Ladies and gentlemen, good day, and welcome to GMR Airports Limited's conference call to discuss Q1 FY 2023 results. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. We have with us today Mr. Saurabh Chawla, Executive Director, Finance and Strategy. Before we begin, I would like to state that some of the statements made in today's discussion may be forward-looking in nature and may involve risks and uncertainties. Also, recording or transcribing of this call without prior permission of the management is strictly prohibited. I now hand the conference over to Mr. Saurabh Chawla for opening remarks.
Thank you, and over to you, sir.
Thank you, good afternoon, ladies and gentlemen. I also have my other colleagues on the call, G.R.K. Babu, who is the Sector CFO of the airport business. Now, of course, it's become a pure airport vertical, but he handles the minutiae details of the airport business. I also have Ashish Jain, who is the IR head, and then Nitin, who heads our strategic finance, who's joined us recently. Rajesh Arora is also there. On the call, from Mumbai, we have Suresh Bagrodia, who's the CFO of operations, and Ashish Jain, who heads strategy. All my colleagues are here to answer any of your queries. First, thank you for joining our first quarter fiscal 2023 earnings call.
As you can see, various countries are facing lots of challenges emanating from high inflation, commodity price shocks, diminishing value of currencies, and of course, monetary tightening that's happening world over. However, India, of course, remains an outlier, a bright spot in this current global scenario. Most economic activity indicators in India remain robust, despite the global headwinds, and despite the monetary tightening at home. For instance, services PMI has now grown to 59.8 in June. IIP growth rate for May 2022 is at about 19.6%. Manufacturing PMI is holding steady between 53-55 since January 2022.
Coming to our performance of GMR Airports for Q1 FY 2023, GMR Infra's net revenue increased by 24% year-on-year to INR 1,030-odd crores, while EBITDA increased by about 21% year-on-year to about INR 428 crores in Q1 FY 2023, mainly driven by traffic improvements in our operational airports. The net loss after tax has also reduced from about INR 180-odd crores in Q1 FY 2022 to about INR 113 crores in Q1 of the current fiscal year. Here I would like to highlight a few key points in our business. We made significant progress in our CapEx programs of Delhi, Hyderabad and Goa.
Delhi has achieved about 68%, Hyderabad about 75%, and Goa Airport has achieved about 85% completion as of June 30, 2022. As you are aware, Goa Airport is targeted to be inaugurated in August 2022, while Delhi and Hyderabad are targeted for completion in September 2023 and December 2022 respectively. In Goa, we have already filed the multi-year tariff proposal for the first control period starting from April 1, 2023 to March 31, 2028, with inclusion of partial period of September 1, 2022 to March 31, 2023. In Crete Airport, about 13.2% financial progress has been achieved, with completion of 90% of earthworks in the airport area and 32% earthworks in external access roads as of June 30. We are on track to achieve the completion target as stipulated.
On the Medan Airport, the Angkasa Pura Aviasi, APA, the joint venture company of GMR Airports and Indonesian state-owned airport operator, which is Angkasa Pura II, or AP2 as it's more popularly known, formally took over the operations of Medan Airport beginning July. On the passenger traffic, Delhi Airport and Hyderabad Airport have exhibited continued recovery of international traffic, which is currently standing at about 79% and 87% of pre-COVID levels respectively as of July 17, 2022. As, post removal of restrictions on scheduled flights, various international carriers have resumed their operations and added capacity to various Indian destinations. Domestic traffic at Delhi Airport and Hyderabad Airport have recently been impacted by seasonality and also to a certain extent by high airfares, which have resulted in traffic being at about 88 through 87% respectively to the pre-COVID levels. However, the long-term growth story remains intact.
In our Medan Airport, traffic recovery is encouraging as domestic traffic recovered up to 94% of pre-COVID levels and international traffic recovering steeply. Our overall traffic recovery is above 80% in Mactan Airport. In our international airport, Cebu, it continues to be in a recovery phase. Its domestic daily pax is now nearing 60% of the pre-COVID level, while international traffic is still lagging behind at 10% of quarter one, and that's mainly because the international traffic into Cebu is mostly from East Asia, which is primarily China, Koreas and Japan. In our Delhi Airport as an interim arrangement, we and Airports Authority of India have entered into a settlement agreement on the payment of monthly rental fee with effect from April 2022 prospectively.
