BENGALURU: The Bangalore Metro Rail Corporation Limited (BMRCL) is on a sound financial footing and it has been given a stable rating by an entity of the US-based Fitch Group, one of the three major global credit rating agencies. Fitch’s India Ratings and Research as well as Brickwork Ratings India Pvt Ltd have recently awarded it the ‘Ind AA’ rating, revealed a top official.
The good rating is an affirmation that the BMRCL has enough cash in hand to service its loan interests and manage its borrowings, the official explained. The Corporation had received the same rating in 2019 and 2020. However, there was much cause for concern this year due to the high operational losses caused due to a dip in ridership.
Explaining the factors which helped in the high rating, the agency explained that Karnataka’s stable economic growth and the cost escalations of BMRCL that will be borne by its sponsors, the Central and State Governments. The BMRCL had an extensive support mechanism, it added. Sovereign loans from both Japan International Cooperation Agency (JAICA) and the Agence Francaise de Developpement via the Government of India to BMRCL helped in timely debt servicing, the credit rating agency added.
Pointing out to the financial losses caused by the Covid-19 pandemic, it said that social distancing and restrictions impacted ridership. “With Metro operations being suspended from April to August 2020, BMRCL reported ridership of only 17.27 lakh in financial year 2021,” it said.
Unaudited results for nine months published
The unaudited results of BMRCL for the nine months from April 1 to December 31, 2021 have just been published on its website. “The heartening aspect is that the operational efficiency has improved,” said an official. The total expenditure incurred during the 12 months of 2020-2021 stood at Rs 985.51 crore while the expenditure for the first nine months of this financial year stood at Rs 773.38 crore, reveals the balance sheet. “It is expected to touch Rs 1,031 crore by March 2022, an increase of just 5% over the previous year, “ the official added.
The huge plus is that while BMRCL spent Rs 12.37 crore for every crore earned the previous year, it had to spend only Rs 6.1 crore for every crore earned during the nine months, it is learnt. With the pandemic receding, BMRCL is expected to witness a surge in fare revenue from now on, the official added.