GMR Infra investors await value unlocking as airports business takes wings

In its Q2 results media release, GMR Infrastructure Ltd said it has received all key regulatory approvals for Tata group, Singapore’s sovereign wealth fund GIC Pte Ltd and Hong Kong-based SSG Capital Management Ltd to buy a 44.44% stake in GMR Airports Ltd. Clearance from the government (expected in a few weeks) is now critical to unlock value for shareholders who have borne the brunt of value erosion for over a decade.

The deal will carve out the profitable airports business into a separate entity, which would then be demerged from the other non-airports businesses. Note that the airports segment has churned out cash steadily in the last few quarters, and boosted GMR’s overall Ebitda (earnings before interest, tax, depreciation and amortization).