Airport village to perk up GMR's non-aero revenues

The GMR Group, developer of the green-field international airport at Hyderabad, is looking at garnering non-aero revenues as much as, or even more than what it expects from flight-related activities through the 'airport village', which it plans to develop in a 1,000 acre land within the airport premises.

"We expect the revenue stream to shift in favour of non-aero revenues in 60:40 ratio by 2014 at the Hyderabad International Airport," Madhu Terdal, CFO (corporate), GMR Group, said.

According to him, the company is open to the modalities for the development of airport village, which is part of the 5,400 acre land given to the GMR-led consortium for the construction of green-field airport.

"We may float a separate company or form a joint venture or may even lease out the land for construction of different projects," he said.

According to T Srinagesh, chief operating officer of the Hyderabad International Airport Limited (HIAL), the airport village will consist of all the commercial and retail activities, including business hotels and shopping malls.

"The entire airport will be designed in such a way that even families other than the passengers can visit the place," Srinagesh told mediapersons.

The company, however, expects 60 per cent of its revenues from aero activities at the time of the commencement of operations in March 2008.

Aero revenues include income from operations such as flight landing, parking, passenger services, user development fee, cargo and ground handling, aircraft maintenance and fuel supply while non-aero operations include entry fee, car parking, commercial revenues from hotels, and business parks among others.

Besides developing business hotels, five star hotels, offices and malls, the company also plans to develop industrial parks at the airport village, according to Srinagesh.

The Rs 1,760-crore airport project, which is designed to handle seven million passengers from the first year of its operations, is expected to handle about 6.5 million passengers in 2008-09 based on the average 30 per cent growth in passenger arrivals at Hyderabad.

The first and second phases of the project have been combined based on higher growth projections in terms of passenger arrivals to ensure the airport capacity at seven million passengers at the time of commencement of operations as compared with 5 million capacity planned in the first phase of the project, according to officials.

The third phase of the project, which does not have a time frame as of now, will enhance the passenger handling capacity to 20 million by way of adding one more runway among other facilities, according to Srinagesh.