gmr airports infrastructure ltd share price Directors report

Dear Shareholders,

The Board of Directors present the 27th Annual Report together with the audited financial statements of the Company for the Financial Year (FY) ended March 31, 2023.

Your Company, GMR Airports Infrastructure Limited (formerly known as GMR Infrastructure Limited) ("GIL"), is a leading global infrastructure conglomerate with unparalleled expertise in designing, building, and operating Airports in India and overseas.

The name of the Company has changed from GMR Infrastructure Limited to GMR Airports Infrastructure Limited w.e.f September 15, 2022. Further the Registered Office of the Company has been shifted from Mumbai, Maharashtra to Gurugram, Haryana and consequently the CIN of the Company has changed from "L45203MH1996PL C281138" to "L45203HR1996PLC113564".

GMR Group is the largest private airport operator in Asia and one of the largest globally with current operational passenger handling capacity of more than 100 million annually. The Group operates the iconic Indira Gandhi International Airport at Delhi (Delhi International Airport), which is the largest airport in India. The Group also runs Rajiv Gandhi International Airport at Hyderabad (Hyderabad International Airport), a pioneering greenfield airport known for several technological innovations. The Group is also operating Manohar International Airport, Mopa, Goa (Goa Airport at Mopa) and Bidar Airport in Karnataka. With respect to international airports, the Group is operating the architecturally renowned Mactan Cebu International Airport in Cebu, Philippines, in partnership with Megawide and Aboitiz InfraCapital Inc. Expanding its overseas footprint, GMR Group, in collaboration with Angkasa Pura II (AP II), has started operating Kualanamu International Airport in Medan, Indonesia from July 7, 2022.

The Group is currently developing two major greenfield airport projects in India and Greece, which includes Airport at Bhogapuram in Andhra Pradesh and Airport at Heraklion, Crete, Greece in partnership with GEK Terna. Bhogapuram Airport in India is poised to transform the economy and landscape of the surrounding areas when ready. Crete Airport in Greece will similarly play a significant role in the local economy of the region. Indias aviation market is expected to grow at an average of 7% p.a. till 2040. Further a mature tariff regime for aero revenue is strengthening the Companys ‘Sustainable Cash Flow Profile. GMR Group has Proven track record of strategic partnerships with marquee names like Groupe ADP, Fraport and Malaysia Airports.

As a pioneer in implementing the path breaking Aerotropolis concept in India, GMR Group is developing unique airport cities on commercial lands available around its airports in Delhi, Hyderabad and Goa. GMR

Delhi Aerocity is a landmark business, leisure, and experiential district. Similarly, GMR Hyderabad Aerocity is coming up as a new-age smart business hub.

Performance highlights – FY 2022-23

Performance Highlights of your Company on consolidated basis for the FY 2022-23:

• The Board of Directors of the Company at its meeting held on March 19, 2023 has approved a Composite Scheme of Amalgamation and Arrangement among GMR Airports Limited (GAL) and GMR Infra Developers Limited (GIDL) and the Company and their respective shareholders and creditors, subject to necessary approvals.

• The Company entered into agreement with Groupe ADP to settle the earnout based on achievement of certain milestone (which was to be settled through the Bonus Series B, C and D CCPS) agreed at the time of investment by Groupe ADP in GAL at

Rs. 550 crore as full settlement.

• The Company had issued and allotted 6.76% Unlisted Foreign Currency Convertible Bonds ("FCCB") aggregating Euro 330.817 million equivalent to Rs. 2,931.77 crore to Aeroports De Paris S.A. (Groupe ADP) with a maturity period of 10 year and 1 day.

• Subscription of FCCBs by Groupe ADP and settlement of earnouts will be utilized to repay debt of subsidiaries/ fellow subsidiaries for which GIL had provided security/guarantee.

• During FY 2022-23, the Group has received Rs. 13.9 bn from divestment of stake in Cebu Airport (GMCAC). GMR will continue to operate as the technical service provider until December 2026 and will also be entitled to additional deferred consideration based on the subsequent performance of the airport during the period.

• The Group has entered into a financial partnership with National Investment and Infrastructure Fund (NIIF) for investing equity capital in three airport projects including Mopa (Goa) and Bhogapuram (Visakhapatnam, Andhra Pradesh) airports. Subsequent to the year end, the group has received primary investment of Rs. 6.31 bn from NIIF in the form of Compulsory Convertible Debenture issued by GMR Goa International Airport Limited ("GGIAL").

• Goa Airport at Mopa has achieved COD; Domestic operations commenced from January 5, 2023. Currently, 21 domestic destinations are connected. International operation have also commenced recently in the month of July, 2023. Land monetization process for two hotel plots and retail interchange has been initiated.

• Delhi International Airport Limited ("DIAL") has successfully raised Rs. 10 bn via non-convertible debentures in FY 2022-23 and additionally raised Rs. 12 bn in Q1 FY 2023-24. GMR Hyderabad International Airport Limited ("GHIAL") has also raised Rs. 19.9 bn via non-convertible debentures in FY 2022-23.

• Traffic at GMR operational airports (includes Delhi, Hyderabad, Goa, Cebu and Medan airport) - Domestic and International passenger traffic of airports up by 62% YoY and 163% YoY, respectively.

• Domestic Passenger Traffic at Delhi International Airport during the FY 2022-23 increased by 66% YoY from 32.8 Mn to 49.7 Mn., Domestic Passenger Traffic at Hyderabad International Airport during the FY 2022-23 increased by 69% YoY from 11 Mn to 17.6 Mn.

• Delhi and Hyderabad Internatiional Airports expansion works and Crete Airport construction work is progressing as per schedule.

• Delhi International Airport - Overall progress achieved 86.1% as on March 31, 2023 w.r.t expansion project and new arrival terminal at T1 Part A operationalized in February 2023.

• Hyderabad International Airport - Overall progress achieved 85.1% as on March 31, 2023 w.r.t expansion project. East Pier straight portion commissioned in Q2 FY 2022-23; West Processor (International side) was handed over during Q3 FY 2022-23; West Pier St portion commissioned in Q1 FY 2023-24.

• Land acquisition is at final stages and financial closure is in progress at Bhogapuram Airport. Foundation stone laid by State Chief Minister on May 3, 2023. Tender process for selection of EPC contractor is underway. Pre-cursor to Land handover process; joint survey of land is underway. Financial Closure is underway.

• Honble Supreme Court ("SC") had upheld Bombay High Courts judgement granting concession rights of Nagpur Airport to GMR. Review Petition was filed by MoCA in SC challenging the SC order. However, the petition was dismissed by the SC in its order dated May 09, 2023. However, we await the conclusion of all legal processes and execution of necessary concession agreement.

• Crete airport (Greece) Project is fully funded mainly through state grant which is already received. It is a debt free Project. Overall progress of about 20% was achieved as of March 31, 2023. Terminal building foundation works completed. Work progressing on multiple fronts - departure bridge, roads, water station building and police building etc.

Financial results – FY 2022-23

a) Consolidated financial results

(Rs in crore)

Particulars	March 31, 2023	March 31, 2022
Continuing operations
Income
Revenue from operations	6,693.40	4,600.72
Other income	595.59	358.44
Total Income	7,288.99	4,959.16
Expenses
Revenue share paid/ payable to concessionaire grantors	1,914.72	224.02
Operating and other administrative expenditure	3,054.89	2,274.13
Depreciation and amortization expenses	1,042.44	889.40
Finance costs	2,343.11	2,018.66
Total expenses	8,355.16	5,406.21
Loss before share of net loss of investments accounted for using equity method, exceptional items and tax from continuing operations	(1,066.17)	(447.05)
Share of profit of investments accounted for using equity method	85.97	70.70
Loss before exceptional items and tax from continuing operations	(980.20)	(376.35)
Exceptional items	254.34	(388.26)
Loss before tax from continuing operations	(725.86)	(764.61)
Tax expenses/(income)	114.07	(12.30)
Loss after tax from continuing operations (i)	(839.93)	(752.31)
EBITDA from continuing operations	1,723.79	2,102.57
(Sales/income from operations – Revenue share – operating and other admin expenses)
Discontinued operations
Loss from discontinued operations before tax expenses	-	(318.33)
Tax expenses	-	60.75
Loss after tax from discontinued operations (ii)	-	(379.08)
Total loss after tax for the year (A) (i+ii)	(839.93)	(1,131.39)
Other comprehensive income from continuing operations
Other comprehensive income to be reclassified to profit or loss in subsequent periods:
Exchange differences on translation of foreign operations	(180.07)	(101.29)
Net movement on cash flow hedges	(450.71)	(370.00)
Other comprehensive income not to be reclassified to profit or loss in subsequent periods:
Re-measurement loss on post employment defined benefit plans (net of taxes)	(4.84)	(1.80)
Other comprehensive income for the year from continuing operations, net of tax (B)	(635.62)	(473.09)
Other comprehensive income from discontinued operations
Other comprehensive income to be reclassified to profit or loss in subsequent periods:
Exchange differences on translation of foreign operations	-	17.57
Other comprehensive income not to be reclassified to profit or loss in subsequent periods:
Re-measurement loss on post employment defined benefit plans (net of taxes)	-	(0.57)
Other comprehensive income for the year from discontinued operations, net of tax (C)	-	17.00
Other comprehensive income for the year (D = B + C)	(635.62)	(456.09)
Total comprehensive income for the year, net of tax (A+D)	(1,475.55)	(1,587.48)
Loss for the year attributable to	(839.93)	(1,131.39)
a) Equity holders of the parent	(179.26)	(1,023.29)
b) Non-controlling interests	(660.67)	(108.10)
Total comprehensive income attributable to	(1,475.55)	(1,587.48)
a) Equity holders of the parent	(459.38)	(1,226.89)
b) Non-controlling interests	(1,016.17)	(360.59)
Earnings per equity share (Rs) from continuing operations	(0.30)	(0.98)
Earnings per equity share (Rs) from discontinued operations	-	(0.72)
Earnings per equity share (Rs) from continuing and discontinued operations	(0.30)	(1.70)

