GMR Airports Limited — Q2 FY26 earnings call

Call held 14 Nov 2025

Management summary

GMR Airports delivered a strong Q2 FY26, marked by significant revenue and EBITDA growth, and a return to profitability, driven by tariff revisions and strategic non-aero business expansion. Despite a temporary dip in traffic and an increase in net debt, the company is confident in its growth trajectory, actively pursuing refinancing and infrastructure development, with key projects like Bhogapuram nearing completion.

Highlights

  • Consolidated total income surged 45% YoY to INR 37.5 billion, propelled by revised tariffs at Delhi, duty-free and cargo takeovers, and sustained growth at Hyderabad.

  • Consolidated EBITDA grew 59% YoY to INR 15.3 billion, with the EBITDA margin improving to 53% despite a notional forex loss of INR 0.6 billion.

  • GMR Airports achieved a profit of INR 351 million from continuing operations, a significant turnaround from a loss of INR 4.3 billion in Q2FY25.

  • Successfully refinanced INR 59 billion in non-convertible bonds, saving 300 basis points, and INR 10 billion for Delhi Airport, saving 125 basis points.

  • Strategic expansion into non-aero businesses (Delhi duty-free, Hyderabad duty-free, Delhi cargo) is contributing to revenue growth and is expected to yield full quarter impact in Q3.

Concerns

  • Consolidated net debt (excluding FCCBs) increased by INR 12 billion from Q1 FY26 to INR 340 billion.

  • Overall traffic at GMR Airport's operated airports (excluding Cebu) fell 3.5% YoY to 27.8 million passengers in Q2 due to temporary disruptions.

  • Mopa (Goa) Airport's total income declined 15% YoY to INR 836 million, with aero revenues down 27% due to incentive programs to attract airlines.

Key financials

  1. Total Income 37.5 Bn +45%YoY
  2. EBITDA 15.3 Bn +59%YoY
  3. EBITDA Margin 53%
  4. Profit from Continuing Operations 351 Mn
  5. Net Debt (excl. FCCBs) 340 Bn
  6. Traffic (excl. Cebu) 27.8 Mn -3.5%YoY

What they filed

Q1 FY27: revenue up 156.7%, net profit up 132.6% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue282 271 508 478 945 +235%1,239 +357%1,581 +211%1,227 +157%
EBITDA114 121 358 109 239 +110%343 +183%675 +89%386 +254%
Net profit-63 -49 68 -178 -133 −111%50 +202%403 +493%58 +133%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

SegmentTotal IncomeDuty-free SPP (H1FY26)Non-aero Revenues GrowthEBITDA
Delhi Airport18.5 Bn₹1,046——
Hyderabad Airport6.7 Bn₹77738%4.3 Bn
Mopa (Goa) Airport836 Bn—20%121 Bn

Capital allocation

high confidence
  • Capex Capex disclosed
    • Overall consolidated capex (H1FY26) ₹1,800 Cr
    • Bhogapuram Airport development
    • Crete Airport development
    • Operational capex (DIAL & GHIAL) ₹500 Cr
    In first half, we have done INR1,800 crores capex at the overall consol level... Bhogapuram, where we continue to draw down debt to complete the Bhogapuram airport... the other capex which is happening is at Crete... Operational capex is always incurred by DIAL and GHIAL, which could be in the range of INR500 crores to INR700 crores, both the airports together.
  • Debt Net ₹340 Bn
    • Refinance Raised non-convertible bonds to repay INR 50 billion existing debt + INR 8.5 billion redemption premium, at 10.225%-10.425% effective cost (300 bps saving). ₹59 Bn
    • Refinance Raised 15-year non-convertible debentures at 8.75% coupon rate for Delhi, refinancing debt at 9.98% (125 bps saving). ₹10 Bn
    • New borrowing Raised working capital loans for duty-free operations. ₹3 Bn
    Consolidated net debt excluding the FCCBs of INR27.3 billion which are deep into money stood at INR340 billion, increasing by INR12 billion versus Q1 FY26.

Guidance & targets

Revenue

  • Non-aero revenue growth Revenue · ongoing · High confidence 14-15%
    for us the target we generally take is about in the range of 14% to 15% kind of growth, which is a combination of spend growth as well as the traffic growth.

    — Rajesh Arora

  • Delhi Airport aero yield per pax Revenue · ongoing · High confidence INR 360
    However, as per the tariff determination, it is INR360 yield per pax, that will continue to be there.

