NEW DELHI. Indian Railway Finance Corporation Ltd. (IRFC), has signed a landmark Rs 13,527 crore term loan agreement with L&T Metro Rail (Hyderabad) Limited (L&TMRHL). Signed in the presence of IRFC CMD and CEO Manoj Kumar Dubey and Telangana Chief Secretary K. Ramakrishna Rao, the 20-year agreement will refinance existing debt obligations, including non-convertible debentures, commercial papers, and term loans. This massive financial restructuring follows the complete transfer of L&TMRHL ownership from Larsen and Toubro Limited to the Government of Telangana, transforming the metro network into a strategic state-owned public mobility asset.
The restructuring replaces higher-cost debt with competitively priced long-term rupee financing that features zero processing fees, commitment charges, or prepayment penalties. To ensure seamless servicing of all dues, the transaction is backed by a robust credit enhancement framework from the Government of Telangana, which includes an unconditional and irrevocable undertaking, a state government guarantee, and an RBI-backed direct debit mandate. IRFC CMD Manoj Kumar Dubey noted that the deal demonstrates how large-scale urban infrastructure can be financed domestically through efficient funding structures aligned closely to actual project cash flows.
Spanning 69.2 kilometers across three corridors with 57 stations, the Hyderabad Metro Phase-I is one of the world’s largest transit networks developed under a public-private partnership model and currently handles over 5 lakh daily passenger journeys. This stable financial foundation will now allow the Government of Telangana to accelerate its phased expansion plans, extending sustainable metro connectivity into emerging growth corridors and improving last-mile connectivity. For IRFC, this transaction represents a strategic diversification of its financing portfolio beyond conventional railway assets into high-impact public utility infrastructure with strong national developmental relevance.