The revenue increased by 45.49% from Rs. 4,600.72 crore in FY 2021-22 to Rs. 6,693.40 crore in FY 2022-23 mainly due to an increase in aeronautical, duty free, retails, advertisement, ground handling, hospitality, and parking revenue on account of increase in traffic and business on significant recovery in demand for air travel with removal of restrictions on inter-state and international travel, relaxations by the State Governments, increase in the vaccination drive.

The revenue share paid / payable to concessionaire grantors was lower in FY 2021-22 on account of Annual Fee/ Monthly Annual fee (MAF) waiver. The Group invoked Force Majeure post outbreak of COVID-19 "A Pandemic" as provided under Article 16 of Operation Management and Development Agreement (OMDA) and claimed that it would not be in a position to perform its obligation to prepare Business Plan and pay Annual Fee/ Monthly Annual fee to Airports Authority of India (AAI). However, during FY 2022-23, there is significant improvement in business operations resulting increase in revenue share paid /payable.

b) Standalone financial results

(Rs in crore)

Particulars	March 31, 2023	March 31, 2022
Continuing operations
Revenue from operations	64.47	21.33
Other operating income	37.47	17.73
Other income	24.15	1.00
Operating and other administrative expenditure	120.44	43.97
Depreciation and amortization expenses	0.35	0.91
Finance costs	116.30	78.98
Loss before exceptional items and tax from continuing operations	(111.00)	(83.80)
Exceptional items	120.57	(16.79)
Profit/ (loss) before tax from continuing operations	9.57	(100.59)
Tax expenses	-	58.72
Profit/ (loss) after tax from continuing operations (i)	9.57	(159.31)
Discontinued operations
Loss from discontinued operations before tax expenses	-	(150.47)
Tax expenses	-	-
Loss after tax from discontinued operations (ii)	-	(150.47)
Profit/ (loss) after tax for the year (i+ii)	9.57	(309.78)
Net surplus in the statement of profit and loss - balance as per last financial statements	3,454.49	2,122.60
Re-measurement gains on defined benefit plans (net of taxes)	(0.20)	(0.62)
Transfer from fair valuation through other comprehensive income (‘FVTOCI)	-	1,674.97
Transfer on account of composite scheme of arrangement	-	(32.68)
Surplus available for appropriation	3,463.86	3,454.49
Appropriations	-	-
Net surplus in the statement of profit or loss	3,463.86	3,454.49
Earnings per equity share (Rs) from continuing operations	0.02	(0.26)
Earnings per equity share (Rs) from discontinued operations	-	(0.25)
Earnings per equity share (Rs) from continuing and discontinued operations	0.02	(0.51)

The revenue increased by 160.98% from Rs. 39.06 crore in FY 2021-22 to Rs. 101.94 crore in FY 2022-23 mainly due to an increase in interest income on loan given to Group companies and management services.

Exceptional items comprises reversal/ (provision) for impairment in carrying value of investments, loans/ advances/ other receivables carried at amortised cost (net) There are no material changes or commitments except those already disclosed in this report, affecting the financial position of the company which have occurred between the end of the FY 2022-23 and the date of this report.

Dividend

Your Directors have not recommended any dividend on equity shares for FY 2022-23.

Appropriation to Reserves

The major reserves of the Company on standalone basis for FY 2022-23 and the previous year is as follows:

(Rs in crore)

Particulars	March 31, 2023	March 31, 2022
General reserve	174.56	174.56
Surplus in statement of profit and loss	3,463.86	3,454.49
Capital reserve	141.75	141.75
Foreign currency monetary translation reserve (‘FCMTR)	(33.80)	(20.21)
Fair valuation through other comprehensive income (‘FVTOCI) reserve	17,093.60	6,037.65
Equity component of foreign currency convertible bond (‘FCCB)	479.35	-
Total	21,319.32	9,788.24

Management Discussion and Analysis Report (MDA)

In terms of the provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations"), the Managements Discussion and Analysis is set out in this Annual Report.

State of Affairs of the Company and its Subsidiaries

Brief overview of the developments of the Company and each of the major subsidiaries business is presented below. Further, MDA, forming part of this Report, also brings out review of the business operations of major subsidiaries and jointly controlled entities.

Composite Scheme of Amalgamation and Arrangement

The Board at its meeting held on March 19, 2023, approved the Composite Scheme of Amalgamation and Arrangement amongst GMR Airports Infrastructure Limited ("GIL/Company"), GMR Airports Limited ("GAL"), a subsidiary of the Company and GMR Infra Developers Limited ("GIDL"), a wholly owned subsidiary of the Company and their respective shareholders and creditors ("Scheme"), which, inter-alia, proposes to merge and consolidate the businesses of: (i) GAL into and with GIDL; and (ii) the merged GIDL into and with the Company in each case , on a going concern basis subject to the requisite approval of the shareholders and creditors of the Company, the National Company Law Tribunal ("NCLT"), and other approvals as may be required.

The Company has received the No Observation Letter ("NOC") from the stock exchanges for the Scheme. The NOC from the Reserve Bank of India has also been received for the Scheme.

The proposed Merger has also been approved by the Competition Commission of India ("CCI") under Green Channel route.

Airport Sector

The Companys airport business comprises of six operating airports viz., Delhi International Airport, Hyderabad International Airport, Goa Airport at Mopa & Bidar Airport at Karnataka in India, Mactan Cebu International Airport in Philippines and Kualanamu International Airport in Medan, Indonesia. Further one asset is under construction viz., Crete International Airport in Greece. Also, post signing of the Bhogapuram International Airport (new Vishakhapatnam Airport) concession agreement in June 2020, the Company has been working on various preparatory activities even as the authorities seek clearances to meet their obligations for initiating the construction work. The foundation stone of the project has been laid and joint survey of land is underway.

GMR Group is actively pursuing opportunities for new airports as and when they arise. We are actively tracking the next round of regional airports being privatized by the Government of India. On the international front, in the near future, the Group is strategically focusing on opportunities in South and Southeast Asia and the Middle East. We recently started operations at the brown field Kualanamu International Airport in Medan, Indonesia in a joint venture with Indonesian government entity, Angkasa Pura II. This development will further open a path for us to expand in one of the fastest growing aviation markets, i.e. Indonesia. The Group also continues to legally pursue the right to develop Nagpur Airport.

We also continue to explore opportunities in Africa and Central & Eastern Europe. GMR Airports is looking to drive growth not only through Airport Concessions, but also through provision of airport related services including EPC, Project Management, Engineering & Maintenance, Duty Free, Cargo, other non-aero concessions etc. FY 2022-23 was marked by an impressive post-pandemic traffic recovery. As the COVID waves across the world receded, most of the countries rationalized and then removed travel restrictions. India being a large domestic market, recovered faster than other geographies. By the end of the year FY 2022-23, domestic traffic rose to well above pre-COVID levels. International traffic also exhibited a strong and robust recovery and is expected to surpass pre-COVID levels by FY 2023-24. During this challenging period, both airports and the airlines have evolved to be more operationally flexible to deal with abrupt changes in business scenario and regulations. Given this robust recovery, the sector has seen renewed investments to cope with rising demand.

Various new airlines came up and existing ones started to resume with capacity expansion initiatives.