The results that you see is after the payment of the monthly annuity fee for the last three-odd months during the quarter. In Delhi Airport, we have successfully completed the issuance of five-year non-convertible debenture amounting to about INR 1,000 crores. The proceeds will be utilized partly to finance the phase three expansion plan. In our Hyderabad Airport, we have received a letter of confirmation from Ministry of Civil Aviation, extending the term of concession agreement for a further period of 30 years, that is from March 2038 to March 2068. On airport land development in Hyderabad Airport, lease agreement has been executed with Schneider Electric for a lease of build-to-suit facility of about 0.38 million sq ft in two phases on 18 acres of land.
In Delhi Airport, we have recently or yesterday actually awarded the contract to the Chalet Hotels, the owner, developer, and asset manager of hotels, for developing a hotel at terminal three. The terminal hotel will be about 350-400 rooms and positioned in the five-star deluxe space. Development of terminal hotel at T3 will bring hospitality to travelers at the gates of international terminal. It will provide significant benefit to transit passengers, both domestic and international. In Nagpur Airport, the Supreme Court of India has upheld the judgment of Nagpur Bench of Bombay High Court that had previously quashed and set aside the letter issued by MIHAN India Limited, annulling the bidding process for Nagpur Airport. Accordingly, the authorities are expected to execute the concession agreement at the earliest at Nagpur Airport with GMR.
Going forward, traffic recovery will be mainly driven by lifting of curbs in airline capacity, addition of routes and capacity opening up with the opening up of East Asia, especially China and Japan. As per industry experts, airline fleet is expected to go up by 2.5x over the next five to seven years. New airlines such as Akasa is now getting ready to launch its operations in India, and Jet Airways is not far behind relaunching under a new owner. I believe that Akasa's first flight is expected in next week or 10 days' time. Existing airlines are also adding capacity and flying to new destinations. On the ESG front, sustainability has always remained a key element of GMR's corporate ethos and strategy. GMR-led airports across the nations are making consistent efforts to maintain the ecology and support sustainable development.
Our endeavor is to ensure operations are carbon neutral, and accordingly, we constantly monitor our activities carefully to further reduce emissions. A major milestone was achieved during this fiscal year, where Delhi Airport now has started to operate with 100% of its energy requirements being met from renewable sources. The presentation with all financial numbers are already available with you. If not, it can be downloaded from our IR section on our website. We are available to respond to your questions on this call and offline post the call. Now I would like to open the forum where my colleagues from the corporate and businesses can answer your questions. Thank you so much.
Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We have our first question from the line of Abhiram Iyer from Deutsche Bank. Please go ahead.
Hello, sir. Hope you can hear me well. Congratulations on a strong set of numbers in a challenging quarter. My first question was on CapEx expenditure over the next, you know, next three quarters of the fiscal as well as into the next fiscal. Could you just give out individually what those would be for Delhi Airport and GMR Hyderabad Airport? With and without, you know, any proceeds from the lease facility as well.
In case of the Delhi Airport, this current financial year, we are expected to spend about INR 3,300 crores.
Okay.
We have already spent about INR 600 crore so far. In case of the Hyderabad, we will be spending about INR 2,000 crore this financial year with that entire expansion will be completed.
The INR 2,000 crore will be till December 2023. That's our targeted date for Hyderabad, right?
Yeah, December 2022 is the target for Hyderabad Airport, but maybe it may take one or two months more, but by March 2023, everything will be done.
Got it, sir. This INR 3,300 that you mentioned for Delhi, this is before we take into account any proceeds from the lease facility?
Some amount of lease facility also will be used in that. As of today, with about INR 500-600 crores of lease facility we expect to use.
Got it, sir. The second question was on the tribunal case with regards to the Delhi airport. If I may, what's the current status, sir? When is the next hearing? Just one quick question. I know we have said that it's around INR 1,300 crore of payment that needs to be that we have sort of mentioned, and we have protested around INR 400 crore of payments already made. May I know what the opposite party, AAI is claiming or is bringing to the tribunal?
No. Our always stand was that as per the concession agreement in the OMDA, we are entitled in case of the force majeure. We are entitled to excuse from the performance of our obligations. That has already been, I mean, at the Delhi High Court level, since they have agreed upon, they found the merit in our argument, they have given a stay on payment of the annual fee. For the 2021 and 2021, 2022 together, we have not paid is about INR 13 billion. It's about INR 1,300 crores. However, from April 1, 2022 onwards, we have started making the payment of annual fee. It is only the issue is now pending only for the two years, INR 1,300 crores. The arbitration tribunal, all the documentation, everything has been completed, everything has been filed before them.