    — GRK Babu

Traffic

  • Hyderabad Airport overall traffic growth Traffic · this year · High confidence 10-12%
    So, we are expecting overall, compared to last year, this year, there will be a growth around 10% to 12%.

    — GRK Babu

Capex

  • Hyderabad Airport expansion investment Capex · CY 2027 kick-off · High confidence INR 14,000 crores
    So, we are proposing for an expansion with INR14,000 crore... we are expecting that it should kick on in the CY 2027.

    — GRK Babu

Project Completion

  • Bhogapuram Airport go-live Project Completion · next 9-12 months · High confidence 9-12 months
    Bhogapuram is already complete and it should go live over the next 9 to 12 months.

    — Saurabh Chawla

  • Crete Airport completion Project Completion · next two years · High confidence within two years
    Crete where we have a minority share and there is no further contribution of our investment into Crete. So, that will get completed over the next two years.

    — Saurabh Chawla

Depreciation

  • Yearly depreciation reduction Depreciation · yearly · High confidence INR 150 crores
    the depreciation will come down on the existing assets by about INR150 crores yearly. That means every quarter maybe around INR35 to INR38 crores.

    — GRK Babu

Cost of Debt

  • Interest expense Cost of Debt · next quarter onwards · Medium confidence slightly go down further
    the current interest whatever we have shown in this quarter will slightly go down further because the full impact of the reduced interest rates will come to the next quarter onwards.

    — GRK Babu

What to watch in Q3 FY26

Bhogapuram Airport operationalization

next 9-12 months
Current 87.5% physical progress
Target Go live

Why it matters

Commercial operations of a new airport will add significant revenue and capacity to the portfolio.

At Bhogapuram, 87.5% of physical progress has been achieved as of September '25... Bhogapuram is already complete and it should go live over the next 9 to 12 months.

Risks & concerns

  • Geopolitical and operational challenges leading to temporary traffic disruptions

    medium

    Regional tensions and isolated incidents caused a 3.5% YoY traffic fall in Q2, but management views this as a temporary pause, not a demand slowdown, expecting a pick-up.

    Management acknowledged

  • Traffic decline at operated airports in Q2

    medium

    Traffic at GMR Airport's operated airports fell 3.5% YoY in Q2 due to temporary disruptions from geopolitical events and runway 10/28 upgradation at Delhi Airport, but a pick-up is expected.

    Management acknowledged

  • Notional forex loss on FCCBs

    low

    A notional forex loss of INR 0.6 billion in Q2 due to Euro/INR rate fluctuation is considered non-cash and notional, as FCCBs are deep in money and expected to convert to equity.

    Management downplayed

Q&A highlights

8 direct
GMR Airports standalone non-aero businesses Direct
we have created this GAL platform at the listed entity to get into non-aero business. And recently, it started operations on Delhi duty-free as well as cargo. Hyderabad duty-free has also moved to GMR Airports.

Clarifies the strategic shift to bring non-aero businesses directly under GMR Airports Limited (GAL), impacting standalone revenues and value capture.

Asked by Mohit Kumar

Delhi Airport real estate monetization (12 million sq ft third-party projects) Direct
it is basically the other third-party projects with 12 million square feet built-up area... Yes, they are all monetized.

Distinguishes between GAL's self-development strategy and legacy third-party monetized land, clarifying revenue streams and future potential.

Asked by Mohit Kumar

Hyderabad Airport next phase of expansion (INR 14,000 crores) Direct
So, we are proposing for an expansion with INR14,000 crore... we are expecting that it should kick on in the CY 2027.

Provides details on a significant future capex plan for Hyderabad, outlining the scale and timeline for long-term growth and capacity expansion.

Asked by Mohit Kumar

Delhi Airport master plan and capex for future projects Direct
it is more from a design and efficiency perspective... There is no significant capex or specific capex that is planned at Delhi airport, at least in the fourth control period.

Clarifies that Delhi's master plan focuses on efficiency and international traffic capture rather than new large-scale capex in the near term, managing investor expectations on future spending.

Asked by Prateek Kumar

Overall capex for FY26 and FY27 Direct
there is no major capex happening in the whole group, other than the two projects which are live, which is one is Bhogapuram... and the other capex which is happening is at Crete.

Provides clarity on the company's capex pipeline, indicating that major spending is concentrated on Bhogapuram and Crete, with other capex being operational maintenance.

