GQG Partners Deepens India Infrastructure Bet With Rs 1,672 Crore Stake In GMR Airports, GMR Airports Forecasts Record Passenger Traffic And Strategic Debt Refinancing Plans

GQG Partners has increased its investment in India’s infrastructure sector by acquiring a 4.7% stake in GMR Airports Infrastructure, with a total value of Rs 1,672 crore in an open market transaction on Friday. 

The purchase, led by GQG Partners Emerging Markets Fund and Goldman Sachs GQG Partners International Opportunities Fund, involved buying 92,636,787 and 19,02,45,637 shares, respectively, at a price of Rs 59.09 per share—a 4% discount compared to the previous closing price.

Apart from GMR Airports, GQG Partners has a diversified portfolio, including investments in various companies within the Adani Group, such as Adani Enterprises, which operates the Mumbai international airport. 

The acquisition significantly boosted GMR Group’s stock, driving it to its highest levels in over 14 years, reaching an intraday high of Rs 70.40, the highest since June 2009. The stock closed nearly 12% higher at Rs 68.89 on the BSE, with trading volumes exceeding 862 million shares, well above the three-month average.

Year-to-date, GMR Airports shares have delivered impressive returns of over 73%, and over a three-year period, the stock has witnessed a remarkable rally of more than 190%. 

As of September-end, foreign institutional investors held a 28% stake in the company, while mutual funds accounted for approximately 1.3% of the total shareholding.

Interestingly, despite reporting a consolidated net loss of Rs 190 crore for the September quarter, compared to Rs 197 crore in the previous year, GMR Airports Infrastructure demonstrated a 25% increase in revenue to Rs 1,607 crore during the same period. 

GMR Airports Forecasts Record Passenger Traffic and Strategic Debt Refinancing Plans

GMR Group, a global infrastructure development leader, continues to make strides in creating mega projects across the globe. With a robust portfolio covering airports, major energy utilities, highways, and urban infrastructure, the group boasts a net asset base of nearly US $6 billion, solidifying its position as one of India’s largest infrastructure development companies. 

Notable airports under its purview include Delhi International Airport, Hyderabad International Airport in India, and Mactan Cebu International Airport in The Philippines.

A recent comprehensive interview provides a glimpse into GMR Airports’ strategic vision, financial planning, and growth expectations in the dynamic aviation sector.

The CFO of GMR Airports Infrastructure Ltd, a listed subsidiary of GMR Enterprises Pvt Ltd, recently shared insights into the company’s optimistic outlook for the current quarter. 

Anticipating a significant business growth and record passenger traffic, the CFO underlined the historical strength of the aviation industry in quarters one and three – the third quarter, buoyed by holiday seasons, is expected to witness substantial traffic growth.

The CFO further revealed ambitious targets, aiming to touch 70 million passengers this year at Delhi airport, with a corresponding 17-18% growth projection at Hyderabad airport. 

Meanwhile, addressing the current debt situation, plans for strategic debt refinancing were disclosed, involving three tranches, with a total debt level estimated at ₹4,700 crore.

The CFO emphasised the unique challenges across different airports in response to potential tariff increases due to domestic investments; while Delhi airport boasts one of the lowest tariffs globally, expectations for a minimum yield per passenger stand at ₹350, a marginal increase from the current ₹150. 

The CFO also highlighted tariff adjustments at Hyderabad airport and revealed plans for Goa airport’s tariff revision, which will be effective January 2024. 

The Last Bit, GMR Group’s global infrastructure development, marked by its extensive portfolio and a net asset base of nearly US $6 billion, positions it as a key player in India’s infrastructure sector. 

The latest insights from the CFO of GMR Airports Infrastructure Ltd reveal an optimistic outlook, anticipating record passenger traffic and significant business growth in the current quarter; with strategic plans for debt refinancing and a debt level projection of ₹4,700 crore, the company is poised for financial resilience.

The CFO’s nuanced perspective on tariff increases highlights the unique challenges faced by different airports within the GMR Group – while Delhi airport maintains one of the lowest tariffs globally, expectations of a minimum yield per passenger at ₹350 reflect a balanced approach to financial sustainability. 

The ongoing investments in domestic projects and tariff adjustments at airports like Hyderabad and upcoming plans for Goa indicate the company’s commitment to adaptability and growth.