The dates have already been provided by the tribunal. In the month of October, they will be doing the cross-examination of the main businesses. After that, arguments and the judgment is expected by end of December. This is as per estimation.
Got it, sir. The INR 1,300 crore, this is the disputed amount, at most, right, sir? I know obviously if it goes in our favor, then this may be waived. We do have the right of force majeure, so this will. Is this the actual amount that is claimed by AAI or are they putting any penalties or additional interest or any other charges?
No, in case of the force majeure, as it is, the interest and penalties are not applicable.
Okay.
Number one. Number two, the company has not been paying it because of the High Court stay, that is the second ground. So far, AAI has not put any claim. They were only asking for the MAF payment as of today.
Got it, sir. Thank you very much.
Thank you. Ladies and gentlemen, you may please press star and one to ask a question. We have our next question from the line of Mohit Kumar from DAM Capital. Please go ahead.
Yeah, good afternoon, sir, and good to see good recovery here for traffic. My first question is, by end of this quarter and next year, we can see the Goa and the Hyderabad Airport new expansion adding to our revenues. Is the right assumption?
Correct. That is the right assumption. By next year, they will add to our revenues.
Goa and Hyderabad will.
Consolidate. In a consolidated basis, yes.
Understood, sir. Secondly, what is your outlook on airport land monetization, especially for Delhi Airport? Where are you in terms of land anticipation of 2.16 million sq ft at Delhi Airport for the two developments?
INR 2.78 million has already been taken over by the existing owner, winner of the bid. He has already. That's called Bharti Realty. They have already paid the money in the last year, September. The next INR 2.12 million, INR 1.3 million, they are going to take over by March 2023, and we are expecting the payment by April 2023.
The land has been identified. You don't expect any hurdle, right, to buy land at this point in time?
We don't. No. Land is already identified. It is already available, in case of the, hospitality districts next to it. There are two land parcels have already been identified and the infrastructure needs to be being developed. So there should not be any challenge. As a matter of fact, the work has already begun on that on 2.78. It is already with Bharti Realty, and they've begun the work also on it. So it's not that something which is, speculative, in any nature.
What is the outlook for the rest of the, let's say, 24 months for further monetization?
At this stage, we are not looking at any further monetization beyond what has already been contracted. In the last bid, it was a bid which was 5 + 5. As you know, in real estate, absorption levels have to be taken care of before further monetizations. We are not contemplating any monetization of further land beyond this 5.5 in the near future. Subsequent to that, we will see what happens. Even in that, now mostly our strategy is going to veer towards our self-development rather than monetization of the land.
The right of the ROFR for the next INR 5 million is still available to them.
Mm-hmm.
Lastly, is any cash losses expected in FY 2023 and how do you intend to fund it? Does it mean that corporate loan will be tapped in this fiscal?
Which one are you referring to? Sorry.
Can you repeat the question, please? No, my question is any cash losses expected in FY 2023? If yes, how do you intend to fund it? Does it mean the corporate loan, which is INR 19 billion at this point of time, will you tap by the end of this fiscal?
Just one second, Mohit. Yeah. I mean, the cash losses which are there are very minute as of now, as far as Q1 is concerned, and I think by the end of this fiscal year, this will also get mitigated. There's enough liquidity available within the group to manage any of these liquidity mismatches that may be there from a losses perspective.
Mm-hmm. Sir, if I ask some more questions on this end. Are there any specific policy enablers you are looking which will improve our non-aero revenues in the medium term?
No. Why so not clear at all? Can you
My question, is there any specific policy enablers which you are looking at which can improve our non-aero revenues, especially on the duty-free side?
No, we are not looking for any specific policy initiatives. Businesses on the non-aero side are quite robust. In our strategic plan over the next few years, we want to consolidate the non-aero businesses in various entities and manage at the Holdco level. That is the way we are going to proceed forward because as we keep adding number of airports in our family, we believe that if we can create consumer businesses out of that, then we can change the nature of our business just from mainly an infrastructure company to a more of a consumer-driven company. That's a strategy that we will articulate. We have articulated in the past, and as we go forward, we will implement it.
That's a three-year journey as we go forward. From a government perspective, we are not looking for any specific policy initiatives which may help the non-aero side of the business.
Understood, sir. Thank you. I'll leave it. Thank you.
Thank you. Ladies and gentlemen, to ask a question, please press star and one on your phone now. We have our next question from the line of Rushabh Sharedalal from Equirus PMS. Please go ahead.
