Airports Authority of India (AAI) plans to kick off the third part of airport privatization after the overall elections, starting with offloading its remaining 13% stake in Bangalore Worldwide Airport Ltd (BIAL) this yr, the officers stated on situation of anonymity.
“The plan is to be carried out after the brand new authorities takes over in June,” one of many officers stated. “Together with Bengaluru, AAI will look to promote its stake in Hyderabad airport as properly.”
Presently, monetary funding firm Fairfax (Fairfax India Holdings Corp) owns round 64% of BIAL, whereas Siemens Mission Ventures GmbH holds 10%. AAI and Karnataka State Industrial and Infrastructure Growth Corp. maintain 13% every. The airport is operated by BIAL.
GMR Hyderabad Worldwide Airport Ltd operates the Hyderabad airport during which GMR group has 74% shareholding. The Telangana authorities and AAI personal 13% every.
Queries despatched to AAI, Bengaluru airport and Hyderabad airport remained unanswered until press time.
As a part of airport privatization 3.0, AAI plans to ask bids for operation, administration and improvement of 13 different airports in public-private-partnership mode, the officers added.
Amongst these are six airports—Bhubaneswar, Trichy, Indore, Raipur, Amritsar and Varanasi—which are among the many prime 20 airports operated by AAI by way of passenger visitors.
These six shall be clubbed with seven loss-making small airports—Kushinagar (in Uttar Pradesh), Gaya (Bihar), Hubballi (Karnataka), Aurangabad (Maharashtra), Jabalpur (Madhya Pradesh), Tirupati (Andhra Pradesh) and Kangra (Himachal Pradesh).
The plan is to focus on infrastructure progress throughout each main and minor airports, one of many officers stated.
“Beneath step one, AAI is prone to float a request for proposal and invite bids for leasing 13 airports for a interval of fifty years,” the official added. “The plans for divestment of stake and public-private partnerships have been within the pipeline for a while now, however we count on the implementation this yr.”
“Provided that Indian airports have large progress potential for non-aero revenues when in comparison with their world counterparts, and given the excessive progress in passengers and spend per passenger, we count on the expansion to stay robust,” stated Vinay Kumar G., vice chairman & sector head – company rankings, ICRA Ltd.
Plans to denationalise about 25 airports and promote AAI’s stake within the airport corporations in Delhi, Mumbai, Hyderabad and Bengaluru are a part of the Nationwide Monetisation Plan (NMP) introduced in September 2021, during which the aviation sector was anticipated to contribute 3.5%.
Beneath the NMP, the federal government had recognized 25 AAI-owned airports and 4 private-sector owned metro airports to unlock a worth of ₹21,000 crore throughout 2022-2025.
This consists of round ₹10,000 crore from the sale of AAI’s stakes within the 4 main metro airports and a further ₹11,000 crore from leasing 25 AAI-operated airports to non-public entities.
The primary part of airport privatization, which started within the 2000s, included offloading stakes in Delhi and Mumbai airports, and the event of greenfield airports in Bengaluru and Hyderabad.
The second part, which occurred in 2019, concerned the privatization of six AAI airports in cities like Ahmedabad, Jaipur, Trivandrum, Mangalore, Lucknow, and Guwahati. The Adani Group had emerged as the best bidder by way of per passenger charge for the six airports. These have been leased to Adani Group for operation, administration and improvement for a interval of fifty years.
For the fiscal yr 2022-23, AAI acquired ₹3,020.55 crore in lease income from the three way partnership airports in Delhi and Mumbai, boosting its total revenues. Moreover, the six PPP airports leased to Adani Group generated ₹683.86 crore by means of annual concession and upfront charges, a big leap from ₹329.59 crore the earlier yr. AAI’s whole income for FY23 was ₹12,172 crore, practically doubling from ₹6,841 crore in FY22.
Beneath the public-partnership settlement, the operators of Delhi and Mumbai airport pay 45.99% and 38.7% of the gross income, respectively, to AAI. For Bengaluru and Hyderabad airports, the mannequin entails fee of 4% income as annual concession charge. For the six airports that had been leased to Adani in 2019, AAI prices per passenger charge.
The passenger visitors at 5 main non-public airports (Delhi, Mumbai, Bangalore, Hyderabad, Cochin) has surpassed the pre-Covid degree in FY2024. Nevertheless, the visitors at main AAI-operated airports (Chennai and Kolkata) recovered to solely about 90% of pre-Covid ranges throughout final fiscal (FY2024), Icra stated.
“Traditionally, by way of passenger visitors progress in addition to cargo progress, the non-public airports have carried out higher than AAI-operated airports,” Kumar of Icra stated. “Additional, the non-public participation in airports has resulted in higher facilities and infrastructure, leading to improved passenger expertise and non-aero revenues for the operators.”