AAI to raise $300 million via ECB next fiscal

By: |
March 14, 2020 5:45 AM

The proposed investment is for building new airports, upgrading of unused airstrip and doubling the current passenger handling capacity of 345 million to 700 million per annum.

According to him, of the present 110 airports in the country, the AAI operates over 90. According to him, of the present 110 airports in the country, the AAI operates over 90.

As part of its capex plan to invest Rs 25,000 crore over the next five years, the Airports Authority of India (AAI) is looking to raise $300 million in first tranche through external commercial borrowings (ECBs) by next fiscal. The fundraising plan received the board’s approval last month. The proposed investment is for building new airports, upgrading of unused airstrip and doubling the current passenger handling capacity of 345 million to 700 million per annum.

Speaking to media on the sidelines of aviation exhibition Wings India 2020, AAI chairman Arvind Singh said the airports operator would be spending Rs 5,000 crore on capex for the next five years beginning this year. “We are thinking of going for ECB at lower rates to fund our plans. Also, we get funds from the central government under the Udan scheme. The Centre has allotted Rs 4,500 crore to build airports under the Udan scheme. We will be going for ECBs next financial year,” Singh said.

According to him, of the present 110 airports in the country, the AAI operates over 90. “A large part of the outlay of Rs 25,000 crore would come from AAI’s external borrowing, primarily through fundraising via bonds. Our balance sheet is very healthy, with AAA ratings and we got the board approval for the same last month,” he said.

“The total outlay for 2020-21 is likely to be more than Rs 5,000 crore, and the AAI plans to fund about 40% of its outlay through debt. Of the rest, about `500 crore will come from the government for developing smaller airports for regional flights and internal accruals,’’ he said.

“The rapid expansion in India’s airport and air navigation structure will definitely fuel the huge business and tourism opportunities in our great country. Indian aviation will be the epicentre of the growth trajectory and will present a whole range of opportunities,” he added.

“We have made 48 airports operational in the last three years. So, to meet all these requirements, we have a very huge capex plan. On an average, we are spending Rs 3,000-4,000 crore a year. From this year, we are stepping it up to Rs 5,000 crore per annum. We should be able to reach upto 700 or 750 million passengers by 2030,” he said. There are 21 approved greenfield airport projects in the country and five of them have been completed, he added.

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