Telangana Govt to Buy L&T's Stake in Hyderabad Metro Rail for ₹2000 Crore

As per the news reports, the Telangana government has agreed in principle to assume ownership of Phase-I of the Hyderabad Metro Rail project from L&T Group. The announcement, confirmed after high-level talks on Thursday, marks a decisive state intervention in the 70 KM metro venture as the government prepares to assume both equity and outstanding liabilities.

Deal Terms And Financial Framework

Under the terms agreed, the State government will acquire L&T’s equity in concessionaire L&T Metro Rail Hyderabad Ltd by paying ₹2,000 crore as a one-time settlement. In parallel, the State will take over project debt amounting to ₹13,000 crore. 

L&T currently holds about 90% equity in the project. The infrastructure major had indicated last month its intention to offload its stake, citing operational and accumulated losses and proposed transfer either to the state or central government through a new Special Purpose Vehicle (SPV).

Negotiations, Stakeholders and Official Statements 

As per the news reports, the agreement followed detailed discussions between Chief Minister A Revanth Reddy, senior state officials and L&T Group CMD S.N. Subrahmanyan. Officials described the outcome as an in-principle settlement designed to fast-track the project’s next phase.

Implications for Phase II and Urban Transport Planning

By stepping in, the State aims to remove ownership uncertainty and create conditions to pursue Phase II approvals with the Government of India. The takeover also transfers both the operational responsibility and the financial burden to the public purse, reshaping the project’s funding and governance dynamics. 

For L&T, the settlement provides an exit from a venture it described as loss-making; for Telangana, it presents both an immediate fiscal obligation and an opportunity to steer the metro’s future expansion.

Read More: Birla Corp Subsidiary Wins Bid for Telangana's Kanpa-Junapani Limestone Block!

Larsen & Toubro Share Price Performance 

As of September 26, 2025, at 12:29 PM, Larsen & Toubro share price is trading at ₹3,779.60 per share, reflecting a gain of 3.71% from the previous closing price. Over the past month, the stock has gained by 5.82%.

Conclusion

The in-principle agreement payment of ₹2,000 crore for equity and assumption of ₹13,000 crore debt signals a major shift in the stewardship of Hyderabad Metro Phase-I. With key stakeholders aligned on the terms, the focus now moves to formalising the takeover and advancing Phase II approvals with GoI to determine the project’s next operational and funding milestones.

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