An overview of the operations at our assets during the year is briefly given below:

Delhi International Airport Limited (DIAL)

DIAL is a subsidiary of the Company and its shareholding comprises of GMR Airports Limited ("GAL") (64%), Airports Authority of India (AAI) (26%) and Fraport AG Frankfurt Airport Services Worldwide (Fraport) (10%). DIAL entered into a long-term agreement to operate, manage and develop the Delhi International Airport.

Highlights of FY 2022-23:

FY 2022-23 was the first fiscal year post onset of Covid-19 where Indian Aviation Sector did not face any major disruptions from Covid-19 and exhibited tremendous recovery in passenger traffic throughout the FY.

During the year we had unrestricted scheduled operation for domestic and international movement. While in FY 2022-23, Delhi International Airport domestic traffic reached pre-COVID level, International traffic recovered to about 88% of pre-COVID level by fiscal year end. Cargo volume recovery was lower and remained below pre-COVID levels in FY 2022-23.

Throughout the year, DIAL proactively engaged with all stakeholders in pushing passenger growth through various passenger experience initiatives. One such major initiative was the launch of DigiYatra which is a path-breaking solution for passenger processing by the use of facial recognition technology.

Operational Performance:

DIAL witnessed significant growth of traffic at Delhi International in FY 2022-23. Passenger traffic at Delhi International was 65.3 mn in FY 2022-23, a growth of 66.1% over previous year with 140.0% growth in international traffic and 51.4% growth in domestic traffic. During the year, Delhi International Airport handled 429,964 Air Traffic Movements (ATMs) and clocked 0.90 MMT cargo volume. Cargo volumes experienced an overall de-growth of 3.1% over previous year, driven by 8.7% de-growth in international cargo. Intermittent lockdown in China, higher inflation in US and Europe and supply chain disruption due to Russia-Ukraine war were key factors which led de-growth in cargo tonnage in the fiscal year. Domestic cargo on the other hand grew by 7.5%.

Honble Minister of Civil Aviation kicked off DigiYatra (a contactless biometric passenger processing platform) at Delhi International Airport on December 01, 2022. DIAL has deployed DigiYatra infrastructure across all the touch points in Terminal 3 & Terminal 2 at Delhi International Airport, New Delhi.

DIALs focus on operational excellence and customer experience backed by a strong organizational culture has helped sustain its leadership position in Airport Service Quality. As a result, DIAL was once again recognized as the Best Airport for service quality in the region by ACI and Best Airport in South Asia by Skytrax. Delhi International Airport has improved its world ranking to 36 and is the only Indian airport among Top 40 airports in the world Skytrax ranking.

Capacity augmentation initiatives of FY 2022-23

Despite operational and logistical challenges thrown by the pandemic during past couple of years, DIAL continued to focus on its expansion plan of airside infrastructure and terminal capacity as per the approved Major Development Plan in order to cater to the future growth in passenger and air traffic. The Phase 3A expansion includes, among others, expansion of Terminal 1 and Terminal 3, construction of a fourth runway along with enhancement of airfields and construction of taxiways, which will expand capacity of Delhi International Airport to 100 Mn passengers annually. Cumulative physical progress on phase 3A expansion as on March 31, 2023 is ~86%. As part of phase 3A, all work related to dual elevated Eastern Cross Taxiways (ECT) and 4th runway have been completed. All balance works are expected to be completed and commissioned during FY 2023-24.

Awards and Accolades of FY 2022-23

• Delhi International Airport has once again emerged as Best Airport in the over 40 million passengers per annum (MPPA) category in Asia Pacific region by ACI in the Airport Service Quality Programme (ASQ) for the 5th time in a row in 2022 rankings.

• In the newest category in ACI ASQ award, DIAL has been bestowed with Cleanest Airport in the Asia Pacific region award

• Delhi International Airport has been voted as Best Airport in India / South Asia for 5th consecutive years in Skytrax ranking.

• In terms of Skytrax world airports ranking, Delhi International Airport jumped from rank 50 in 2020 to 45th in 2021 and further to current rank of 36.

• Delhi International Airport was conferred Best Airport in the country in the ASSOCHAMs 14th International Conference cum Awards on Civil Aviation

Sustainability Focus

DIAL always has a strong focus on Sustainability and has received various awards and accolades in this regard for many years now:

• "Green Airports Recongnition" by ACI- Asia Pacific in 5 years in a row (2023, 2021, 2020, 2019, 2018 and 2017).

• National Award for Excellence in Energy Management from the Confederation of Indian Industry (CII), in the year (2022, 2021, 2020, 2019 and 2018.

• Wings India Environment & Sustainability Award 2022.

• FICCI Water Award in 2022.

• For its operational usage, DIAL is switching to Electric Vehicles from the current conventional vehicles in phase wise manner.

GMR Hyderabad International Airport Limited (GHIAL)

GHIAL is a subsidiary of the Company and its shareholding comprises of GAL (63%), AAI (13%), Government of Telangana (13%) and MAHB (Mauritius) Private Limited (11%) and has a long-term agreement to operate, manage and develop the Hyderabad International Airport.

Highlights of FY 2022-23:

With the effects of COVID-19 decreasing across the globe, India lifted all restrictions on international air travel from the end of March 2022. During the first quarter of FY 2022-23, an increase in COVID-19 cases raised concerns of a 4th Wave but no significant impact was felt on air traffic. No fresh restrictions were imposed by the Government of India which helped air traffic to slowly climb back to near pre-COVID numbers.

The India aviation industry was constrained by the available capacity of aircrafts as airlines had to ground some aircrafts due to maintenance issues arising out of lack of availability of spare parts, partly due to Russia-Ukraine crisis. Also, Pratt & Whitney had not made available the required engines for aircrafts for some of the airlines, which also affected the aircrafts availability. Over 75 aircrafts were grounded in the year, which accounts for 10-12% of Indian fleet. This resulted in demand outstripping the supply of aircrafts and led to increase in ticket pricing and slower growth of traffic. As a result, Domestic traffic was lower as compared with the estimated figures for the year. However, international traffic remained robust and the final total traffic figure for FY 2022-23 was 21.00 million passengers.

Operational Performance:

During the FY, Hyderabad International Airport handled 21.00 million passengers, over 1,60,597 Air Traffic Movements ("ATMs") and more than 1,42,338 Metric Tonnes ("MTs") of Cargo. On a year-on-year basis, passenger movements and ATMs witnessed a growth of 69% and 40%, respectively. Cargo witnessed around 2% YoY growth. By end of the year, Hyderabad International Airport was connected to 66 domestic destinations as compared to pre-COVID level of 55 domestic destinations and 18 international destinations as compared to 16 pre-COVID destinations. A key route addition was the Goa Airport at Mopa. A few domestic routes were lost due to internal issues of the airlines, with some routes being temporarily stopped. Some new international routes which were started during the year:

• Dhaka by IndiGo

• Baghdad by Fly Baghdad

• Don Mueang by Nok Air

The following new airlines commenced operations from Hyderabad during the year:

• Kuwait Airways

• Nok Air

• Fly Baghdad

• Akasa Air

Medical tourism was leveraged to start operations to Dhaka and Baghdad but at the same time destinations like Chicago and Male were stopped due to unviability.

On the Cargo front, Amazon started, for the first time in India, Prime Air (Quikjet) weekly cargo operations from Hyderabad International Airport. Lufthansa resumed its Boeing 77F freighter with routing FRA-BOM-HYD-FRA. During February 2023, Hyderabad hosted the first-ever E-Prix in the country with Hyderabad International Airport playing an integral part in transporting these E-vehicles by operating 6 charter flights carrying them.

Capacity augmentation initiatives FY 2022-23

As part of the expansion works, further progress was made during the year. On airside, various taxiways and passenger boarding bridge (PBB) stands were commissioned. At Passenger Terminal Building (PTB), straight portion of east pier and some levels of west processor were opened for operations. Overall, by March 2023 ~85% of airport expansion works were completed. The balance works are expected to be completed and commissioned by FY 2023-24.

Passenger Experience initiatives FY 2022-23

Continuing with our relentless focus to offer the best possible service quality and passenger experience and achieve world-class levels of operational efficiency, several new milestones were attained during the year.

• Hyderabad International Airport Environment Compliance Oversight Committee was established and organized its first meeting with GHIALs subsidiaries and other stakeholder to discuss environmental compliance status

• Hajj operations re-started post COVID-19

• Soft launch of DigiYatra commenced on August 18, 2022 at Entry and PESC

• 16 AEDs (Automated External Defibrillator) were installed at various locations in PTB on December 25, 2022

• Indias largest Arrival Duty Free store inaugurated at International Arrivals Hyderabad International Airport also focuses on creating and delivering a well-rounded shopping, retail and commercial services experience for the passengers and visitors, which in turn provides a strong and fast-growing source of revenues for the airport. Few such initiatives include:

• Music curation has been done exclusively for Hyderabad International Airport, which plays instrumental music as per different times of the day.

