidence, perhaps not. A serious investigation is required.

    Reply
    • sham says:

      A serious investigation was required when Mumbai handed out seven tunneling contracts that were far higher than the estimates that were prepared by DMRC & MMRC had to hike up estimates to be within 25% of bids to avoid further delays.
      So, DMRC should have been investigated as to why their estimates were so inaccurate !!

      Reply
      • Rohan says:

        Do you work for BMRC. LOL. Why are you defending them. Clearly, something is seriously wrong here. Cost estimates vary by such a huge margin (>60%). Four packages offered, four companies bid, and all four of them won.

        Reply
        • Sham says:

          This is obviously a straight forward case of under estimation of costing by BMRC (probably to influence & get lower bids).

          But the Mumbai handouts by DMRC seem to have been something sinister. DMRC’s estimates were lower by 40% & in one case by 77% for Mumbai’s UG line. And they had hiked up estimates & still handed out work orders despite all this. So, something was far more seriously wrong there than here.

          Reply
  16. Victor says:

    When vl the UG Works start i can see that nothing is started till now only they have given notices to building where the UG Station come.

    Reply
    • TMRG says:

      Depends on the outcome of the option BMRCL pursues. At this point of time, proper construction work for the TBM launch shafts are expected to be begin only in 2019 and actual tunneling in 2020.

      Reply
  17. USOZ says:

    Happy New Year! Nice to see progress being made!

    Reply
  18. Shreeharsha Phene says:

    Mr TMRG,

    Welcome back!

    S.V.Phene

    Reply
  19. VSK says:

    Congrats. You’ve been mentioned in Deccan Herald

    “While the BMRCL did not release the bidding details, a report on the blog ‘The Metro Rail Guy’ claimed the lowest bid for the four packages was 69.45% higher than the BMRCL’s estimates. While Metro officials had estimated the cost at Rs 5,047.56 crore, the lowest bids were Rs 8,553.45 crore, the report stated.”

    http://www.deccanherald.com/content/658884/4-firms-bid-phase-2.html

    Reply
  20. Sukhman says:

    Welcome back ! Now update posts of Delhi metro

    Reply
  21. Akshay says:

    Points to Note:
    1) Price contractor has quoted includes GST while client estimates exclude GST. So remove 18% (as GST was 18% when bid was submitted now reduced to 12%)
    2) TBMS requirement is more, existing TBMs mist contractor own can not be deployed due to Bangalore Data
    3) Client estimates has not been revised for last 3 years
    4) Equipment requirement in contract is more compared to other UG contracts

    Reply
    • Akshay says:

      Point 2) correction :Its Bangalore Strata

      Reply
    • flthere says:

      4) BRMCL must have taken that into their estimates as well, right?

      I hope whatever decision BRMCL makes, they better make it quickly. The more they delay, the higher the next bids will come in coz of rising costs and better estimate capability of the bidders.

      Reply
  22. Surya says:

    Welcome back, TMRG 😀

    Happy to have you here and read your updates all over again.

    Cheers

    Reply

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