Yeah. Hi, sir. Thanks for the opportunity. Am I audible?
Yes, you are audible, Rushabh.
You know, the first question will be on the DIAL Airport. Our presentation on page 13 mentions that the maximum capacity at DIAL which we can handle is 190 million. That's like a 12 crore kind of a number annually. Now, if I do the rough math of it, considering that there will be 130-140 people on a particular aircraft, my number comes to roughly managing 90 max aircrafts per annum, which is roughly almost 100 aircrafts per hour. Considering the fact that we presently have three runways at the airport and the 4th runway is crossing the 3rd runway.
How will we able to manage such a kind of number, given the fact that, you know, even the best airports in the world manage roughly 40 aircraft air traffic management per hour. If you can just help me get a sense of those 119 million that we want to manage. That's been my first question.
Let me answer the first question. I think your little facts are a little wrong. We have four parallel runways. One runway is slightly elongated, but it is fully operational. From an efficiency perspective, it does not put any drawback on the ATM at the airport itself. I don't think your math will work out if you were to take into cognizance that there are four operational runways that will be available, and they can be switched. With the cross taxiway, we'll be able to handle many more aircraft, both from a takeoff and movement within the airport perspective.
Another thing is you have taken an average of 134 passengers, but in case of wide-body aircraft, which we are going to employ, we are going to allow more, they can carry up to 250-300 people average. Yeah. Number one. Number two on our airside capacity, which we are now building up, can take 2,000 movements per day. That is the capacity we are building even today itself. We are talking about a 119 million, which is going to take up to 7-8 years. By that time, a lot of technology will also change, and with the existing capacity available, we do not foresee any challenge.
Okay. Basically just wanted to understand that you said that, you know, these larger aircrafts. Let's say if there are 100 aircraft that we are landing, how many of those 100 would be larger and how many of those would be normal aircraft?
No, no.
If you can give just a rough ballpark number?
No, no, Rushabh, I would request you, why don't you come to Delhi? Okay? You come and meet with our technical team, and you see what is happening both on the technology side and what process improvements are happening other than the physical infrastructure that is coming up. You'll be able to get a much better comfort. On an average, there are 20% wide-body aircraft right now.
Okay.
Right now. That is expected to go up because of international travel going up. Delhi is an international hub for India. Hence, our focus is yes, it's a wide body for all international flights, most international flights, whereas narrow bod-
Cargo.
Cargo also. Narrow-body for the domestic or regional flights, if I may say so.
Right. Okay. Just a small question on.
From a math perspective, you should assume about 30-odd% are wide-bodied as we go forward, and the capacity being about 250-300 seats per aircraft.
All right.
Currently all the airlines are moving to A321, and we've got the bigger aircraft even domestic also, which can carry up to 220 people.
Okay. Just wanted to know your views on the upcoming Jewar Airport. How are we, you know, because the phase one of the Jewar Airport, we expect it to commence by 2024, with roughly managing 1.2-1.5 crore passengers, and going ahead it'll be some 7-8 crore passengers. How many passengers or air traffic do you feel that will shift from DIAL to Jewar? Or if not, then how are we actually anticipating the capacities going ahead?
If you were to assume the same math that you're assuming for Jewar, then we can very easily handle not even 119 million passengers, but much, much more. Coming back to your specific question, yes, Jewar is going to go live sometime in 2024.
No, sir, 20-
2024 it'll get complete. 2025 it goes live.
Sure, no.
It really does not pose too much of competition for us because the location of Jewar is a little distant from the economic centers of Delhi and Gurgaon. Delhi Airport is actually a city airport now. It's right in the middle of Delhi and Gurgaon, which are the true economic engines of the National Capital Region. We don't foresee much competition. The second aspect is even as the airport starts operations and starts to grow, it will be primarily more low-cost airlines that would have a look at it, serving passengers from the Western UP agricultural belt or industrial belt of Moradabad, Aligarh, and Agra.
The high-yield paying passengers, if I may say so, will be all catered out of Delhi. Most of the international flights will get catered out of Delhi because that's where, you know, the passengers prefer. Both from a geographical location attribute perspective and also the economic underlying economic activity perspective, Jewar has still a long way to go before it can pose any competition for Delhi Airport. Yes, in 10 years, as the traffic is growing and air travel will continue to grow, Jewar will be a very successful airport at that particular point of time. Nothing to be worried about, at least in the medium term for us.