• The check-in hall & all the washrooms in the terminal installed with natural fragrances

• Consultant Chef appointed to enhance the gastronomic experience for passengers/customers at the Airport

• Trials for DigiYatra underway at Hyderabad International Airport

• Trials for real time passenger feedback kiosks has been completed and will be rolled out in FY 2023-24

• Pillar numbering for arrival forecourt was initiated

• Standardised signages at car park, main access road and forecourts in process.

Awards and Accolades

• Ranked 65th at the 2023 Skytrax World Airport Award, winner of:

• Best Regional Airport in India and South Asia

• Best Airport in India and South Asia

• Winner of the 2022 Airport Service Quality (ASQ) Award for Best Airport of 15 to 25 Million Passengers in Asia-Pacific

• Received Platinum Award in 11th National CII POKA YOKE 2022 competition

• Won Gold Recognition at the CII Excellence Summit for its Business Excellence journey

• Winner of the "Airport with the best use of Technology" at ASSOCHAMs 14th Civil Aviation Conference

• Received ACI Worlds ‘Voice of Customer Recognition for the 2nd time in a row in 2022.

Sustainability Focus

GHIAL has always had a strong focus on Sustainability and has received various awards and accolades in this regard for many years now:

• Received the ACI Green Airport recognition 2022 - Silver for the Best Carbon emission Management

• Won the CII National Awards For "National Energy Leader" & "Excellent Energy Efficient Unit" Categories

• ~ 20 vehicles converted to Electric to reduce the Carbon footprint

• >80% conversion to LED lights across the Terminal

• Single-use plastic banned with effect from July 01, 2022

• Opened a biodiesel fuel station

• Set up EV charging stations at the airport

In addition to the above, some of the continuing best environment practices include:

• LEED certified Terminal Building which allows maximum natural lighting, and other features that enable optimal use of energy and water.

• Effective implementation of the "Reduce-Reuse-Recycle" principle in the overall water usage within the airport.

• Efficient rainwater harvesting and ground water recharging processes.

• Efficient solid waste management processes and compost generation to meet 100% internal demands to develop a beautiful landscape within the airport precincts.

• Robust process to effectively reduce aircraft noise & emission levels by collaboratively engaging with airline operators and Air Traffic Service providers to bring in best practices like single engine taxi, Fixed Electrical Ground Power to reduce use of aircraft Auxiliary Power Units (APU), Continuous Descent Approach Operations, etc.

GMR Goa International Airport Limited (GGIAL)

GGIAL declared Commercial Operations Date (COD) on December 07, 2022 and started its domestic commercial operations on January 05, 2023. During the year, GGIAL joined hands with the National Infrastructure Investment Fund (NIIF), who have invested Rs. 631 crores in GMR Goa International Airport Limited in the form of Compulsory Convertible Debentures (CCD).

Post start of operations, the airport achieved 1 million passengers mark on April 30, 2023. The airport currently handles around 75 ATMs per day with peak hour capacity of 13 ATMs. During Q1 of FY 2023-24, the airport handled 968k Domestic Passengers and 6467 ATMs. Further, with necessary approvals from governments and relevant agencies in-place, the airport launched international operations in July 2023. Considering, growing demand from airlines and high passenger footfall, we are already planning expansion in the terminal capacity from the existing 4.4 MPPA to 7.7 MPPA.

Airport Economic Regulatory Authority (AERA) extended the validity of Ad hoc tariff order released in August 2022 till September 2023. The final order for MYTP is expected during Q2 FY 2023-24. The construction works for 6-lane expressway connecting NH 66 to the Airport is in full swing at multiple locations and is likely to be operational by March 2024. Upon completion, the expressway will provide a seamless transition for passengers to and from the airport.

Sustainability Focus

Sustainability as one of core concepts, Goa Airport at Mopa is designed to remain "Green Airport" by design itself. GGIAL has received various awards and accolades in this regard:

• Indian Green Building Council (IGBC) Platinum level Certification for New Building

• "Construction Health, Safety & Environment" Achievement

Award and "Best Construction Project" from Construction Industry Development Council, under Planning Commission, NITI Aayog, GoI during 14th Vishwakarma Awards 2023, New Delhi (April 12, 2023)

• 21st Annual Greentech Safety Award 2023 under ‘Construction Safety category by Greentech Foundation, New Delhi (May 29, 2023)

• ‘Plaque of Excellence in recognition of "Best Environmental Practices" from Goa State Pollution Control Board, GoG on the occasion of World Environment Day, June 05, 2023.

• Various initiatives under our "5 Years Road Map of Carbon Neutrality Level 3+ Program" viz., installation, commissioning of 5 MW onsite solar power generation unit as renewable energy, EV buses and EV ground equipment by ground handling agency, etc.

• Across the entire airport, 100% LED lighting system have been adopted in all Buildings and Airfield Ground Lighting (AGL) systems, facilitating Energy Conservation.

• To reduce Green House Gas (GHG) Emissions from Auxiliary Power Units (APUs) of Aircrafts, Bridge Mounted Equipment (BME) with Fixed electrical ground power (FEGP) & PreConditioned Air Supply (PCA) systems provided.

• Rainwater Harvesting and Ground Water Recharge executed as per approval of Water Resources Department, Government of Goa.

• 100% of treated Sewage Treated Plant (STP) water will be reused for Cooling Tower make-up, toilet flushing through dual plumbing system and irrigation for horticultural purposes making the Airport a Zero Liquid Discharge Unit.

• 500 nos. indigenous trees transplanted within the project site

• About 165 Acre of land with existing tree cover left undisturbed within project site.

• As a part of compensatory tree afforestation plan, 5 Lac Tree Saplings have already been planted in and around the airport project site within Goa State through Goa State Bio-diversity Board (GSBB), GoG.

• ‘Integrated Waste Management Plan (approved by Goa State Pollution Control Board, GoG) in place through dedicated agency and infrastructure.

• Single-use plastic banned with effect from July 01, 2022.

GMR Megawide Cebu Airport Corporation (GMCAC)

GMCAC, a JV between GMR group (40%) and Megawide Corporation (60%), entered into a concession agreement with Mactan Cebu International Airport Authority for development and operation of

Mactan-Cebu International Airport (Cebu Airport) for 25 years. GMCAC took operational responsibility of the airport in November 2014, and has been successfully operating the airport, since then. On December 16, 2022, GMR Group and Megawide Corporation entered into a Deed of Assignment with Aboitiz Infracapital, Inc. (AIC), as a consequence of which, as of December 31, 2022, GMCAC is owned 33 1/3% each by MCC, GMR and AIC. Further, as per the agreement, GMR will continue to operate the airport as a technical services provider till December 2026.

Highlights of FY 2022-23:

The impact of COVID-19 pandemic continued in CY2022 also, but the recovery of traffic has gained momentum. The passenger footfall for CY2022 was recorded at ~5.5 Mn, consisting of 4.8Mn Domestic passengers and ~0.7 Mn International passengers, witnessing a 420% growth from ~1.3Mn overall traffic in CY2021. The total traffic has recovered to 44% of pre-pandemic levels.

In line with our strategy to churn assets and redeploy capital in high growth opportunities, GMR Airports International BV (GAIBV), a stepdown subsidiary of the Company holding stake in GMCAC has entered into a transaction with Aboitiz InfraCapital Inc (AIC) on December 16, 2022, for sale of stake. However, we would continue to remain a 33% shareholder until September 2024 and also operate as a technical services provider to GMCAC until December 2026 and would also be entitled to additional deferred consideration based on the performance of GMCAC for the period between 2023 and 2026. Further details on GMCAC are provided in MDA forming part of this report.

Medan Airport

GMR participated in a bid via GMR Airports Limited and its step-down subsidiaries for managing, developing and improving the performance of Kualanamu International Airport which was held by Angkasa Pura II (APII). GMR was awarded the contract in November 2021 and it entered into a strategic partnership with APII. GMR now holds 49% stake in the project SPV. With the award of this contract, GMR became the first Indian airport operator to win a bid to develop and operate an Indonesian Airport. The SPV took charge of Commercial Operations on July 7, 2022.

Highlights of FY 2022-23:

Medan Airport was able to achieve several notable achievements as well as service improvements. After the takeover, there was a significant increase in the domestic passenger service charge (PSC) by 27% and the international PSC by 16%, leading to a positive financial impact and growth for the airport. In 2022, more than 75% of the routes that were operational in 2019 have been restored, showcasing a successful recovery from the impact of pandemic. Traffic reached 5.9 Mn in CY 2022, which is 72% of the 2019 traffic.

