IRFC Secures Rs 13,527 Crore Loan to Refinance Hyderabad Metro, Boosts Urban Rail Financing

IRFC Secures Rs 13,527 Crore Loan to Refinance Hyderabad Metro, Boosts Urban Rail Financing​

Indian Railway Finance Corporation Ltd. (IRFC), a Navratna Central Public Sector Enterprise under the Ministry of Railways, successfully signed a Rs 13,527 crore term loan agreement with L&T Metro Rail (Hyderabad) Limited (L&TMRHL). This financing deal is designed to refinance the existing debt obligations of the Hyderabad Metro Rail project, marking a major milestone in the country's urban transit sector.

The transaction underscores IRFC's evolving role as a diversified infrastructure financing institution. By leveraging its expertise in long-term transportation finance, the deal aligns with the Government of India's vision for a Viksit Bharat (Developed India).

The loan agreement was signed in the presence of IRFC CMD and CEO Manoj Kumar Dubey, along with Telangana Chief Secretary K. Ramakrishna Rao, emphasizing the strategic importance of the initiative for enhancing urban mobility infrastructure.

During the signing, CMD & CEO of IRFC, Manoj Kumar Dubey, stated that the transaction reinforces IRFC's capability to structure innovative, long-tenor financing solutions for nationally significant infrastructure assets, while committing to supporting sustainable urban mobility through efficient capital mobilization.

Strengthening Financial Stability​

The refinancing initiative follows the transfer of 100 per cent ownership of L&TMRHL from Larsen & Toubro Limited to the Government of Telangana via Hyderabad Metro Rail Limited (HMRL). This conversion establishes the metro network as a strategic public mobility asset under state ownership, creating a stronger financial basis for the phased expansion of Hyderabad's metro ecosystem.

The facility will refinance existing debt obligations, which include Non-convertible Debentures (NCDs), commercial papers, and term loans. This orderly refinancing enables existing lenders an exit while significantly improving the project's long-term financial sustainability.

Key details of the refinancing facility include:

Impact on Hyderabad's Urban Mobility​

Hyderabad Metro Rail Phase-I, spanning 69.2 kilometres across three corridors with 57 stations, is recognized as one of the largest metro projects developed under the Public-Private Partnership (PPP) model globally. The existing network serves over 5 lakh passenger journeys daily and acts as a vital backbone for Hyderabad's urban transport.

This financing support is viewed as critical for strengthening the city's urban mobility infrastructure. The expansion will enable the Government of Telangana to extend efficient and sustainable metro connectivity to emerging growth corridors, enhancing carrying capacity and improving last-mile connectivity across the metropolitan region.

Dubey highlighted the structure's efficiency, noting that the refinancing replaces higher-cost debt with competitively priced long-term rupee financing. The transaction is supported by a robust credit enhancement framework, including an unconditional and irrevocable undertaking by the Government of Telangana for servicing all dues payable to IRFC, a state government guarantee, and an RBI-backed direct debit mandate.

According to Dubey, "IRFC stands ready to serve as a trusted domestic financing partner, channeling Indian savings into India's infrastructure on Indian terms."

Leveraging its strong credit profile, sovereign-backed borrowing strength, and zero-NPA track record, IRFC is positioned to provide competitive long-term financing solutions for metro rail systems and other public infrastructure assets. The refinancing is expected to materially strengthen the project's financial flexibility, establishing a replicable financing model for urban transit systems across India.

IRFC Stock Price Movement​

Shares of Indian Railway Finance Corporation Limited are gaining momentum, edging up 2.58% as of 11:57 AM, trading near ₹100.72. The stock has seen brisk activity throughout the live session, with over 8.16 million shares traded.