National Infrastructure Trust

 National Infrastructure Trust files for Rs 1,600 cr IPO

National Infrastructure Trust, an infrastructure investment trust sponsored by Gawar Construction Limited (“GCL” or “Sponsor”). The trust was established on September 25, 2023 and registered with SEBI as on March 7, 2024 with the objective to acquire, manage and invest in portfolio of infrastructure assets in the country. The infrastructure investment trust has filed its Draft Offer Document with the regulator to raise an aggregate amount of Rs 1,600 cr via an issue of units to the public.

 

The IPO comprises of fresh issue of units aggregating up to Rs 1200 crore and an offer for sale of up to Rs 400 crore by Sponsor Selling Unitholder. The Issue will be made through the book building process wherein 75% excluding the strategic investor portion will be available to institutional investors and 25% to non-institutional investors.

 

The Net Proceeds are proposed to be utilized towards providing loans to the Project SPVs for repayment/ pre-payment of external borrowings, in part or in full from financial lenders; Loans to Project SPVs for repayment of unsecured loans availed by the Project SPVs from the Sponsor

 

The Sponsor to the Issue, Gawar Construction Limited will subscribe to 15% of the total post issue unit capital of the InvIT in order to comply with the sponsor lock in requirements. Trustee and Investment Manager to the issue are Axis Trustee Services Limited and Gawar Investment Manager Private Limited.

 

National Infrastructure Trust is an infrastructure investment trust sponsored by Gawar Construction Limited (“GCL” or “Sponsor”), established on September 25, 2023 with the objective to carry on the activities of, and to make investments as, an infrastructure investment trust, as permissible under the SEBI InvIT Regulations.

 

The Sponsor, Gawar Construction Limited (“GCL” or “Sponsor”) is an infrastructure development and construction company in India, with over 15 years of experience, primarily engaged in the construction of road and highway projects across 19 states in India for various government/ semi -government bodies and statutory authorities including NHAI, Ministry of Road Transport & Highways (MoRTH), Mumbai Metropolitan Regional Development Authority (MMRDA) and Central Public Works Department (CPWD). Since 2008, the Sponsor has undertaken more than 100 road construction projects.

 

As on the date of the Draft Offer Document, the Sponsor has a portfolio of 26 road projects on a hybrid annuity mode (“HAM”) with NHAI, of which 11 are completed projects, including the five acquired assets which were erstwhile owned by Sadbhav Infrastructure Project Limited, and 15 under-construction projects.

 

National Infrastructure Trust intends to acquire, manage and invest in the nine completed and revenue generating Initial Portfolio Assets, aggregating to approximately 683.875 kms, operated and maintained, pursuant to concessions granted by the NHAI and are owned and operated by the Project SPVs. Three road assets are in Haryana, One road asset each in Rajasthan, Bihar, Himachal Pradesh, Madhya Pradesh, Karnataka and Uttarakhand. 

 

Its Initial Portfolio of Assets has a weighted average residual concession life of 12 years as of June 30, 2024.

 

The Trust, through the Investment Manager, will also have the right to acquire new projects through a right of first offer with our Sponsor in accordance with the Right of First Offer Agreement (“ROFO Agreement”). The Sponsor is currently developing 17 HAM assets consisting of approximately 546.344 km of roads across eleven states in India.

 

The revenue from operations of the SPV for the Fiscal 2024, 2023 and 2022 was Rs 1,485 crs, Rs 2.033 crs, Rs 1,908 respectively. Projected cash flows for FY25, FY26 and FY27 is estimated to be Rs 582 crs, Rs 662 crs and Rs 585 crs respectively.

 

The initial portfolio of 9 assets for the trust is expected to receive annuities amounting to Rs 6020.10 cr by the end of its concession period. As on June 30, 2024 it had received annuities amounting to Rs 464.53 crs

 

As per the Draft offer document, India’s road network has grown 59% to become the second largest in the world in the last 10 years. Till November 2024, cumulatively 5,248 kms of National Highways have been constructed. A total of 202 national highway projects worth ₹ 79,789 crore (US$ 9.59 billion) are at the implementation stage in the country and are 6,270 km in length. The Government of India has allocated ₹ 111 lakh crore (US$ 1.4 trillion) under the National Infrastructure Pipeline for

FY25.

 

SBI Capital Markets Limited and HDFC Bank Limited are appointed as the lead managers to the issue. Axis Trustee Services Limited has been appointed as the sole Trustee of the Trust.  The Units are proposed to be listed on BSE and NSE