The excellence of Medan Airport was acknowledged when it was shortlisted for the prestigious Routes Asia award. Furthermore, management has been able to attract new routes with Qatar Airways announcing a flight between Qatar and Medan in January 2024 and Batik Air has scheduled direct flights to Chennai in August 2023. These new routes will enhance connectivity and open opportunities for travelers. Airlines have also increased frequencies on the existing routes and new airlines have also started operating on existing routes. In terms of service improvements, Kualanamu International Airport has focused on enhancing the passenger experience. The terminal underwent a thorough deep internal and external cleaning, ensuring a clean and pleasant environment. Targeted improvements were implemented to enhance the Umrah passenger experience, catering to the specific needs of this group. Furthermore, refurbishment of the toll gate and the removal of obsolete infrastructure was carried out, creating additional space and improving overall functionality. Operational improvements have also been prioritized. The airport increased its security staff to enhance the terminals passenger handling capacity and ensure a safe environment. Additional trolley management staff were employed for repairs and regular maintenance, and Critical equipment repairs have been completed, ensuring smooth operations and minimizing disruptions.

Safety and security remain paramount at Kualanamu International Airport. The completion of the Emergency Exercise and Security Exercise, along with mandatory training for ARFF (Aircraft Rescue and Firefighting) personnel reflects the airports commitment to maintaining high safety standards and preparedness in emergencies. Medan Airport is also gearing up for an Immediate Capacity Augmentation phase in 2023. This strategic initiative aims to increase the terminal capacity from the current 10 million passengers to 15 million passengers. The company has recognized the need for expansion due to the growing demand and is in the final stages of securing the funding required to execute this project.

Crete International Airport

GMR Airports and its Greek partner, TERNA, signed a concession agreement with the Greek State for design, construction, financing, operation, maintenance of the new international airport of Heraklion at Crete in Greece. The concession period is 35 years including the design and construction phase of five years. Concession commenced on February 6, 2020. With the award of this contract, GMR became the first Indian airport operator to win a bid to develop and operate a European airport. This is also GMR Groups first foray into the European Union region.

Highlights of FY 2022-23:

Overall construction progress of the airport is ~20 %. During the year, concreting works of the terminal building commenced. Concreting works of Basement slab and lower mezzanine slab of terminal building have been completed, while arrival slab concreting works are in progress. Major part of laying and compaction of base and sub-base for Apron area was completed during the year and lean concrete paving works are in progress. Laying of compaction of Base is progressing well at Runway & Taxiway sites.

The EPC contractor has requested an extension of the construction timeline by 24 months due to changes in design suggested by State Advisors and COVID related delays. The state has approved the extension of COD to February 06, 2027 and has also agreed to fund an additional EPC claim of Euro 104.9 MN.

Airport Adjacencies

GAL has emerged as a strong platform for both India and International concessions. As part of our Airport Platform strategy, we have initiated the journey to build strong portfolios of adjacency businesses under GAL given our experience of more than one and half decade in the Airports services value chain.

We achieved instant success as GAL was awarded the concession for Kannur Duty Free in February 2021, amidst the challenges associated due to the COVID pandemic.

GAL is actively pursuing Non-Aero Master Concession opportunities. Under the Master Concession contract, often various non-Aero services are bundled together including duty free & retail, car park, advertising, F&B and lounges. There has been a noticeable shift at various airports towards the master concession model due to its benefits both to the Airport and the concessionaire and GAL would look to leverage this opportunity.

As a testament to our strong focus and efforts, GAL operationalized various Non-Aero services at Goa Airport at Mopa simultaneously to the commissioning of the Airport. Duty free operations also began along with the International operations in July 2023.

To strengthen its focus on hospitality, GAL formalized an F&B Joint Venture business with Indias leading F&B operator. The joint venture GMR Hospitality Limited (GHL) took over F&B operations at Goa Airport at Mopa.

GAL also acquired the license to develop and operate the cargo terminal services at Goa Airport at Mopa. The state-of-the-art cargo facility will be ready & operationalized by Q2 FY 2023-24 in sync with the beginning of the international operations. GAL initiated the domestic cargo handling and processing through an interim terminal along with the Airports commencement date.

During the year, GAL was awarded the Non-Aero Master Concession of GMR Hyderabad International Airport Limited (‘GHIAL). The concession entails Retail, Duty Free and Retail related services. In addition, we are currently evaluating multiple opportunities in the cargo, duty free and services business across our focus geographies and believe that in the short to medium term we will have more adjacency businesses to add to our overall portfolio. For example, on the International front, GAL was amongst the 13 successful applicants who were qualified for the worlds biggest duty-free tender in Spain.

Airport Land Development (ALD)

FY 2022-23 has been a breakthrough year for ALD with topline revenue from various Airport Land Development Businesses touching Rs. 610 Crore. Several marquee transactions were concluded at both Delhi and Hyderabad. Simultaneously development of key investment projects were initiated, notably DIALs self-development project of a prestigious commercial office development, which was initiated in the year. Given the nature and expanse of ALD works, the team has developed capability in all streams of the project development cycle. The sale transaction of Amazon warehousing assets at Aerocity Hyderabad has demonstrated ALDs capability to recycle capital and has established the important precedence that leased land can also be monetized.

Aerocity Delhi

On the transaction side, DIAL completed the international competitive bidding process and awarded to Chalet Hotels Limited (CHL) the right to develop a Hotel at the Terminal-3 of Delhi International Airport. CHL is an owner, developer, and asset manager of high-end hotels in key metro cities of India and is also listed on Indian stock exchanges. The upcoming terminal hotel will have 350-400 rooms along with other amenities matching standards of international airport terminal hotels. The transaction has been done through an innovative structure whereby DIAL shall develop and deliver the cold shell and CHL shall complete the interiors and other fit outs and operate the Hotel while paying Revenue Share to DIAL subject to a Minimum Guaranteed License Fees. The hotel is expected to be commissioned by FY 2025-26.

During FY 2022-23, as a significant step towards creating portfolio of investment projects, DIAL initiated the development of a commercial building of approx. 6 Lakh sft. gross leasable area in the Gateway District of Aerocity. The proposed building is envisaged as a Ground

+ 6 floors building and will have 3 basements. The commercial building will host multi-tenanted offices, corporate amenities and ancillary retail and F&B. The building is expected to be completed in FY 2025-26. Construction works were initiated in the month of March 2023.

In addition, Airbus awarded the EPC contract to GAL for construction of their headquarters and training center at the Terminal District, Near MLCP, Opposite Terminal -3 in May 2022. The facility will be built on a 1.1 acre land parcel and is expected to be completed in 15 months.

Further, pre-construction activities including design & planning commenced for the various construction projects including Terminal Hotel, GA Annex, which are proposed to be undertaken during FY 2022-23 and FY 2023-24.

The infrastructure development works at the two new districts –Gateway & Downtown Districts of Aerocity Delhi have also gathered momentum as the development works for the Office & Integrated Retail developments being done by Bharti Realty led consortiums are progressing.

In the existing operational Hospitality District, the activation of the GMR Square was fully revived post pandemic with continued focus on the digital marketing including Aerocity Live magazine, Social media handles on Facebook, LinkedIn and Instagram. Additionally new Retail areas with best-in class Indian brands were added to GMR Square to add to the world class experience offered for global and domestic visitors to GMR Aerocity.

Aerocity Delhi operations received ISO certification for environment and energy management in FY 2022-23.

Aerocity Hyderabad

The year under review has been a successful year for Hyderabad ALD. Notable transactions, both land lease and Build To Suit (BTS), were executed.

As a testament to ALDs capability in recycling of capital deployed on projects, the sale transaction of Amazon warehousing facilities was concluded with CPPIB backed Indospace Core Ventures. The transaction generated value of Rs. 188 crore. The on-ground handover of the facilities is expected to close in Q1 FY 2023-24.

