GMR Infrato invest $375 million with its partner to develop Philippine airport

Written by fe Bureau | Mumbai | Updated: May 31 2014, 00:38am hrs
GMR Group, who along with Megawide bagged the project to develop and operate Philippine's Mactan-Cebu International Airport in April, will invest $ 375 million in the coming quarters along with its partner to construct a new terminal and upgrade the older terminal at the airport, officials of the company told analysts on Friday.

The infrastructure major also plans to enhance the non-aeronautical revenue from the airport, which is currently almost nil, by developing a 8 acre land parcel for commercial purpose.

We expect the non-aeronautical revenue to grow at 25-30% Compound Annual Growth Rate (CAGR) annually, once we take over the operations of the airport from October-November this year, said Madhu Terdal, Group Chief Financial Officer at GMR Group, to analysts at a conference call on Friday.

At present the the annual revenues from Mactan-Cebu International Airport stand at about $ 35 million, said Terdal. This is set to increase in the coming quarters with GMR further upgrading and making a new terminal.

An official from the Bangalore-based company had earlier told FE, under the condition of anonymity that it would make an equity investment of about $35 million to $40 million over the next three years to develop the airport.

In addition, GMR and its partner plans to double the passenger capacity to 14 million per year in the next three-four years, a GMR spokesperson had confirmed

At the conference call Terdal said that the company's net debt stood at Rs 37,788 crore at the end of the March quarter.

This comprised of debt of Rs 9,446 crore in the airport segment, Rs 5,004 in the road segment, Rs 21,971 crore in the power segment.

The company's debt to equity ratio stood at 3.50 during the March quarter compared to 3.97 during the December quarter on the back of the proceeds in tune to Rs 1,659 crore which it got from the sale of its stake in the Turkish Airport to Malaysian Airports Holdings BDH during the fourth quarter.

The infrastructure major on Friday posted a two-fold rise in its Profit After Tax (after minority interest) for the quarter ended March 31, which stood at Rs 1,170 crore against Rs 579 crore during the same quarter in FY'14.

GMR Infra shares closed flat at Rs 33.40 on Friday on the Bombay Stock Exchange.