Maytas Infrastructure & Satyam Connection

Shares of Maytas Infrastructure, a company promoted by Satyam family are falling after Andhra Pradesh Chief Minister said the state government is reviewing the ability of the company to carry out the work awarded to it. Earlier, CM had reported to have said Maytas and its joint venture partners together have been awarded Rs 13,000-crore worth of works out of Rs 38,000 crore Pranahita-Chevella lift irrigation project. Maytas consortium was also awarded Rs 12,000-crore Hyderabad Metro Project and Rs 1,200-crore Machilipatnam Sea Port project by the state government.

The Hyderabad Metro project is expected to announce its financial closure by March 2009, while Sea Port project will take about six months for the same. Earlier, bid of Maytas Infra for Metro Rail seems to had a self-serving side. Maytas has not only foregone the Rs 4000 crore grant from the government but has also assured that it will pay the government Rs 30,000 crore in 30 years.

The bid caught the attention of the Planning Commission, which recommended to the Center that it should not entertain requests for funding Metro Rail projects elsewhere. Now, the group is believed to be looking at expanding the project on two routes not just to make its bid viable but also to get more value for its properties by providing connectivity. Satyam, the parent company of Maytas, owns thousands of acres on the city outskirts which the latter is developing into real estate ventures.

As per sources, the company planned to take the Metro Rail beyond Shilparamam to Sankarpalle on the Line 3 and to Patancheru beyond Miyapur on Line 1. In both the places, Maytas has taken up or has proposed to build mega residential and commercial ventures, including Hill County, spread over hundreds of acres. Sources said the government had agreed to give the company the opportunity to expand routes and therefore additional land.

A clause in the agreement of Kakinada port clearly gives the first right of refusal to the existing developer over future expansion. Similar leverage could be given to Maytas for the Metro. The Hyderabad Metro Rail Corporation is reported to have said there was lot of pressure on the government to extend the Metro Rail route to Patancheru and Alwal. Referring to the argument that metros in the west are making losses, HMRC said the high density of population would ensure revenues. Nine lakh commuters already travel every day on the LB Nagar-Kukatpally stretch. The Maytas proposal would click if 26 lakh passengers travel by 2026.