Telangana Govt Takes Over Metro Rail Phase-1, L&T To Divest Its Complete Stake

Haydarabad: The Telagnana government took over the Metro Railway Phase-1 operations and made it a completely state-controlled asset. L&T said he was ready to remove his shares from L&T Metro Rail Hyderabad Limited (Ltmrhl). During the negotiations, CMD L&T referred to the additional concession agreement signed on 22.07.2022, where 2,100 CRORE was caused by an interest -free loan agreed from the state government. After detailed discussions and with the aim of accelerating the approval of the Indian Government, it was accepted that the state government would take over the 1 Metro Railway Project by accepting the current debt as approximately 13,000 CRORE. In addition, approximately 2,000 Crore will provide one -time settlement for the state government L & T for the investment of equity in LTMRHL.

In 2014, Haydarabad, who ranked second in the country in terms of Metro Rail’s network length, has now moved to the 9th position of the country. In order to meet the increasing demand for public transport in Haydarabad and the surrounding areas, the TELANGANA government presented suggestions for the sanction of 8 new metro line as part of the phase 2A and 2D expansion covering an additional network of approximately 163 km.

The Indian government held more than one meeting to review these proposals. One of the main issues brought to the agenda by the Indian government was the need for operational integration between the existing phase 1 subway developed under a special privilege and the recommended stage 2 expansion under a state institution. In order to address this, the Indian government emphasized the necessity of a definite agreement to ensure uninterrupted operations and appropriate income/cost sharing. L&T Metro’s participation in Phase 2 can be seen as a joint venture partner with Goi and Gotg.

In this context, in order to solve the existing deadlines since November 2024, Prime Minister A. Revanth Redy held a meeting on Thursday to meet with senior L & T officers and senior officials with the CMD of L & T Group SN Subrahmanyan. The Prime Minister underlined that the state government preferred to participate in the 2nd stage expansion as a stock partner to build on the current partnership. However, CMD L&T explained that the company has come out of the ownership and business of transportation concession assets and therefore will not be in a position to participate as a self -equity partner in the upcoming expansion.

The Prime Minister also emphasized the importance of concluding a definite agreement for the operational integration of Phase 1 and Phase 2 corridors. As it insists on the Indian government, such an agreement will provide clarity about uninterrupted train operations and include income and cost -sharing mechanisms and thus ensuring further processing of stage 2. CMD L&T, while accepting the importance of integration, in two stages of trouble -free train operations and income and cost sharing issues expressed concerns and said they would not be able to sign the final agreement under the current conditions.

As a part of the debate and the Indian government, CMD L&T reiterated an alternative proposal to the state government to disposal of the CMD L&T, 1st stage metro. Detailed negotiations were held on the financial aspects and asset valuation of the FAZ 1 project. CMD L&T suggested that the state government could take over the full debt of LTMRHL, and in addition, it could pay about 5,900 crore for the equity value.

The terms and methods of the inheritance shall be solved by mutual discussions in a way that protects the public interest by adapting to all legal and legal provisions and providing early approval for expansion.

Chief Secretary K. Ramakrishna Rao; The Consultant of the Telangana Government (Urban Transportation) NVS Reddy; PRL. Finance Secretary Sandeep Kumar Sultanya; Secretary, MA & UD K. Ilambarithi; MD, Hmrl Sarfaraz Ahmad; PRL. CM Secretary V. Seshadri; and CM K. Manicka Raj Secretary, attended the meeting by the government. CMD, L&T Group Advisor DK Sen and LTMRHL MD & CEO KVB Reddy, attended the meeting with L&T Group CMD.