The five bundles are Amritsar-Kangra, Varanasi-Gaya-Kushinagar, Bhubaneswar-Hubballi, Raipur-Aurangabad and Tiruchirappalli-Tirupati
Private concessionaires are expected to invest around ₹8,622 crore across 11 Airports Authority of India (AAI) airports proposed to be leased out in five bundles, documents reviewed by businessline showed.On August 23, businessline reported that the Public Private Partnership Appraisal Committee (PPPAC) had given in-principle approval to the five bundled concessions.The five bundles are Amritsar-Kangra, Varanasi-Gaya-Kushinagar, Bhubaneswar-Hubballi, Raipur-Aurangabad and Tiruchirappalli-Tirupati. The Ministry of Civil Aviation (MoCA) will now undertake market sounding with potential infrastructure players before incorporating feedback into the proposal and submitting it to PPPAC for its final recommendation.Investment BreakdownThe Bhubaneswar-Hubballi bundle has the highest estimated investment requirement at ₹2,725 crore, followed by Varanasi-Gaya-Kushinagar at ₹2,467 crore.Raipur-Aurangabad has an estimated investment requirement of ₹1,496 crore, while Tiruchirappalli-Tirupati and Amritsar-Kangra have requirements of ₹1,411 crore and ₹523 crore respectively.Meanwhile, the Centre has estimated equity returns of up to 18.6 per cent for the five proposed airport bundles.The Varanasi-Gaya-Kushinagar bundle has the highest projected equity internal rate of return (EIRR) at 18.6 per cent, with its project internal rate of return (PIRR) estimated at 12 per cent.In addition, the projected EIRR for Amritsar-Kangra stands at 17.5 per cent, while its PIRR is estimated at 11.5 per cent.For Tiruchirappalli-Tirupati, the EIRR and PIRR have been estimated at 16.7 per cent and 10.7 per cent respectively.Likewise, Bhubaneswar-Hubballi has a projected EIRR of 16.4 per cent and PIRR of 11.9 per cent, while Raipur-Aurangabad has an EIRR of 16.7 per cent and PIRR of 11.6 per cent, according to the documents.Airport BundlesBesides, the proposed concession structure envisages making city-side land available to private concessionaires to enhance the financial viability of the respective airport bundles.The portion of land to be made available at each airport, along with the permissible scope and nature of city-side development, will be specified in the bid documents and the Draft Concession Agreement, the documents showed.As per the document, the proposed revenue streams will include aeronautical, non-aeronautical and city-side development revenues.Furthermore, aeronautical revenues include landing, housing and parking charges, cargo, ground handling, fuel throughput and User Development Fee. On the other hand, non-aeronautical revenues include duty-free, food and beverage, retail, car parking, car rental and reservations, advertising and miscellaneous revenue.Revenue SourcesAdditionally, city-side development, including real estate, has been identified as a potential revenue source under the proposed structure.The document further showed that the five-bundle structure emerged after a wider assessment undertaken by AAI.AAI had initially assessed 12 major airports based on passenger traffic, land availability, commercial potential, financial performance and airport-specific strengths and constraints.It subsequently evaluated 136 smaller airports for possible bundling with the major airports, considering parameters including traffic potential, capital expenditure requirements, geographical proximity, city-side development potential and financial viability.Following multiple rounds of filtering and assessment of alternative major-small airport combinations, the AAI Board approved a proposal comprising five major airports bundled with six smaller airports.Published on August 24, 2026