Right. Just a small question, if I can squeeze in. You know, we have shared some amount of revenue with Airports Authority of India starting first April 2022. If you can just quantify the number that we have shared this quarter and the sustainable number that we'll be sharing every quarter going ahead. Some ballpark figure, if you can.
The first quarter we have paid INR 400 crore as revenue share to Airports Authority of India by DIAL. Going forward, since first quarter we achieved about INR 15.3 million, 16 million if you state, more or less we'll be sharing the same amount every quarter.
That'll be INR 400 crore every quarter. Did I get the number part correctly?
That is what we said that INR 400 crore this quarter we paid, and we are expecting the traffic will be the same for the next three quarters. Yes, it is about INR 400 crore.
Sure. Sure, sir. I have a few more questions. I'll get back in the queue again.
Yeah.
Thanks a lot.
Thank you. We have our next question from the line of Anshuman Ashit from ICICI Securities. Please go ahead.
Thank you, sir, for the opportunity, and congratulations on a good set of numbers as well as taking over Medan Airport. Sir, on Medan, sir, so correct me if I'm wrong, so this will also add to FY 2024 full year revenues, apart from Goa and Hyderabad. Is that understanding correct?
Yeah, that is an equity method because in Medan Airport we are holding 49% stake. The 51% is held by AP II. They will be consolidating with accounting on equity method.
Okay. Sir, if you could give us some data on the FY 2022 performance of Medan Airport, maybe the EBITDA and the traffic which was there in FY 2022. Will it be possible?
We will share it offline with you. Amit will share it with you separately. I don't have it readily available here with me right now.
Okay. Moving on to the Goa Airport. You mentioned that there will be an interim arrangement because the petition which has been filed is starting from April 2023. What is the traffic assumption that you would have made for that, for this interim arrangement? Then will the tariffs also be the same as you mentioned in your petition?
No. As far as the tariffs are concerned in case of the Goa, we have filed an application for a control period April 2023 to April 2027, March 2027. That is. In the interim period of this five months to six months, we have offered ad hoc UDF, which the regulator in principle agreed and they are examining it. We are filing necessary papers with them.
How do you see the traffic shifting from the existing airport to this airport? How do you see the growth in store for this new airport which is coming to Goa?
There is a good momentum, and the airlines are actually asking for the slots. We are expecting the winter schedule will be starting by them. As you know, there are five hours of the block period in case of the existing doubling. We are expecting that this five hours will be the crucial for the airlines and also that we are expecting good amount of the traffic. As of today, airlines are already requesting for the slots, which our team is already working on.
Are we planning to monetize the land bank over there as well?
Yeah. The work is going on in the direction also.
Okay. Sir, coming on to the revenue share in Delhi. In the presentation, an amount of INR 817 crore is mentioned. You just mentioned that the revenue share was INR 400 crore for Q1. What does this INR 817 crore were comprised of?
No, INR 400 crores only we are paying in the first quarter.
In the presentation, if I look at the slide number 35. Oh, sorry. Yeah. That was a mistake on my end. This is INR 400 crore. Okay. A final question on Cebu Airport. The profit over there, in fact, the loss over there has been consistent despite the growth in traffic and revenues. When do you see this turning around?
In the first quarter of this calendar year, because Cebu follows the calendar year, was a bit below the traffic, but April onwards it started improving a lot. This, the second quarter, June quarter, they'll be much better placed. We are expecting Cebu this financial year they should be able to do more than 60% of the pre-COVID level traffic.
Okay. Probably by next financial year, we may see some profits over there. Is that-
Profits we cannot comment, but at least it will be able to meet all its obligations.
Okay. One final question. There was supposed to be a testing of the earnouts of INR 1,060 crores by FY 2022 end. Could you tell us about whether that has happened and where do we stand?
The earnouts will be. You see, they were supposed to be tested after the audited accounts. Now that the audited accounts are over with, we are in conversation with ADP, and it will be settled over the next few months itself. That's not an issue at all.
Cool. Thank you, sir. Thank you so much.
Thank you. Ladies and gentlemen, to ask a question, please press star and one on your phone now. We have our next question from the line of Aditya Mongia from Kotak Securities. Please go ahead.
Yeah. Good afternoon, everyone, and thanks for the opportunity. The first question that I had was on the capacity front. Now you did mention 109 million as Delhi capacity. I wanted to get a sense that is this today constrained more by the air side capacity, and can this number become larger over time?
Yes. As of today, it was constrained by the air side. Now we are building the capacity on the air side, which is we take care of a full 100 million, 190 million.
