The Rs 11,420-crore Pune Metro is being readied for its inaugural ride. The 12-km priority stretch of the project with 10 stations is done and dusted. But even before tickets are sold and commuters get to enjoy their first ride in the city, Pune Metro has opened its non-fare revenue account, selling train wrappings and co-branding rights for a couple of stations.
This is a result of foreplanning that took into account the record of other Metro projects in India, which have seen fare revenues fail to cover costs. An earlier study had estimated a revenue gap of Rs 360 crore a year for the Pune Metro, given that it has to pay back Rs 5,800 crore with interest that it has borrowed from overseas development institutions. Since raising fares would have hurt ridership, Pune Metro has set an ambitious target of garnering 50% of its revenues from the non-fare category.
Brijesh Dixit, CMD of the Maharashtra Metro Rail Corporation Limited (Maha Metro), the 50:50 JV between the Centre and the Maharashtra government which is the nodal agency for the project, says the blue print for non-fare revenues was a part of the detailed project report (DPR) prepared for the network. According to him, the highest share of non-fare revenue for a Metro project in the country is around 20% for the Delhi Metro and Pune Metro wants to better that record. A 50% share of revenues from the non-fare category would put Pune in the league of the Hong Kong metro system and Singapore Metro which have done very well on that front.
According to Dixit, the Transit Oriented Development (TOD) segment and an additional cess levied by the municipal corporation would be major sources of non-fare revenue for the Pune Metro. While these would take time, it has made a start with non-land based revenue options. These include advertisements, train wraps and station rebranding. One customer it has found is the Pune-headquartered Bank of Maharashtra, a public sector bank, which has opted for train wrappings. The Pune Metro is offering train wrappings at an annual rate of Rs 25 lakh per wrapping.
Station naming rights too have found takers. While tendering for co-branding rights for a select ten stations for a period of five years has been carried out, two of these stations have been picked up by companies – the Garware College Metro Station will be co-branded with Sahyadri Hospitals for Rs 3.96 crore while the Nal Stop Metro Station will be co-branded with Shree Venkatesh Buildcon Pvt Ltd for Rs 3.35 crore. Tenders for display of advertisements on trains are also out, with the market displaying an appetite to use this space.
According to Prakash Misal, head of the planning department of Pune Metro, the Maharashtra government is levying a 1% additional surcharge on stamp duty, allocating 75% of its proceeds for Metro projects. There will also be additional property development charges for a 500-metre area along the network. Further, the government has put a premium for availing additional FSI, which would be distributed between Maha-Metro and the local planning authority. Land-based revenues are also expected from development of property on PPP mode at the Vanaz and Range Hill Depot and the Swargate and Civil Court stations, with close to 7 mn sq ft of mixed-use real estate space being developed, Misal says.
The first phase of the Pune Metro comprises a 16.58-km Corridor-1 from Pimpri Chinchwad to Swargate with 14 stations and a 14.66-km Corridor-2 from Vanaz to Ramwadi with 16 stations.
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