A significant move has been initiated by the National Asset Reconstruction Company Ltd (NARCL) to provide financial relief to Mumbai Metro One Private Limited (MMOPL), the operator of the Versova-Andheri-Ghatkopar metro line. An offer has been made by NARCL to acquire MMOPL’s debt of ₹2,658 crore, as confirmed by officials.
The joint venture between Reliance Infrastructure, holding a 74% stake, and the Maharashtra government’s Mumbai Metropolitan Region Development Authority (MMRDA), which owns 26%, has been grappling with financial distress. Debts owed by MMOPL to five public sector banks—State Bank of India, IDBI Bank, Canara Bank, Indian Bank, and Bank of Maharashtra—are now set to be restructured under NARCL’s resolution plan.
It was revealed by sources that a mix of cash and security receipts has been offered by NARCL to the lenders. This step is expected to provide financial breathing room for MMOPL, with officials noting that a reorganization of the company’s financial structure could be facilitated, improving metro operations in the process.
India’s first metro line built under a public-private partnership model, the Mumbai Metro 1, spans 11 kilometers and serves as a vital east-west corridor in the city. The line, which accommodates nearly 450,000-500,000 daily commuters, connects densely populated residential and commercial hubs. Despite its success, overcrowding has been cited as a major concern, with demands for increasing train capacity from four to six coaches being repeatedly voiced by passengers.
The resolution of MMOPL’s debt has followed years of financial challenges. A petition to initiate insolvency proceedings was filed by its lenders in 2023 at the National Company Law Tribunal (NCLT). However, insolvency proceedings were dismissed earlier this year after a one-time settlement agreement was reached. The agreement had paved the way for discussions around a potential acquisition of MMOPL by the Maharashtra government, with a ₹4,000-crore buyout of Reliance Infrastructure’s 74% stake being approved.
Despite this, the state government reversed its decision in June 2024, citing insufficient funds. Efforts by Reliance Infrastructure to exit the project, which began in 2020, have remained unsuccessful due to disagreements over valuation.
The acquisition of bad loans by NARCL, which was set up in 2021 to manage non-performing assets in the banking sector, has offered a potential solution. By consolidating MMOPL’s debt, relief has been provided to lenders and a chance for the metro operator to reorganize its financial framework has been created. The involvement of NARCL is expected to bring new opportunities for the metro system, which continues to be a critical component of Mumbai’s transportation infrastructure. Public sector banks, which hold a majority stake in NARCL, have enabled the process, while the remaining ownership is shared with private lenders.