Okay. Can the numbers be meaningfully different than 109 over time? I'm just getting a sense from you because I think this is, for an asset like Delhi, an extremely important parameter for us to monitor.
The 109 is the capacity we are building. You can always stretch it because today the technology and going forward the technology is going to change and the aircraft mix can change and anything. Because of that 109 million, basically we have estimated based on 2,200 movements per day. The highest movements. There should not be any challenge as far as the handling of 190 million. Without sweat actually, the tech can go up to about 140-odd million. That is normally what we have seen in our airports. We've experienced that in Delhi also. We've experienced that in Hyderabad also. We take into account all that as we go forward.
Yes, physical rated capacity will be 120, with the potential to go up to about 140. Sure. That's helpful. The second question that I have was this notion that, obviously Delhi will become an international airport hub at some point of time. You did allude to, let's say, a 400 keys hotel coming about at this moment. As you see through this transition, which are the other things that you need to do for Delhi to start becoming attractive as a hub over time? Well, I think the best is that if we can offer wide-body direct flights to North America and to also Australasia, if I may say so Australia and the Far East.
These are two aspects which will catapult Delhi into a hub similar to, let's say, a hub in Dubai. What does Dubai offer? It offers direct flights all across the world. It has a great duty-free and shopping environment at the airport. That's all. I mean, for a transiting passenger, he requires these two aspects, very well, right? Emirates, which is the main airline servicing Dubai, is able to cater to these transiting passengers globally. If we have Air India now, which is now in the private hands, catering to similar fashion, and Air India has its home in Delhi.
Along with that, in the low-cost category, if I may put, you know, IndiGo as it starts to grow and spread its wings, Delhi has all the attributes to become a global hub over here. Yes, airlines have to play their role for Delhi to become a global hub. The government policy is very much there now incentivizing airlines to use Delhi as a hub. You know, previous policies were more inclined to encourage hubs flying from the Middle East. That has all now gone. New technology has helped airlines now to shift to direct flights from Delhi.
The 777ERs or the 787 aircraft are now flying all over. All the attributes are there. It is always a partnership between the airline and the airport. We are fully supportive of the airlines. With Air India now being in private hands, I hope they have the same global aspirations with which that actually airline started many years back, right? That is where we are also banking upon them and also on IndiGo. We're quite well-positioned from that perspective. As the Indian diaspora grows, as tourist traffic within India grows, you know, Delhi will be a main hub that will be servicing both Asia, Europe and North America.
To add on to that, basically because of the COVID, people are more preferring to have a direct flight rather than via flights. That will also enhance the connectivity of Delhi for distant places, especially in the U.S. Now we are connecting more than 80 destinations. Canada. That will improve further, I mean, reduce the dependence on the Middle East carriers and Middle East, and with that connectivity will improve. Understood. Just to kind of gel both my questions together, because capacity is also important. In the scenario that Delhi starts becoming more like a hub, the way you put it, is 30% a good number of wide-body because it kind of defines the capacity? Or have you seen instances of airports having a larger proportion also as they become a hub? No.
The number will surely go up. Okay? Honestly speaking, this also answers an earlier question by another analyst. I think Mohit asked that question is, how do we compare ourselves with Jewar? Delhi Airport is going to be an airport which targets the creamy passengers, international flyers versus the low-cost flying within domestic. 30% is just a number out of the hat. Our focus is how we can continuously increase that number because that's where the cream lies, right? Absolutely. That brings in shopping in our airports. That gives us much better per passenger fees. Airlines are also happy because we are far more efficient. The hub and spoke model that will service the domestic side of it also gets serviced.
It's a composite strategy. Don't limit yourself with that 30%. That was just an anecdotal benchmark given because the earlier comment was that we are at only 20%, right? We will grow to meet that capacity. We are gearing up to grow that capacity. It complement what. For that sake, if you look back about 4-5 years back, we used to have a lot of ATRs.
Mm-hmm.
Still the moment if the ATMs need, whether it's ATR, whether it's a jet, whether it's a bigger aircraft and even another 4. Now, almost ATRs are moved out. Only wide-body and narrow-body have come. Over a period of time, narrow-bodies also will come down, and we'll have more and more wide-bodies. See, narrow-bodies are far more efficient, and I think, maybe airline analyst can give you a better answer over there. They're far more efficient if the flight is between, you know, 5-6 hours, 6 hours. After which it becomes fuel inefficient. We need to have wider-bodied aircraft which can fly longer distances for airlines to make money, and that's our focus. That's gonna be our focus.
