DMRC a great revenue model

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New Delhi, Jul 20: An ASSOCHAM study projected earnings of Delhi Metro Rail Corporation (DMRC) to go up nearly 200 per cent to a whopping Rs 2,100 crore by 2011, with the revenue streams being generated by traffic of the order of Rs 700 crore and additional incomes being garnered by letting out space for advertising, ATMs, and restaurants.

According to an Assocham Forecasting Study, in the next three years the DMRC would have rented out most of its space along metro's track lines for commercial utilisation and advertisements. Not surpisingly, a vast majority of road traffic would have shifted to Delhi Metro as its network expands.

Through rentals alone, the DMRC is expected to generate more than Rs 850 crore revenue from lead retail outlets and ATMs.

As an increasing number of people shift from private modes of communication to the metro, DMRCs revenues will soar to Rs 700 crore through sale of tickets, the study says.

A hefty Rs 600 crore are anticipated to be generated by 2011 from space allocations to corporate advertisers.

''In percentage terms, DMRC would earn 39 per cent of its revenues by leasing out space to corporates for commercial use.

Tickets and rental from advertisers would be about 33 per cent and 28 per cent respectively,'' ASSOCHAM Secretary General D S Rawat said in the Foreward to the study.

In 2007, the DMRC revenues earning stood at Rs 730 crore.

With the expansion plans underway, the project is expected to generate 25,000 jobs for skilled and semi-skilled workforce and become a lead body for providing employment.

The jobs created by the DMRC would employ civil, mechanical, electronics and electrical engineers, besides technicians, station and train controllers, security personnel and other supporting staff, Mr Rawat said.

The study highlights that as of now the DMRC, in its limited operational circles, has not been able to rent out a little more than 40 per cent of its space for commercial gains.

In the next three years, the study is of the view that the DMRC would be able to let out the entire space meant for this purpose.

The DMRC has evolved a strategy wherein rental and advertisement space would be allocated to highest bidders after the accomplishment of the metro projects by 2010, when the national capital will be hosting the Commonwealth Games.

The advertisement opportunities for DMRC will be through its real estate, retail outlets, bank ATMs, ITs, BPO and the electronic media.

Real estate majors like DLF, Parsavnath, Omaxe, Unitech and Sun City are investing heavily in the National Capital Region adjoning the metro stations and network. Manufacturers of cold drinks, sportswear, FMCG, food products and the like have been roped in by the DMRC.

The Delhi Metro network commenced operations in November 2006, the size of which is expected to be 186 km by October 2010.

Taking a cue from the success of DMRC, the government plans metros in each of seven cities which have a population of five million or more. Preliminary studies are to start within the next five years for metros to be built in 13 cities with a population of between three to five million.


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