B'lore Metro to raise Rs 300 cr via bond issue

The corporation is executing the 42.3-km Phase I of the metro project in Bangalore at an estimated cost of Rs 11,609 cr

The Bangalore Metro Rail Corporation Limited's (BMRCL) is planning to raise Rs 300 crore through a private placement route. It plans to launch a secured non-convertible and taxable bond issue sometime in July. The money will be used to fund its ongoing development of the first phase.

The corporation is executing the 42.3-km Phase 1 of the metro project in Bangalore at an estimated cost of Rs 11,609 crore. The BMRCL had completed and has commissioned the first reach spanning 7 km between Baiyappanahalli and M G Road in October 2011. It is now undertaking a trial run on the third reach spanning 5.3 km between Peenya and Yashwantpur.

The Japan International Co-operation Agency (JICA) and France-based Agence Française de Developpement (AFD) have extended loans with sovereign guarantees to it.

Earlier in March this year, the AFD, a public development finance institution, signed a project financing agreement with the BMRCL for providing a Euro 110 million (about Rs 787 crore) finance.

In April 2011, the Asian Development Bank (ADB) extended up to $250 million (Rs 1,372 crore), while Hudco sanctioned a loan of Rs 700 crore to the Namma Metro project in October 2011.

Other Indian financial institutions, such as the Housing and Urban Development Corporation (Hudco) and Indian Infrastructure and Finance Company Ltd (IIFCL) are also contributing to the funding of the project.

The first phase of the Bangalore Metro project consists of two lines, totalling 42.3 km and 40 stations. The lines will criss-cross the city, from north to south and east to west. All along the line at the 40 stations, passengers will use a modern ticketing system with user-friendly signage and passenger information system.

By end-2014, the existing system will transport 1.2 million passengers per day and, by 2021, 1.9 million passengers per day. The Phase-I will be completed by December 2014.

Both the Centre and Karnataka government have taken a 15 per cent each equity stake in BMRCL.

Phase II of the project, awaiting final approval of the Centre, will cover 72 km and the cost is estimated at Rs 26,405 crore. It will consist of extensions of the east-west and north-south lines of Phase-I and the construction of two new lines. The state government has already approved the project. The share of the state government is expected to be Rs 8,969 crore.