GMR Hyderabad Aerospace & SEZ Ltd (GHASL) leased 7.18 acres land in the non-processing area of the SEZ to M/s Amara Raja Batteries Ltd for setting up a Research and Development Innovation Centre. GHASL also executed Agreement To Lease (ATL) with Schneider Electric Pvt. Ltd (SEPL) for Lease of Build to Suit facility of approx. 3,80,000 sqft in two phases on approx. 18 acres of land; Phase 1 is approx. 2,10,000 sqft and Phase 2 is 1,70,000 sqft. The ATL executed by GHASL with Skyroot Aerospace was amended revising the area of the BTS facility for assembly of small satellite launch vehicles from 24,000 sqft to 56,000 sqft and facility will be handed over in Q2 FY 2023-24. Safran announced the setting up of Engine MRO in the SEZ land on 23.5 acres and signed land lease agreement with GHASL. In line with its strategy to build businesses at GAL, it has been targeting EPC business for ALD related projects within the group. Accordingly, GAL was awarded the Design & Build Contract from GHASL for the construction of the Schneider facility at an award value of Rs. 49 Crore. GAL was also awarded the EPC contract for the Safran MRO facility at an award value of Rs. 236 crore. The EPC contract in GAL for 1 million sqft of warehousing facility with ESR GMR Logistics Park Pvt. Ltd (GLPPL) with contract value of Rs. 265 crores was completed and handed over in Q4 FY 2022-23.

Safran Aircraft Engines project received Industrial Project of the Year Award at Realty Plus South Conclave 2022. This project also received Edge Certification from IFC for inclusion of Green Building elements in design and construction.

GMR Hyderabad Aerotropolis Ltd (GHAL) executed lease deed with Amity for the lease of 20 acres land for setting up University at Aerocity Hyderabad. Substantial leasing of Tower-2 was completed with renowned tenants including HDFC Bank, Speed Infra, Skycell, APFT and SGD Pharma. Food Court at Tower 2 also commenced operations. The destination Retail project i.e. Interchange saw pre-leasing LOIs signed with RBL bank, Best Sellers, Specta Eyewear, Third Culture Care, Kamal Watch Co, Punjab Grill etc.

FY 2022-23 also marked a breakthrough year for the Novotel Hotel with its highest ever top line of Rs. 85 Crores despite being under renovation.

In addition to above mentioned major transactions, we continue to strengthen the AeroCity Hyderabad Brand further with effective Social Media marketing through purely organic efforts. We have already achieved 4000+ B2B followers on LinkedIn.

Aerocity Goa

ALD submitted the City Side Development Plan to Government of Goa for approval. Terminal District comprising of approx. 23 acres has been identified as the first target area for monetization and will comprise of hotel, convention centre and retail areas. The first set of monetization for hotel development on 2 plots is expected to take place during first half of FY 2023-24.

Raxa Security Services Limited (RAXA)

Raxa, a pioneer in providing security services, with ISO 9001:2015, ISO 18788:2015, ISO 29993:2017 and ISO 45001:2018 certifications, is the security arm of GMR Group. Raxa was established in the year 2005 to take care of the security of the assets of national importance that the Group has created. Since 2011, apart from providing security to GMR Group assets, the company has also been providing its service to other reputed external clients. Its portfolio of clients includes renowned companies in Aviation, Manufacturing, Pharmaceutical, IT, Hospitality & Educational sectors as well as Government establishments.

Currently, Raxa employs more than 8,000 security personnel. During the year, Raxa bagged contracts from a large number of premier clients.

Raxa is undoubtedly the only private security company in India that provides high-level security training and has a 5S certified State-of-the-Art training center, called Raxa Academy, spread over a 100-acre campus. The Academy is affiliated to MEPSC (Management & Entrepreneurship and Professional Skills Council) under the NSDC / Ministry of Skill Development and Entrepreneurship and has been accorded the recognition of "Centre of Excellence" in the security sector by MEPSC. It is a center for higher learning in security and safety and provides both short-term and long-term specialized training for various levels.

Raxa Academy has successfully implemented the Learning Management System for running online courses. During the year, it has started an industry focused Drone Pilot Training course. It also conducted several short duration thematic security courses, including its flagship Corporate Security and Advanced Management Course for senior security professionals as well as Leadership Course. More than providing man-guarding solutions, Raxa is well known in the industry for its technical security solutions. Raxas Technical Division provides integrated technical security solutions with the latest proven technologies either independently or in association with its specialist technology partners. The scope of the solutions includes Access Control, CCTV surveillance, Fire Alarm & Public Address system, Perimeter Intrusion Detection System, Anti-sabotage and Anti-terrorism measures, Command & Control Centers, etc.

Raxa has recently established a dedicated cyber division to provide digital security, in addition to physical security. It is the only security company in India that can provide the entire range of security solutions from physical to electronic to cyber security. Together with its highly acclaimed partners, it offers a wide range of cyber solutions. Leveraging from the expertise of GMR group in aviation and the inherent strength of Raxa in providing security solutions, Raxa has formed a dedicated consultancy division to provide consultancy services, particularly in the aviation sector.

During the year, Raxa has entered into partnership with several specialized technical/ cyber/ Drone security solution providers such as Redinent, Sectona (Cyber) and Skyvenger (Drone business), NASSCOMM, DSCI, Sectona for Cyber solutions to further enhance its security capabilities. It has also established a dedicated fire division to offer end-to-end fire-fighting solutions.

Consolidated Financial Statements

In accordance with the Companies Act, 2013 and Ind AS 110 -Consolidated Financial Statements read with Ind AS 28 –Investments in Associates and Joint Ventures, the audited consolidated financial statements are provided in the Annual Report.

Holding, Subsidiaries, Associate Companies and Joint Ventures

As on March 31, 2023, the Company has 26 subsidiary companies and 14 associate companies including joint ventures. During the year under review, GMR Hospitality Limited became the subsidiary of the Company. Further, during the year, Globemerchants Inc. became the associate and SSP- Mactan Cebu Corporation (SMCC) and Mactan Travel Retail Group Co. ceased to be associates of the Company.

However after the closure FY 2022-23, GMR Hyderabad Airport

Assets Limited ceased to be the subsidiary of the Company. The complete list of subsidiary companies and associate companies (including joint ventures) as on March 31, 2023 in terms of the Companies Act, 2013 is provided as "Annexure A" to this Report. The Policy for determining material subsidiaries may be accessed on the Companys website at the link: https://investor.gmrinfra.com/pdf/4_Policy_on_Material_subsidiaries.pdf. Report on the highlights of performance of subsidiaries, associates and joint ventures and their contribution to the overall performance of the Company has been provided in Form AOC-1 as "Annexure- B" to this Report and therefore not reported here to avoid duplication.

The financial statements of the subsidiary companies have also been placed on the website of the Company at https://investor.gmrinfra.com/annual-account-of-subsidaries

Directors Responsibility Statement

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(5) of the Companies Act, 2013: a) that in the preparation of the annual accounts for the year ended March 31, 2023, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any; b) that such accounting policies as mentioned in Note no. 2 of the Notes to the Financial Statements have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2023 and of the profit of the Company for the year ended on that date; c) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; d) that the annual accounts have been prepared on a going concern basis; e) that proper internal financial controls to be followed by the Company have been laid down and that the financial controls are adequate and are operating effectively; f) that proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

Corporate Governance

The Company continues to follow the Business Excellence framework, based on world class Malcolm Baldrige Framework for Performance Excellence which was adopted by GMR Group in the year 2010. With over a decade now, the deployment of the GBEM framework has taken roots in over 15+ Group Businesses. Various Continuous Improvement and Break-Through Innovation initiatives under the umbrella of GBEM have yielded tremendous benefits to various Group Companies in terms of Cost Savings and new avenues for revenue generation. The key initiatives like 5S, Kaizens, Idea Factory, CIPs [Continuous Improvement Projects] and regular BE Assessments have been implemented with lot of rigor and enthusiasm. A Governance Structure is in place along with timely Rewards and Recognitions to GMRites contributing to these initiatives, has helped to grow and sustain these initiatives. Your Company works towards continuous improvement in governance practices and processes, in compliance with the statutory requirements.

The Report on Corporate Governance as stipulated under relevant provisions of SEBI LODR forms part of this Annual Report. The requisite Certificate from the Practicing Company Secretary confirming compliance with the conditions of Corporate Governance is attached to the said Report.

Business Responsibility and Sustainability Report

As stipulated under Regulation 34(2)(f) of SEBI LODR, read with Circular No. SEBI/HO/CFD/CMD-2/P/CIR/2021/562 dated May 10, 2021 issued by the Securities and Exchange Board of India (SEBI) the Business Responsibility and Sustainability Report describing the initiatives taken by the Company from Environmental, Social and Governance perspective is attached as part of the Annual Report.

Contracts and arrangements with Related Parties

All contracts / arrangements / transactions entered by the Company during the FY 2022-23 with related parties referred in Section 188(1) of the Companies Act, 2013 were in the ordinary course of business and on arms length basis. During the year, the Company had not entered into any contract / arrangement / transaction with related parties referred in Section 188(1) of the Companies Act, 2013 which could be considered material in accordance with the policy of the Company on materiality of related party transactions. Since all the related party transactions were in ordinary course of business and at arms length basis, Form AOC-2 is not applicable.

