NHAI Aims To Raise Rs. 5,100 Crore Trough InVIT, Files Papers With SEBI

National Highways Authority of India (NHAI) on Monday, 6th April, has filed draft papers with market regulator agency SEBI, for floating an Infrastructure Investment Trust (InVIT), to raise Rs. 5,100 crore trough fresh issue, as per papers filed at SEBI.

InVITs are instruments on the lines of mutual funds, intended to pool small sums of money from various investors, which assures cash flow over a period of time.

Earlier this month, NHAI chairman Sukhbir Singh Sandhu said that, InvIT, along with the monetisation of operational assets via the (ToT) toll-operate-transfer model and toll securitisation, will help NHAI boost non-debt resources, Financial Express reported.

While asset monetising the operational public infrastructure is key to raise capital for new infrastructure projects, as Finance Minister Nirmala Sitharaman said in her Budget speech for 2021-22, five operational roads with an estimated enterprise value of Rs 5,000 crore were being transferred to the NHAI InvIT.

NHAI, under Bharatmala Pariyojana, is aiming to build 34,800 Km of highways, with an estimated cost of Rs. 5.35 lakh crore, is raising capital in many ways as many projects by NHAI are run under EPC (Engineering procurement and Construction) model, bearing all expenses of project, and private investments continue to be low.

In addition, there would be an offer-for-sale (OFS). However, the OFS amount has not been specified in the draft papers.

Union cabinet has given permission to NHAI to set up InVITs and monetise its assets to raise capital, earlier in December 2019.

ICICI Securities, Kotak Mahindra capital company and SBI capital markets are assigned as merchant bankers to the issue, and the units are proposed to listed on national stock exchange and BSE.

Earlier this year, in January, Power Grid Corporations has filed similar draft papers to raise Rs. 5,000 crore trough InVIT.