New Delhi: Adani Airport Holdings Ltd (AAHL), a wholly-owned subsidiary of Adani Enterprises Ltd, has taken over the management control of Mumbai International Airport Limited (MIAL) from the GVK Group on Tuesday, the company said in a statement.
AAHL has received approvals from the Government of India, the City and Industrial Development Corporation (CIDCO) of Maharashtra, and the Government of Maharashtra to take over management control at the country’s second busiest airport.
“Our larger objective is to reinvent airports as ecosystems that drive local economic development and act as the nuclei around which we can catalyse aviation-linked businesses. These include metropolitan developments that span entertainment facilities, e-commerce and logistics capabilities, aviation dependent industries, smart city developments, and other innovative business concepts,” said Gautam Adani, Chairman of the Adani Group, in a statement.
“Our airport expansion strategy is intended to help converge our nation’s Tier 1 cities with the Tier 2 and Tier 3 cities in a hub and spoke model. This is fundamental to enabling a greater equalization of India’s urban–rural divide, as well as making international travel seamless and smooth,” he added.
AAHL became the country’s largest airport operator after picking up a controlling stake in the Mumbai International Airport Limited (MIAL), which operates the Mumbai airport, earlier this year.
The Chatrapati Shivaji Maharaj International Airport (CSMIA) in Mumbai is the second largest in the country, in terms of passenger traffic.
Adani Group has also won competitive bids to operate airports at cities like Jaipur, Ahmedabad, Guwahati, Lucknow, Mangalore and Thiruvananthapuram.
The Adani Group however plans to defer take over of airport assets at Jaipur, Guwahati and Trivandrum to December as these businesses look financially unfeasible to operate amidst the covid-19 pandemic and would lead to additional cost burdens for the conglomerate,
According to a March report from rating agency Icra Ltd, the airports sector is likely to incur a net loss of ₹5,400 crore in financial year 2021 because of a sharp decline in passenger traffic following the coronavirus outbreak. The report has also estimated a cash loss of ₹3,500 for the sector.
The airport sector is expected to bounce back to profitability in FY22, with the industry net profit expected to rise to ₹190 crore, said Icra.
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