GMR Airports Infrastructure shares in focus as NIIF invests Rs 675 crore in Andhra Pradesh airport

Shares of GMR Airports Infrastructure Ltd will be in focus on Friday morning after a subsidiary GMR Airports and NIIF (National Investment and Infrastructure Fund) entered into binding agreements for the latter to invest up to Rs 675 crore in GMR Visakhapatnam International Airport (GVIAL), a special purpose vehicle to develop and operate the Bhogapuram International Airport.

GMR Airports Infrastructure said the investment is part of the financial partnership announced on December 2022 between the two parties, in relation to investment by NIIF in the equity capital of three airport projects of GMR Airports.

"This marks NIIF’s second airport investment, after its investment in GMR Goa International

Airport Limited, which operates Manohar International Airport in Goa, was completed in April 2023. GVIAL, in 2020, was awarded the concession to develop and operate the greenfield Bhogapuram International Airport (BIA) to the north of Visakhapatnam under a 40-year Design-Build-Finance-Operate-and-Transfer model," GMR Airports Infrastructure told stock exchanges.

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The GMR Airports Infrastructure stock is up 28 per cent in the last one month and 80 per cent in 2023 so far. The company reported a narrowing of losses in the September quarter.

BIA, a part of the National Infrastructure Pipeline, is poised to become the largest airport in the state of Andhra Pradesh with a phase I capacity of up to 6 million passengers per annum and with an ultimate capacity of up to 40 million passengers per annum, as per GMR Airports Infrastructure's BSE filing.

"The transaction envisages a primary investment by NIIF in the form of Compulsorily Convertible Debentures (CCDs) to be issued by GVIAL. The transaction is subject to customary completion of conditions precedent and necessary approvals. BIA will provide vital infrastructure to deliver a world-class passenger experience in Andhra Pradesh while significantly enhancing air travel potential in the Visakhapatnam region. The project is well positioned to boost connectivity and transportation infrastructure in northern Andhra Pradesh and also resonates with national priorities of strengthening air travel penetration and connectivity, especially to Tier 2 and Tier 3 cities," GMR Airports Infrastructure said.

Business Chairman – Airports GBS Raju said, “The new Bhogapuram airport and airport city will help in the transformation of Visakhapatnam and will place it on the global map as the most preferred investment destination. Our growing partnership with NIIF is a further testament of GMR’s credibility as an Airport Infrastructure developer and the future of the Aviation industry in the country.”

Vinod Giri, Managing Partner – Master Fund, National Investment and Infrastructure Fund Limited, said, “NIIF believes that Bhogapuram International Airport will strengthen aviation infrastructure in Andhra Pradesh, playing a pivotal role in the region’s economic progress in the coming years. NIIF’s Master Fund is India’s largest infrastructure fund with a robust and well-diversified portfolio across transportation, energy and digital infrastructure. NIIF’s

investment in GVIAL represents the Fund’s second airport project, underscoring our commitment to participate in the implementation of Government of India’s ambitious National Infrastructure Pipeline.”

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