In a recent announcement, L&T, the major stakeholder in Telangana’s Hyderabad Metro project, has revealed plans to sell its ownership after 2026.
The Telangana state government owns 10% of the metro project, while L&T owns the remaining 90% of it.
The Hyderabad Metro Rail is the world’s largest metro project under public-private partnership. It now spans three routes, covering 69.2 km.
Recently in an interview with Business Today TV, L&T’s president, whole-time director, and Chief Financial Officer (CFO), R Shankar Raman blamed poor ridership and divestment plans on the Telangana Congress government’s “Mahalakshmi Scheme” which offers free bus trips to women and has been a great hit.
Raman observed a noticeable shift in transport patterns, with women preferring free bus rides to metro rides and men preferring railway travel.
His criticism against the scheme, which is also in place in states like Tamil Nadu and Karnataka and has been promised by the opposition TDP in Andhra Pradesh, has sparked controversy.
The metro’s daily passenger count has dropped from its peak of 550,000 in November 2023 to 480,000 now. The metro’s financials have been a source of worry for the company, and it wants to monetize the asset after FY26 as part of its non-core business ambitions, Raman told Business Today TV in an interview.
The corporation intends to address concerns about declining ridership by managing the metro system for 65 years under concession.
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Raman’s statement highlights the complex interplay between government policies, public transit preferences, and corporate strategies that shape urban transportation.
In response to the changing situation, L&T obtained a soft loan of Rs. 3,000 crore from the Telangana government to help with financial difficulties and plan for future monetization options, including real estate assets tied to metro improvement.
L&T Hyderabad Metro Rail has a debt burden of Rs. 13,000 crore, in addition to the Rs. 2,000 crore loss suffered in recent years, and plans to reduce its debt to Rs. 8,000 crore.
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