Noted then. Thanks for providing as much color. The third question is more micro from my side. If I see the debt numbers of Delhi and Hyderabad inside your overall debt, it seems as if your standalone debt numbers are basically going up quarter after quarter. Situation today is such that you have not capitalized on the CapEx that you are doing. At some point of time, interest costs start going up. It would be useful if you can give us some sense that let's say by FY 2024 when you start kind of paying the interest costs as well, assuming no moratorium, how are you kind of thinking of funding this thing up? Because today already your standalone debt are going up because interest costs keep on piling up.
The issue is, as far as the deal is concerned, the debt has not gone up except INR 1,000 crores which we have added this quarter. The total project cost of INR 11,500 crores approved by the board. This amount is part of that, and after that we will lease financing, we don't require any further debt. Yes, you are correct that over a period of time, once the 2024, the entire calculation is completed, the entire debt will the interest will carry to the P&L account. At the same time, our tariffs will also go up and with traffic also estimated to be 75-80 million. That will take care of the entire debt servicing.
Further monetization of the land and rising of the RIDF which will help us out in repayment of the debt also over a period of time.
Maybe this is not the right forum, and we can discuss this later on also. But the fact that you're suggesting that on land you probably want to kind of not lease out but actually construct, it just makes the dependence on internal accruals and thus the traffic growth and non-aero revenues a lot more to kind of service our commitment. Maybe later on if one can, you know, discuss the funding part over a 2-3-year perspective and whether one really needs to get external support or not would be useful for investors to kind of assess the company.
So-
I get it's a timing call, but yes.
Yeah, exactly, it's a timing call. In our modeling, the operations both at Delhi and Hyderabad are very much supported. Hyderabad of course because it has a very low revenue share. But Delhi also. It's all a question of what you are assuming, how much the non-aero will emerge, what is your assumption on the traffic. Absolutely, those can be discussed with us offline. The optionality for creating more internal accruals through monetization, we prefer to monetize non-assets than just to monetize land. That's the focus which we are now moving forward. Hence, that's why we talked about self-development.
There are number of build-to-suit opportunities where we will build for third parties for their particular requirements, and then we can monetize that building into an InvIT or a REIT, whatever makes sense, or to a sovereign or a pension fund. Similar to what Bharti has done very recently with Brookfield. Those are. That's a strategic call as to how we should be doing. We don't want to leave substantial amount of development profits in the hands of a real estate developer and we are just a landowner over there. We'd rather create value on that land. It is our land and how much does it take to create your own building? It's not a very complicated business, right? It's a timing issue, nothing else, other than that.
Okay. I'll just kind of end it off with this final question. It kind of summarizes most things that you said. Do you think that you will have to choose one of these two things, whether you monetize your land as part of existing concession or you add more airports over time? Would there be a choice that you would have to make, or do you think you can do both without external funding?
No, no. Adding airports has. It is a very different strategy. And if you look at-
I think funding perspective that's common, right? You're putting money either there or there.
Yeah, yeah. So even in the funding side of it, if we look at it and clarity will emerge over the next six months, which I can't really highlight at this particular stage. But our strategy over there is mostly in the brownfield airports and hence the equity requirement in those airports will be very minimal. We are not very aggressive on greenfield developments, but mostly on the brownfield side. Hence bringing in operational efficiency and capital efficiency in an airport that is our forte, and that's where we will be operating on. Whether it is Nagpur or, going forward, in Medan right now in Indonesia and there'll be many more opportunities that the teams are working on.
Those are mostly brownfield in nature, and hence the equity requirement is going to be minimal, which can be actually funded through internal accruals itself from a group level perspective.
Got it. Thank you a lot for the time, and your perspectives. Those are the questions.
Thank you.
Thank you.
We have our next question from the line of Renjith Sivaram from Mahindra Manulife Mutual Fund. Please go ahead.
Yeah. Hi, sir. Just a clarification. I think in the last call, you had mentioned there are certain payments of the revenue share which were not paid during that COVID time. I think we had approached the tribunal or the court to get some concession for that along with the other players also. Any update on that? Has that been passed or is it still yet to be finalized?
I think we have already clarified on the call. Maybe you have just joined a little late. As far as the 2021-2022, the amount which has not been paid is about INR 13 billion. 2022, 1 April onwards, we have already started paying the annual fee, monthly annual fee. First quarter we have already paid INR 400 crore. The matter now which is sitting before the tribunal, all the necessary documentation has already been done. Cross-examination expected in the month of October after the final arguments, and expected to have the final verdict by December or January of this year.
