GMR to spend ~500 crore on Hyderabad airport expansion

GMR Hyderabad International Airport Ltd (GHIAL) will utilise $75 million (~490 crore) of the $350 million (~2,280 crore) it has raised in the international bond market on capital expenditure. The rest will be used to refinance existing debt.

GMR Airports president Sidharath Kapur elaborated on the fund utilisation plan of the subsidiary company. The exact capex requirement wasn’t detailed, pending regulatory approvals for its proposed airport expansion plan. Allocation of $75 million is a first move.

Earlier this year, India Ratings and Research estimated about ~2,500 crore might needed to expand the annual capacity to 20 million passengers from the present 12 million, a level the actual traffic had surpassed by a huge margin last year itself.

Last year, GHIAL chief executive S G K Kishore had said the proposed capacity expansion would be over two to three years.

In an interview to CNBC-TV18, Kapur also clarified that GMR would look at selling only 12 per cent stake in GHIAL if and when it decided on equity dilution; the company would like to retain a minimum 51 per cent stake. GMR holds 63 per cent equity. Airports Authority of India has 13 per cent, as does the Telangana government. Malaysia Airports Holdings Berhad has the other 11 per cent.

“We will think of monitising the equity at a right time. As of now there's no definitive plan and nor we are discussing with anyone in this regard,” Kapur said.

The overall trajectory of debt with the airport subsidiaries was pointing downward, he added. The Delhi and Hyderabad airports together carry about ~7,500 crore of debt. Of this, debt in GHIAL’s account books is about ~ 2,000 crore, to be mostly restructured with the bond issue's proceeds.

The new Hyderabad International Airport opened around nine years earlier, after being built by the GMR-led concessionaire at an investment of close to ~2,500 crore.