CM for immediate assignment of metro rail valuation, refinancing and future debt structuring to SBI CAPS

Chief Minister A. Revanth Reddy has requested the Central Government to assign the process of valuation, refinancing and future debt-raising requirements for Hyderabad Metro Rail Phase I takeover and expansion in Phase II to SBI Capital Markets Limited (SBI CAPS) immediately so that the integrated exercise can commence without delay.

Early appointment of the agency is essential as the valuation of phase-I, the refinancing of its debt and the financial structuring of phase-II are closely interlinked and need to be examined together, the Chief Minister said in separate letters addressed to Union Ministers Manoharlal Khattar and G. Kishan Reddy.

The Chief Minister recalled his meeting with the Union Housing Minister Manoharlal Khattar in the presence of Mr. Kishan Reddy and Railway Minister Ashwini Vaishnaw on June 24 wherein it was agreed that SBI CAPS would be entrusted with valuation and financial examination of Hyderabad Metro Rail phase-I facilitating its takeover by the Telangana Government.

However, despite considerable time that had elapsed since the meeting, the SBI CAPS had not yet been entrusted with the assignment and the terms of reference had not been finalised and communicated to the Telangana Government. “The prolonged process for takeover of phase-I is creating operational uncertainty and day-to-day challenges for the project,” he said.

At the same time, the delay was also affecting the sanction of phase-II detailed project reports and tying up for suitable funding arrangements. This was in turn postponing the project implementation and was likely to increase the cost of phase-II due to avoidable time overrun and escalation.

The Chief Minister accordingly requested the Union Minister to take steps to entrust the assignment to SBI CAPS at the earliest and ensure the terms of reference were communicated to the Telangana Government. “This will enable the decisions taken during the meeting to be implemented expeditiously, bring the phase-I takeover process to its logical conclusion and allow the phase-II expansion proceed without further delay,” he said.