Okay. Okay, sir. Thanks.
Thank you. We have our next question from the line of Vipul Kumar Shah from Sumangal Investment. Please go ahead.
Hi, sir. Thanks for the opportunity. What will be our steady state revenue from lease rentals at Delhi Airport once this second tranche of land is also leased out annually? Means can you give any ballpark figure, sir?
Yeah. Once we come to 0.78, they have already taken another 2.121 they pay. The total lease rentals the company DIAL will receive is existing hospitality district is about INR 130, and the new one is INR 360. Total about INR 500 crore.
Annually?
Annually.
And-
This is about the new hotels or new monetization without considering that.
This revenue is also subject to that 44% revenue share to a Airports Authority?
Yes. As per the existing concession agreement as of today, entire revenue earned by the DIAL, we pay 45.99%. Only in case of the tariff determination, this revenue cross-subsidy will not be done. On CP3 revenue, there will not be any cross-subsidy.
Okay. Secondly, once Goa Airport becomes operational, so what is your assumptions? What kind of revenues we can generate annually once it stabilizes the operation.
This is basically forward-looking, but if you look at it, because it all depends upon the tariff determination of aeronautical revenue and non-aeronautical revenue. When we go to the full capacity of 7 to 1.5 million, we can touch about the INR 800 crore-INR 1,000 crore revenue.
Okay, sir. Thank you, and all the best.
Thank you. We have our next question from the line of Rushabh Sharedalal from Equirus PMS. Please go ahead.
Yeah. Thanks for the opportunity again. Just two small bookkeeping questions from my end. One regarding the airport land monetization, you already said that INR 2.78 billion has been taken over by Bharti. INR 2.12 billion we expect to do it by March 2023, and the payment to be received by March 2024. Any expected amount? What sort of an expected amount do you expect to receive from this transaction?
On 2.12 million, we will get another INR 600-800 crore, with regard to ADC and RSG put together.
One question on the DIAL and the Hyderabad Airport. Our revenues are INR 8.9 billion and INR 2.5 billion respectively, with EBITDA in DIAL being INR 2.9 billion and Hyderabad being INR 2.1 billion, right? Just wanted a breakdown of this INR 2.9 billion and INR 2.1 billion in aero and non-aero or aero for DIAL and Hyderabad.
In case of the DIAL, the aero revenue is INR 219 crores. In case of the Hyderabad, aero revenue is about INR 178 crores.
No, actually I wanted the EBITDA breakup of aero and non-aero.
We do not do aero, non-aero EBITDA. It is a simple P&L account where we have the revenues of aero, non-aero, other income, and other expenditure, total expenditure, then EBITDA is out.
Okay.
We will do a separate preparation of EBITDA for each line.
Okay. Yeah, that's all from my side. Thanks a lot.
Thank you. We have our next question from the line of Anshuman Ashit from ICICI Securities. Please go ahead.
Thank you, sir. Once again for the opportunity. Just wanted to know what will be the equity requirement for FY 2023 and 2024. I suppose this will be mainly for Crete, Medan, and Bhogapuram projects. If you could just tell us the details for FY 2022 and 2024.
Crete, the equity requirement in case of Crete, there is nothing because Crete investment has already been done last year itself. Medan, equity has already been completed in the month of April itself. Bhogapuram, we are not expecting much. It is only INR 30 crore-INR 40 crore this year.
Sir, what was the amount for Medan that you have already-
Medan, we have already infused $13 million, is about INR 110 crore rupees.
Okay. Sir, one final question, sir. Significant jump on the non-aero revenues, both for Delhi and Hyderabad. Could you please tell us what will be the current spend per pax, especially in light of international passenger traffic also coming in from March onwards. What will be the current level of spend per pax at both airports?
We can provide offline detail. Hyderabad, in the presentation you can see.
Slide number 18. Slide number 18, it's there.
Okay. Okay. Thank you, sir. Thank you, sir.
Thank you. I now hand over the call to Mr. Saurabh Chawla for closing comments. Over to you, sir.
Yeah, thank you. Thank you, ladies and gentlemen, for joining our quarter one call. The IR team is available for any further queries that you may have. You can take that offline. You can send us an email or enter into a call with them. Thank you so much. Have a good weekend. Bye-bye.
Thank you. On behalf of GMR Airports Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your line.