Asked by Prateek Kumar

Update on HRAB (Hybrid till) matter with AERA Direct
AERA has appealed to the Supreme Court on this matter... The case is now posted, I think in December for hearing.

Gives an update on a key regulatory matter that could impact Delhi Airport's revenue model, with a timeline for the next hearing.

Asked by Prateek Kumar

Sustainability of non-aero revenue growth and per pax spending Direct
for us, 15% growth year-on-year in the non-aero revenue is something which we will always keep as a minimum target for us to grow.

Sets expectations for non-aero revenue growth, indicating that current high growth is partly due to new outlets and that 14-15% is a sustainable target.

Asked by Aditya Mongia

Delhi Airport concession renewal (30+30 years) Direct
It's a very smooth affair. There's a contract in place. And as long as we are maintaining our ASQ scores, the renewal is pretty much given. So, there are no specific renegotiations that can be opened as per the concession agreement, as per OMDA.

Reassures investors about the automatic and smooth renewal of the Delhi Airport concession, dispelling concerns about potential renegotiations or instability.

Asked by Aditya Mongia

3 min read 7 chapters

Detailed narrative

Overall Financial Performance

GMR Airports delivered a strong Q2 FY26, with consolidated total income surging 45% year-on-year to INR 37.5 billion. This robust growth translated into a 59% increase in EBITDA, reaching INR 15.3 billion, with the EBITDA margin improving to 53% for the quarter. The company successfully reversed its previous year's loss, reporting a profit of INR 351 million from continuing operations, compared to a loss of INR 4.3 billion in Q2 FY25.

Delhi Airport's Performance and Strategic Initiatives

Delhi Airport was a significant growth driver, with its total income rising 34% year-on-year to INR 18.5 billion. This was primarily due to a substantial 166% year-on-year increase in aero revenues, following the implementation of revised tariffs from mid-April. The company also took over Delhi's duty-free and cargo businesses, contributing to healthy non-aero and CPD income, with duty-free SPP increasing to INR 1,046 in H1 FY26 from INR 1,005 in H1 FY25.

Hyderabad Airport's Consistent Growth and Expansion Plans

Hyderabad Airport continued its strong performance, recording a 17% year-on-year increase in total income to INR 6.7 billion. Non-aero revenues were particularly robust, growing 38% year-on-year, which helped drive a 17% rise in EBITDA to INR 4.3 billion, marking its highest quarterly EBITDA on record. The airport is nearing full capacity, prompting a proposed INR 14,000 crore expansion, expected to kick off in CY 2027, to include a new terminal, runway, and cross taxiways.

Strategic Non-Aero Business Expansion

GMR Airports is actively transforming into a consumer business by bringing non-aero operations directly under GMR Airports Limited (GAL). This quarter saw GAL take over Delhi duty-free and cargo businesses, as well as Hyderabad duty-free operations, with the full quarter impact expected in Q3. The company targets a sustainable 14-15% year-on-year growth in non-aero revenues, driven by new outlets and improved margins, with current high growth partly attributed to new outlet openings.

Refinancing and Debt Management

The company successfully refinanced INR 59 billion in non-convertible bonds, repaying INR 50 billion of existing debt and an INR 8.5 billion redemption premium, achieving a 300 basis point saving with an effective cost of 10.225%-10.425%. Additionally, INR 10 billion was raised for Delhi Airport via 15-year NCDs at 8.75%, saving 125 basis points. The board has approved raising INR 21.5 billion for refinancing Hyderabad Airport's 2026 foreign currency bonds, demonstrating proactive debt management.

Infrastructure Development Progress

Significant progress was made on new airport constructions, with Bhogapuram achieving 87.5% physical completion and expected to go live in the next 9-12 months. Crete Airport, where GMR holds a minority share, is 60% complete and anticipated to finish within two years. The Delhi Cargo City development, spanning 50.5 acres, is progressing, with the first phase (30.5 acres) targeted for completion much ahead of the 24-30 month timeline, enhancing cargo infrastructure.

Traffic Dynamics and Outlook

Overall traffic at GMR's operated airports declined 3.5% year-on-year in Q2 to 27.8 million passengers (excluding Cebu), primarily due to temporary disruptions from geopolitical events and runway upgradation at Delhi. However, with Delhi's runway fully operational and Terminal 2 resuming full operations, management expects a pick-up in traffic for the seasonally strong Q3 and the winter schedule. Hyderabad is projected to see 10-12% overall traffic growth this year.

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