The Maharashtra state cabinet has given in-principle approval for the purchase of the Ghatkopar-Versova Mumbai Metro One, a joint venture between the Mumbai Metropolitan Region Development Authority (MMRDA) and Anil Ambani-led Reliance Infrastructure Limited (R-Infra). An estimated value of ₹4,000 crore has been placed on Ambani’s 74% stake in the project.
Initiated in 2007, Mumbai Metro One was the first metro project under the Build-Operate-Transfer (BOT) policy. MMRDA holds a 26% stake in the joint venture, named Mumbai Metro One Pvt Ltd (MMOPL). The decision to collaborate with a private firm was initially met with resistance from several MMRDA commissioners.
The state cabinet’s approval follows a report by retired IAS officer and former chief secretary Johny Joseph, who led a panel that used the discounted cash flow model for valuation. The panel incorporated findings from KROLL, a financial advisory firm, to arrive at the ₹4,000 crore valuation for R-Infra’s 74% stake.
The Mumbai Metro One project has been marred by disputes between R-Infra and MMRDA, despite being the most crowded metro in operation. Contentious issues include claims of losses by R-Infra, disagreements over commercial exploitation of metro premises and ticketing structure, as well as disputes regarding project costs.
While R-Infra asserted that the project’s cost was ₹4,026 crore, MMRDA contested this figure, stating it was ₹2,356 crore. The Brihanmumbai Municipal Corporation (BMC) also demanded property tax from MMOPL. In 2020, MMOPL urged the state government and MMRDA to buy its stake after incurring losses during the Covid-19 pandemic.
Former chief minister Prithviraj Chavan noted the dispute about the acquisition price, expressing concerns over the perceived high valuation. He stated, “The financial and legal advice to the government was that the price quoted was very high,” highlighting perceived favoritism toward the Anil Ambani group by the current government.
