The greenfield airport at Bhogapuram, Andhra Pradesh is being developed by GMR Airports
FinTech BizNews Service
Mumbai, December 21, 2023: GMR Airports Limited (GAL), a subsidiary of GMR
Airports Infrastructure Limited, and NIIF (National Investment and Infrastructure
Fund) entered into binding agreements for NIIF to invest up to INR 6.75 billion in
GMR Visakhapatnam International Airport Limited (GVIAL), a special purpose
vehicle to develop and operate the Bhogapuram International Airport. This
investment is part of the financial partnership announced on 7 th December 2022
between the parties, in relation to investment by NIIF in the equity capital of three
airport projects of GMR Airports Limited. 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. 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. 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. GVIAL shall be an important engine of Andhra Pradesh’s
economic development and growth over the medium to long term.
GBS Raju, Business Chairman – Airports, GMR Group, said, “It is a proud
moment for GMR Group to develop the greenfield Bhogapuram International Airport
in the State of Andhra Pradesh. We are confident that we will replicate the success
of our Hyderabad Airport and the new world class airport will act as the catalyst for
the socio-economic growth of the city and the State at large. 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.”