The Policy on related party transactions as approved by the Board may be accessed on the Companys website at the link: https:// investor.gmrinfra.com/pdf/Revised GIL_Policy on Related Party Transaction-wef Feb 09, 2022-uploaded on website.pdf. Your Directors draw attention of the members to Note no. 31 to the standalone financial statement which sets out related party disclosures.

Corporate Social Responsibility (CSR)

The Corporate Social Responsibility Policy (CSR Policy), of the Company indicating the activities to be undertaken by the Company, may be accessed on the Companys website at the link: https://investor.gmrinfra.com/pdf/Amendment to CSR POLICY-GIL(9.08.pdf .

The details of the CSR Committee are provided in the Corporate Governance Report which forms part of this Annual Report The Company has identified the following focus areas towards the community service / CSR activities, which inter alia include:

• Education

• Health, Hygiene & Sanitation

• Empowerment & Livelihoods

• Community Development

The Company, as per the approved policy, may undertake other need- based initiatives in compliance with Schedule VII to the Companies Act, 2013. During the year under review, the Company was not required to spend any amount on CSR as it did not have any profits. Accordingly, it has not spent any amount on CSR activities. However, the Company, through its subsidiaries/ associate companies, spent an amount of Rs. 18.47 Crores during the year on CSR activities. The details of such activities carried out with the support of GMR Varalakshmi Foundation (GMRVF), Corporate Social Responsibility arm of the GMR Group, have been highlighted in Management Discussion and Analysis. The Annual Report on CSR activities is annexed as "Annexure C" to this Report.

Risk Management and Environmental Social and Governance (ESG) journey

The Board of Directors of the Company has a Risk Management Committee which is responsible for monitoring and reviewing the risk management plan and ensuring its effectiveness. The Audit Committee has an additional oversight in the area of financial risks and controls. In addition, the updates on Enterprise Risk Management (ERM) activities are shared on a regular basis with Management Assurance Group (MAG), the Internal Audit function of the Group.

The Company has in place the Risk Management Policy duly approved by the Board of Directors designed to identify, assess and mitigate risks appropriately.

Currently, in opinion of the Board, there are no risks that threaten the existence of the Company. However, details of the risk concerns, threats Identification, assessment, profiling, treatment and monitoring including ESG concerns are covered in MDA section, which forms part of this Report.

Internal Financial Controls

The Company has put in place policies and procedures including the design, implementation and monitoring of internal controls over its operations to ensure orderly and efficient conduct of its businesses, including adherence to Companys policies and procedures, safeguarding of assets, prevention and detection of fraud, accuracy and completeness of accounting records and timely preparation of reliable financial disclosures under the Companies Act, 2013.

These controls and processes have been embedded and integrated with SAP and / or other allied IT applications which have been implemented. During the year under review, these controls were reviewed and tested by the Management Assurance Group of the Company. The Statutory Auditors of the Company have also tested the Internal Controls over financial reporting.

There were no reportable material weaknesses observed in the design or operating effectiveness of the controls except in few areas, where the risk has been identified as low and there is a need to further strengthen the controls. Corrective and preventive actions, as appropriate are taken by the respective functions.

Directors and Key Managerial Personnel

During the year under review, Mr. Madhva B. Terdal upon completion of his tenure on August 07, 2022, ceased to be a whole-time Director of the Company and continues to serve as a Non-executive & Non-Independent Director of the Company. There were no other changes in the Directors and Key Managerial Personnel of the Company during the year.

In accordance with the provisions of the Companies Act, 2013, the Articles of Association of the Company, Mr. Srinivas Bommidala and Mr. G.B.S Raju, Directors, retire by rotation at the ensuing Annual General Meeting of the Company and being eligible have offered themselves for re-appointment. The Nomination and Remuneration Committee ("NRC") and the Board on the basis of performance evaluation, recommend the re-appointment of Mr. Srinivas Bommidala and Mr. G.B.S Raju as Directors of the Company, liable to retire by rotation.

The Board of Directors at its meeting held on August 14, 2023 had based on the recommendation of the NRC and considering the remarkable contribution of Mr. G.M. Rao in growth of the GMR Group and also considering that it is crucial for the Company to have Mr. G.M. Rao on the Board, had recommended for approval of the shareholders, the continuation of Mr. G.M. Rao as a Director of the Company post attaining the age of 75 years in terms of requirement of Regulation 17(1A) of the SEBI LODR. Mr. G.M. Rao is the founder of the GMR Group. Over the last 4 decades, he has successfully established GMR Group, as one of the most recognized brands in the country.

In view of his leadership, strategic inputs, management skills, stakeholders relationships, governance acumen as well as operational guidance towards the growth of the Company, The Board is of opinion that it is crucial for the Company to have him on the Board.

The brief resumes and other details relating to the directors who are proposed to be appointed/ re-appointed, as required to be disclosed as per the provisions of the SEBI Listing Regulations/Secretarial Standard are given in the Annexure to the Notice of the 27th AGM.

Board Evaluation

Annual performance evaluation of the Board, its Committees and Individual Directors pursuant to the provisions of the Companies Act, 2013 and the corporate governance requirements under SEBI LODR have been carried out. The performance of the Board and its committees was evaluated based on the criteria like composition and structure, effectiveness of processes, information and functioning etc.

The Board and the Nomination and Remuneration Committee reviewed the performance of the Individual Directors on the criteria such as contribution of the Individual Directors to the Board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. In addition, the Chairman was also evaluated on the key aspects of his role.

A senior non-independent Director of the Company also had a one-on-one interaction with the Independent Directors to have further insight on the governance aspects and effectiveness of the Board process.

The Independent Directors at their separate meeting held during the year had also reviewed the performance of the Non-Independent Directors, Chairman and the Board as a whole.

Policy on Directors Appointment and Remuneration

The Company has devised a Nomination and Remuneration Policy ("NRC Policy") which inter alia sets out the guiding principles for identifying and ascertaining the integrity, qualification, expertise and experience of the person for the appointment as Director, Key Managerial Personnel (KMP) and Senior Management Personnel. The NRC Policy further sets out guiding principles for the Nomination and Remuneration Committee for determining and recommending to the Board the remuneration of Managerial Personnel, KMP and Senior Management Personnel. There has been no change in the NRC Policy during the year.

The Companys NRC Policy for Directors, Key Managerial Personnel and Senior Management is available on the Company website at https://investor.gmrinfra.com/pdf/1_Nomination_Remuneration_Policy.pdf.

In recognition of the importance of having a diverse Board toward success of the organization, the Company has adopted the Board Diversity Policy. The Policy provides for having an appropriate blend of functional and industry experts on the Board, diversity in terms of cultural backgrounds, gender and skillset etc.

Declaration of Independence

The Company has received necessary declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed both under Section 149(6) of the Companies Act, 2013 ("Act") and Regulation 16 of SEBI LODR and there has been no change in the circumstances affecting their status as Independent Directors of the Company. The Company has also received a declaration from all the Independent Directors that they have registered their names in the Independent Directors Data Bank.

Further, the Independent Directors have confirmed that they have complied with the Code for Independent Directors prescribed in Schedule IV to the Act and also complied with the Code of Conduct for Directors and Senior Management Personnel, formulated by the Company.

Auditors and Auditors Report Statutory Auditors

M/s Walker Chandiok & Co. LLP, Registration No. (001076N/ N500013), were appointed as Statutory Auditors of the Company for a term of 5 (five) years from the conclusion of the 23rd Annual General Meeting (AGM) held on September 16, 2019, till the conclusion of the 28th Annual General Meeting of the Company. The Auditors Report does not contain any qualification, reservation, adverse remark. The notes on financial statement referred in Auditors Report are self -explanatory and do not call for further comment.

Pursuant to provisions of Section 143(12) of the Companies Act, 2013, neither the Statutory Auditors nor Secretarial Auditors have reported any incident of fraud to the Audit Committee or Board during the period under review.

Cost Auditors

Maintenance of cost records and requirement of cost audit as prescirbed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable to the business activities carried out by the Company.

Secretarial Auditors

The Board had appointed M/s. V. Sreedharan & Associates, Company Secretaries in Practice, to conduct Secretarial Audit for the FY 2022-23. The Secretarial Audit Report of the Company as prescribed under Section 204 of the Companies Act, 2013 read with Regulation 24A of the Listing Regulations, for the FY ended March 31, 2023 is annexed herewith as "Annexure D" to this Report. The Secretarial Audit report does not contain any qualification, reservation or adverse remarks.

Further, the Secretarial Audit reports of material unlisted subsidiaries of the Company incorporated in India, as required under Regulation 24A of the SEBI LODR for the FY ended March 31, 2023 have been annexed as "Annexure D-1 to D-4".

