Telangana govt acquires 100 percent stake in Hyderabad Metro Rail Phase-I

The Telangana government has formally approved the acquisition of L&T’s entire equity stake in Hyderabad Metro Rail Limited, making Phase-I of the project a state-owned entity.

Hyderabad: Following recommendations of a cabinet sub-committee, the State government issued orders formally approving the acquisition of 100 per cent equity stake held by the Larsen & Toubro (L&T) in L&T Metro Rail (Hyderabad) Limited (L&TMRHL) of Hyderabad Metro Rail project phase-1.

Based on proposals submitted by the Managing Director of HMRL, the orders also permitted availing a loan from the Indian Railway Finance Corporation (IRFC) and execution of agreements. The move prepares the ground for the HMR phase-1 running over 69.2 km in the city to become a state-owned entity.

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The MA&UD orders on Friday mention takeover of Hyderabad Metro Rail Project Phase-I – Share Purchase Agreement, availing loan from IRFC to finance the takeover, requirement of letter of undertaking from GoTG, State Government Guarantee, requirement of RBI Mandate (Direct Debit Mandate), term sheet, tripartite agreement and also funds from HMDA for financing equity and other related matters.

The orders mention HMRL Managing Director’s proposals relating to acquisition of 100% equity stake of L&T in LTMRHL, availing loan from IRFC, execution of agreements, and other connected matters.

In the orders, the government approved the above recommendations made by the Cabinet Sub-Committee during its meeting held on April 10, 2026 and accorded permission to Managing Director, HMRL to sign the Share Purchase Agreement (SPA) after taking approval of the Cabinet Sub-Committee (CSC) for resource mobilisation.

It also approved the IRFC Term Sheet, in its present form with a condition that all clauses related to/associated with providing budgetary support will be deleted, for providing a loan of Rs. 13,615 crore (debt as on April 30, 2026). The proposal to provide Guarantee by GoTG for the aforesaid loan amount; and Letter of Undertaking from GoTG to IRFC for refinancing the debt of LTMRHL which is approximately Rs. 13,615 crore (as on April 30, 2026).