IRFC signs Rs 13,527 cr refinancing deal for Hyderabad Metro project
Indian Railway Finance Corporation Ltd (IRFC) has signed a Rs 13,527 crore term loan agreement with L&T Metro Rail (Hyderabad) Limited to refinance the debt obligations of the Hyderabad Metro Rail project, marking one of the largest refinancing transactions in India’s urban transit sector.
The agreement, signed on Monday, is being seen as a major step in strengthening long-term financing for urban mobility infrastructure and reflects IRFC’s expanding role beyond traditional railway financing. The loan agreement was signed in the presence of IRFC Chairman and Managing Director Manoj Kumar Dubey and Telangana Chief Secretary K. Ramakrishna Rao.
According to IRFC, the refinancing aligns with the Government of India’s vision of “Viksit Bharat” and demonstrates the corporation’s growing capability to provide long-tenor financing solutions for large infrastructure projects.
Speaking on the occasion, Dubey said the transaction underlined IRFC’s commitment to supporting sustainable urban mobility through efficient capital mobilisation and innovative financing structures.
The refinancing follows the transfer of 100 per cent ownership of L&T Metro Rail (Hyderabad) Limited from Larsen & Toubro Limited to the Government of Telangana through Hyderabad Metro Rail Limited, effectively bringing the metro network under State ownership.
Officials said the funding facility would refinance existing liabilities, including non-convertible debentures (NCDs), commercial papers and term loans, thereby enabling an orderly exit for existing lenders while improving the long-term financial sustainability of the metro project.
Hyderabad Metro Rail Phase-I spans 69.2 kilometres across three corridors with 57 stations and is considered among the world’s largest metro rail projects developed under the public-private partnership (PPP) model.
The metro network currently serves more than five lakh passenger journeys daily and forms a key component of Hyderabad’s public transport infrastructure.
Officials stated that the refinancing would support future expansion plans, including improved connectivity to emerging urban corridors and enhanced last-mile transport integration.
The loan has been structured over a 20-year tenure with quarterly repayments. IRFC said the refinancing replaces higher-cost debt with competitively priced long-term rupee financing and does not include processing fees, commitment charges or prepayment penalties.
The transaction is backed by a multi-layered credit enhancement mechanism, including an unconditional undertaking from the Government of Telangana, a State Government guarantee and an RBI-backed direct debit mandate.
Dubey said the deal demonstrated that large-scale urban infrastructure projects could be financed domestically through long-term funding structures aligned with project cash flows. He added that IRFC was prepared to serve as a trusted domestic financing partner by channeling Indian savings into infrastructure development.
Officials noted that the refinancing framework could serve as a model for financing urban transit systems in other parts of the country as India continues to expand investment in sustainable mobility and integrated urban infrastructure.
For IRFC, the agreement represents another significant step in diversifying its financing portfolio beyond conventional railway assets into broader public infrastructure projects of national importance.