It may be noted that based on the audited financial statements of the Company as on March 31, 2023, the Company has only 4 material subsidiaries i.e. GMR Airports Limited, Delhi International Airport Limited, GMR Hyderabad International Airport Limited and Delhi Duty Free Services Private Limited during the year under review.

Secretarial Standards

The Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India.

Disclosures: CSR Committee

The CSR Committee comprises Dr. Emandi Sankara Rao as Chairman, Mr. B.V.N. Rao and Mr. Sadhu Ram Bansal as members.

Audit Committee

The Audit Committee comprises of Mr. Subba Rao Amarthaluru as Chairman, Dr. Emandi Sankara Rao, Dr. Mundayat Ramachandran, Mr. Sadhu Ram Bansal, as members.

All the recommendations made by the Audit Committee were accepted by the Board during the year.

Further details on the above committees and other committees of the Board are given in the Corporate Governance Report.

Vigil Mechanism

The Company has a Whistle Blower Policy, which provides a platform to disclose information regarding any purported malpractice, fraud, impropriety, abuse or wrongdoing within the Company, confidentially and without fear of reprisal or victimization. Your Company has adopted a whistleblowing process as a channel for receiving and redressing complaints from employees, directors and third parties, as per the provisions of the Companies Act, 2013, SEBI LODR and Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015. The details of the Whistle Blower Policy are provided in the Corporate Governance Report and also hosted on the website of the Company https://investor.gmrinfra.com/pdf/GMR_Policy_Whistle_Blower.pdf.

Number of Meetings of the Board

A calendar of Board Meetings is prepared and circulated in advance to the Directors. During the year under review, Seven (7) Board Meetings were held, the details of which are given in the Corporate Governance Report that forms part of this Annual Report. The intervening gap between two consecutive board meetings was within the period prescribed under the Companies Act, 2013 and SEBI LODR.

Particulars of Loans, Guarantees and Investments

A statement regarding Loans/ Guarantees given and Investments made covered under the provisions of Section 186 of the Companies Act, 2013 is made in the notes to the Financial Statements.

Conservation of energy, technology absorption and foreign exchange earnings and outgo

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of The Companies (Accounts) Rules, 2014, is provided in "Annexure E" to this report.

Annual Return

Pursuant to Section 134 and Section 92(3) of the Companies Act, 2013, as amended, draft of the Annual Return for the FY 2022-23 has been placed on the Company website at https://investor.gmrinfra.com/annual-reports .

Particulars of Employees and related disclosures

The information required under Section 197(12) of the Companies Act, 2013 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (including amendments thereto), is attached as "Annexure F" to this Report. The information required under Rule 5(2) and (3) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (including amendments thereof), is provided in the Annexure forming part of this Report. In terms of the first proviso to Section 136 of the Companies Act, 2013, the Report and Accounts are being sent to the members excluding the aforesaid Annexure. Any member interested in obtaining the same may write to the Company Secretary at the Registered Office of the Company.

Dividend Distribution Policy

The Board has adopted Dividend Distribution Policy in terms of Regulation 43A of SEBI LODR. The Dividend Distribution Policy is disclosed on the website of the Company at the link: https:// investor.gmrinfra.com/pdf/GMR_Dividend_Distribution_Policy.pdf.

Developments in Human Resources and Organization Development

The Company has robust process of human resources development which is described in detail in Management Discussion and Analysis section under the heading "Developments in Human Resources and Organization Development at GMR Group".

Changes in Share capital

During the year under review, there is no change in the Authorized share capital of the Company and it stood at 1455,00,00,000/-divided into 1355,00,00,000 equity shares of Rs. 1/- (Rupee one only) each and 10,00,000 (Ten lakhs) preference shares of Rs. 1,000/-(Rupees One Thousand only) each.

There was no change in the issued and paid-up share capital of the Company.

Debentures

During the year under review, the Company has not issued any debentures.

Foreign Currency Convertible Bonds

Pursuant to the approval of the shareholders of the Company granted at the 26th Annual General Meeting held on September 27, 2022, the Board of Directors at its meeting held on March 17, 2023, had approved issuance of 3,30,817 Foreign Currency Convertible Bonds ("FCCBs) of face value Euro 1,000 each aggregating to Euro 330.817 million equivalent to Rs. 2,931.77 crore to Aeroports De Paris S.A. ("ADP"), subject to necessary regulatory approval. Upon receipt of necessary regulatory approval, the Management Committee of the Board had on March 24, 2023 allotted 3,30,817 FCCBs of face value of Euro 1,000 each aggregating to Euro 330.817 million to ADP ("FCCB Holder") with a maturity period of 10 years and 1 day. The FCCBs carry an interest rate of 6.76% p.a. on a simple interest basis. Interest will accrue on a yearly basis and first interest instalment is payable on date of expiry of five years and subsequently every year thereafter.

The FCCB holder can exercise the conversion option at any time on or after the day following the 5th anniversary of the Closing Date i.e. March 24, 2023. The price at which each of the Shares will be issued upon conversion will initially be Rs. 43.67 (calculated by reference to a premium of 10% ) over and above the Regulatory Floor Price of

Rs. 39.70 per share) but will be subject to adjustment as per the terms of FCCBs. The principle amount of FCCBs together with any accrued but uncapitalised or unpaid interest upto the date of conversion may be converted into Equity Shares of the company. The principle amount of FCCBs, if converted would have accounted for 67,06,00,981 equity shares of the Company.

Further the outstanding FCCBs aggregating to US$ 25 million issued to Kuwait Investment Authority (KIA) shall account for 111,24,16,667 equity shares of the Company (as per original entitlement) if converted.

Environment Protection and Sustainability

Since inception, sustainability has remained at the core of our business strategy. Besides economic performance, safe operations, environment conservation and social well-being have always been at the core of our philosophy of sustainable business. The details of initiatives/ activities on environment protection and sustainability are described in Business Responsibility and Sustainability Report forming part of this Annual Report. The Company is also publishing Sustainability Report which is available on the website of the Company at www.gmrinfra.com

Change in the Name and Registered office of the Company

Pursuant to Special Resolution passed on August 27, 2022 by way of Postal Ballot, the name of the Company was changed from GMR Infrastructure Limited to "GMR Airports Infrastructure Limited" w.e.f September 15, 2022.

The Shareholders of the Company at the 26th Annual General Meeting held on September 27, 2022 had approved shifting of Registered Office of the Company from the State of Maharashtra to the State of Haryana, subject to the approval of the Central Government (Power delegated to Regional Director). Pursuant to receipt of the approval for shifting of Registered Office from the Regional Director, Western Region, the Board of Directors had approved the situation of the new Registered Office at Gurugram, Haryana with effect from June 22, 2023. Consequent to shifting of Registered Office the CIN of the Company has also changed to "L45203HR1996PLC113564"

Change in the nature of business, if any

There are no changes in the nature of business of the Company.

Significant and Material Orders passed by the Regulators

There are no significant and material orders passed by the Regulators or courts or tribunals impacting the going concern status and Companys operations in future.

Deposits

During the year under review, the Company has not accepted any deposit from the public. There are no unclaimed deposits/ unclaimed/ unpaid interest, refunds due to the deposit holders or to be deposited to the Investor Education and Protection Fund as on March 31, 2023.

Compliance by Large Corporates:

Your Company does not fall under the Category of Large

Corporates as defined under SEBI vide its Circular SEBI/HO/DDHS/ CIR/P/2018/144 dated November 26, 2018, as such no disclosure is required in this regard.

Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

Your Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Complaints Committee (ICC) has been set up to address complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this Policy.

There were no sexual harassment complaint pending or received during the year ended March 31, 2023.

Proceeding under Insolvency and Bankruptcy Code and Onetime settlement a) There are no proceedings initiated/pending against your Company under the Insolvency and Bankruptcy Code, 2016 which materially impact the business of the Company. b) During the year under review, the Company has not made any one-time settlement Other than the matters disclosed in this Report, there are no other events or transactions during the year that require disclosures to be made in terms of the provisions of Companies Act, 2013.

Acknowledgements

Your Directors thank the lenders, banks, financial institutions, business associates, joint venture partners and other stakeholders, Government of India, State Governments in India, regulatory and statutory authorities, shareholders and the society at large for their valuable support and co-operation. Your Directors also thank the employees of the Company and its subsidiaries for their continued contribution, commitment and dedication.

	For and on behalf of the Board
	GMR Airports Infrastructure Limited
	(Formerly known as GMR Infrastructure Limited)
	G. M. Rao
Place: New Delhi	Chairman
Date: August 14, 2023	(DIN: 00574243)