Telangana acquires Hyderabad Metro Rail from L&T for ₹1,461 crore
Synopsis
Telangana has formally bought out L&T's stake in Hyderabad Metro Rail Phase I for ₹1,461 crore — but the bigger number is the ₹13,538 crore debt the state has now guaranteed. With Phase II on the horizon, state ownership removes a critical coordination barrier, but it also concentrates financial risk squarely on the Telangana exchequer.
Key Takeaways
The Telangana government acquired 100% equity of L&T Metro Rail (Hyderabad) Limited for ₹1,461.47 crore on 29 April 2025 .
The share purchase agreement was signed by HMRL MD Sarfaraz Ahmad , D.K.
Sen of L&T, and KVB Reddy of LTMRHL.
Outstanding debt of ₹13,538.53 crore , previously guaranteed by L&T, will now be refinanced with a Telangana government guarantee .
Hyderabad Metro Phase I spans 69 km across three corridors and serves approximately 4.5 lakh passengers daily , logging 86 crore trips since November 2017 .
The acquisition is expected to enable seamless integration with the proposed Phase II metro network.
The Telangana government on Wednesday, 29 April 2025, formally acquired Hyderabad Metro Rail Phase I from Larsen & Toubro Limited (L&T) for ₹1,461.47 crore, signing a share purchase agreement that transfers 100 per cent equity shares of L&T Metro Rail (Hyderabad) Limited (LTMRHL) to the state-owned Hyderabad Metro Rail Limited (HMRL). The move marks a significant shift in ownership of one of India's largest metro systems built under a public-private partnership model.
Key Details of the Acquisition
The share purchase agreement was signed by HMRL Managing Director Sarfaraz Ahmad on behalf of HMRL, D.K. Sen on behalf of L&T Ltd, and KVB Reddy on behalf of LTMRHL. The signing took place in the presence of Chief Secretary and HMRL Chairman K. Ramakrishna Rao and Special Chief Secretary, Municipal Affairs and Urban Development, Jayesh Ranjan, along with senior management of both L&T and LTMRHL.
The transaction was advised by IDBI Capital, with legal advisory services provided by Saraf & Partners. Earlier in the day, L&T Chairman and Managing Director S.N. Subrahmanyan called upon Chief Minister Revanth Reddy, signalling the significance of the handover at the highest levels of both organisations.
The Debt Refinancing Arrangement
According to an HMRL statement, the outstanding debt of LTMRHL — amounting to ₹13,538.53 crore as on 30 April — which was previously guaranteed by L&T, will now be refinanced with a guarantee issued by the Telangana government. This effectively transfers the financial liability from a private conglomerate to the state exchequer, a detail that underscores the scale of the state's commitment to the metro network.
About Hyderabad Metro Rail Phase I
LTMRHL has been operating Hyderabad Metro Rail Phase I since November 2017, covering three corridors with a total network length of 69 km. The system currently serves an average daily ridership of approximately 4.5 lakh passengers and has recorded around 86 crore passenger trips since inception — making it one of the busiest metro networks in the country.
The Telangana government had announced its decision to take over Phase I last year, with HMRL designated as the acquiring entity. This acquisition completes that process.
What the Takeover Means for Phase II and Commuters
According to HMRL, bringing Phase I under state control is expected to enable closer strategic alignment with the proposed Phase II network, facilitating seamless integration in planning, execution, and service delivery. A unified command structure is projected to deliver a more cohesive and commuter-friendly metro experience across Hyderabad. Notably, Phase II planning has been a priority for the Revanth Reddy government, and state ownership of Phase I removes a key coordination bottleneck between the two networks.
With the acquisition now formalised, attention will turn to how quickly HMRL can operationalise the integrated governance structure and advance Phase II timelines.
Point of View
461 crore is almost a footnote — the real story is the state absorbing ₹13,538 crore in debt guarantees. Telangana is effectively betting that unified control will unlock Phase II faster and generate enough ridership revenue to service that liability. The PPP model that built Phase I is now being unwound, raising a broader question: if state ownership is the answer for metro rail, what does that signal for future private investment in urban infrastructure across India? The Revanth Reddy government inherits both an asset and a significant balance-sheet obligation — how it manages the latter will define whether this takeover is celebrated or scrutinised in years to come.
NationPress
1 May 2026
Frequently Asked Questions
Why did Telangana acquire Hyderabad Metro Rail Phase I from L&T?
The Telangana government decided to take over Hyderabad Metro Rail Phase I to enable closer integration with the proposed Phase II network and bring metro operations under unified state control. The acquisition, completed on 29 April 2025, was announced last year with HMRL designated as the acquiring entity.
How much did Telangana pay for Hyderabad Metro Rail Phase I?
The state acquired 100% equity shares of L&T Metro Rail (Hyderabad) Limited at an equity value of ₹1,461.47 crore through a share purchase agreement. Additionally, the existing debt of ₹13,538.53 crore will be refinanced with a Telangana government guarantee.
What happens to the existing debt of L&T Metro Rail Hyderabad?
The outstanding debt of LTMRHL, amounting to ₹13,538.53 crore as on 30 April, which was previously guaranteed by L&T, will now be refinanced with a guarantee issued by the Telangana government. This transfers the financial liability from L&T to the state.
How large is the Hyderabad Metro Rail Phase I network?
Hyderabad Metro Rail Phase I spans 69 km across three corridors and has been operational since November 2017. It currently serves approximately 4.5 lakh passengers daily and has recorded around 86 crore passenger trips since inception.
What does this acquisition mean for Hyderabad Metro Phase II?
With Phase I now under state ownership, HMRL can align planning, execution, and service delivery for both phases under a single governance structure. This is expected to remove coordination bottlenecks and accelerate the rollout of the proposed Phase II network.
