Bangalore operator likely to steal the thunder

The GMR consortium-built Rajiv Gandhi International Airport (RGIA) at Hyderabad may have stolen a small march, time-wise, over the Bengaluru counterpart by opening on March 23. However, a launch hiccup apart, it looks like the Bangalore operator will be stealing the thunder eventually at the cash counters.
BIA’s promoter consortium Siemens-Unique Zurich-L&T may have hit a gold-mine at Devanahalli, going by just the air traffic numbers, according to what Business Line gathered from neutral industry-watchers. Airport company BIAL (Bangalore International Airport Ltd) has not shared any revenue expectations so far.
By BIAL’s reckoning, Bengaluru should be ending the first year with at least 11 million passengers and grow at 20 per cent each year. Hyderabad, which has seen similar investment of nearly Rs 2,500 crore, expects traffic of some 7 million.
This traffic will be the main revenue source initially, and the user fees to be levied on departing passengers is seen as a major cash cow, apart from air-side revenues such as landing-parking fees; and royalties from cargo and ground-handling agencies.
Bangalore’s attraction for airlines will be undeniably greater than Hyderabad’s, and it could break even in the second year itself, one observer said. If HAL airport last year made a turnover of Rs 650 crore, BIAL could make at least thrice that figure during the first full year. Similar international airports break even in seven-eight years. The prime 4,000-acre airport land is another golden goose, as land rates have appreciated sharply to a couple of crores an acre.
24/03/08 Madhumathi D.S./Business Line

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Categories: Airports Mar 2008, New Mar 2008