GMR Airports Ltd., the main competitor to Adani Group’s airports operator, is planning to spend as much as Rs 19,400 crore ($2 billion) to expand its New Delhi and Hyderabad facilities, a sign of bullish expectations for India’s aviation market over the coming decade.
The investments, spread over the next five to seven years, are aimed at boosting capacity and modernizing infrastructure to keep pace with rapidly rising passenger volumes, Saurabh Chawla, company’s executive director for finance and strategy said in an interview.
The plans come as demand is surging in the world’s third-largest domestic aviation market, trailing only the US and China. India’s flier traffic is projected to grow six-fold to around 1.1 billion passengers over the next 14 years, while its commercial airline fleet is seen increasing from 400 planes as of 2014 to more than 2,350 aircraft by 2040, according to government estimates.
The company is earmarking about Rs 13,800 crore for Rajiv Gandhi International Airport in the southern industrial hub of Hyderabad and as much as Rs 5,600 crore for the New Delhi airport, Chawla said. The investments will be funded by a mix of debt and equity by the respective airport ventures and not directly tied to GMR Airports, which is the holding company.
