Metro 1 gets huge debt relief, avoids insolvency proceedings

MMOPL has signed on July 9, a debt-restructuring agreement with the government-backed National Asset Reconstruction Company Limited (NARCL), valued at ₹2,771.32 crore

MUMBAI: Mumbai Metro One Private Limited (MMOPL), which runs the 11.4-km, Versova-Andheri-Ghatkopar metro line, has received a financial lifeline, with more than ₹1,100 crore of its debt set to be reduced. Insolvency proceedings against the company will also be withdrawn in the National Company Law Tribunal (NCLT). This would provide financial headroom for the company to improve the frequency of its services and operations.

MMOPL is a joint venture, through the Public Private Partnership (PPP) model, in which Reliance Infrastructure holds a 74% stake and MMRDA holds 26%. The metro line carries around 530,000 commuters daily on weekdays (Shutterstock)

MMOPL is a joint venture, through the Public Private Partnership (PPP) model, in which Reliance Infrastructure holds a 74% stake and MMRDA holds 26%. The metro line carries around 530,000 commuters daily on weekdays.

MMOPL has signed on July 9, a debt-restructuring agreement with the government-backed National Asset Reconstruction Company Limited (NARCL), valued at ₹2,771.32 crore.

The deal eases MMOPL’s huge debt burden and pulls the company out of insolvency proceedings, allowing it to continue running Mumbai’s first metro corridor without the shadow of financial proceedings.

Sources told Hindustan Times that this development will help MMOPL deploy funds towards operational efficiencies. “Frequency of metro trains may improve, thereby resulting in more services,” the source added.

At the end of financial year 2023-24, MMOPL’s total standalone debt was ₹4,459 crore. In December 2024, NARCL took over MMOPL’s ₹2,658-crore debt from five domestic banks – State Bank of India, IDBI Bank, Canara Bank, Indian Bank and Bank of Maharashtra.

In March 2024, MMOPL signed a debt settlement agreement with its lenders, with a commitment to pay ₹1,700 crore as a one-time settlement of its entire debt. As part of this arrangement, the Mumbai Metropolitan Region Development Authority (MMRDA) and MMOPL had made an upfront payment of ₹171 crore.

That same month, the state government through MMRDA had also passed a resolution whereby MMRDA was to acquire Reliance Infrastructure’s 74% stake for ₹4,000 crore. However, in June 2024, MMRDA did not proceed with the acquisition, saying it was unable to raise funds. Hence, the earlier decision was cancelled.