GMR now eyes non-aero business

Hyderabad, March 29 | Updated: Mar 30 2006, 06:31am hrs
With work on the upcoming Rs 1,760-crore new international airport in full swing at Shamshabad spread across 5,400 acres and about 20 kms off the city GMR Hyderabad International Airport Ltd (GHIAL) is now focusing on developing its non-aeronautical business plans.

Non-aero business, estimates GHIALs chief operating officer T Srinagesh, will initially account for about 50% of the total revenues, but would eventually go up to as much as 75%. Towards that, GHIAL a joint venture company promoted by GMR Group (63%), Malaysia Airports Holding Berhad (11%), Andhra Pradesh government (13%) and Airports Authority of India (13%) will finalise its cargo contracts, caterers, maintenance and repair overhaul (MRO), aircraft fuelling and retail concessionaires in the current year.

Besides, the group also plans to set up budget hotels and an airport-based special economic zone to lure manufacturers of high-value products like computer chips, electronics, and gems and jewellery.

GHIAL has already shortlisted three global cargo operators out of the eight, which had shown interest, and would take a final decision by next month. The company plans to set up a joint venture with the operator, who would manage the cargo terminal with a capacity of one-lakh tonne per year.

For setting up a fuel farm, it has shortlisted eight companies including Indian oil, BPCL and Reliance Industries. A final decision would be taken by August 2006, Mr Srinagesh said.

GMR is also roping in MROs for the airport. However, contrary to expectations, the company is not in talks with aircraft manufacturers like Boeing and Airbus, but with five global MROs including Lufthansa Technik of Germany, besides Zurich-based SR Technical and Singapores ST Aviation. The selection is likely to be completed within six months.

Who's In Talks With GHIAL
MROs: Lufthansa Technik, SR Technica, ST Aviation
Aviation Fuel: All oil PSUs and Reliance Industries
Retail: Alfa Retail, G-Heinamann, Arienta and Aldeza
To develop its retail business, the company is in discussions with eight retailers for setting up duty-free shops and food and beverages stores, Mr Srinagesh said.

Hitherto, the company has awarded two major contracts one for building passenger terminal building (PBT), runway and Air traffic control tower and the other for airside and landside works contract worth Rs 615 crore to China State Construction Engineering (Hong Kong) and Rs 495 crore to Larsen & Toubro respectively.