NHAI-backed Raajmarg Infra Investment Trust IPO sees 13.74x subscription on last day; check listing, allotment dates

The IPO share allotment will be finalised by March 18, while the participants can start trading in Raajmarg Infra Investment Trust units effective March 24.

• Raajmarg Infra Investment Trust IPO sees 13.74 times subscription
• Raajmarg InvIT to raise Rs 6,000 crore via IPO
• Price range for the offer at Rs 99-100 per unit

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NHAI-sponsored Raajmarg Infra Investment Trust's maiden public issue has garnered strong demand from all categories of investors, subscribing 13.74 times till the final day of bidding, i.e. March 13.

The infrastructure investment trust that proposes to have an initial portfolio of five toll roads in Jharkhand, Andhra Pradesh, Tamil Nadu and Karnataka under the toll operate transfer (TOT) model conceived by NHAI approached capital markets to raise Rs 6,000 crore via initial public offering (IPO). The price range for the offer is Rs 99-100 per unit.

The InvIT has attracted demand for 293.1 crore units against the IPO size of 21.3 crore units with institutional investors bidding 19.15 times, and other investors 7.26 times their allotted quotas during March 11-13.

The healthy response to the offer was despite the ongoing steep correction in the equity markets. The benchmark indices fell more than 5 percent during the week and over 8 percent in current month.

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The IPO share allotment will be finalised by March 18, while the participants can start trading in Raajmarg Infra Investment Trust units effective March 24.

After listing, Raajmarg InvIT will be the sixth trust getting listed on the bourses after Cube Highways Trust, Vertis Infrastructure Trust, Interise Trust, National Highways Infra Trust, and IRB Invit Fund.

After the Concession Agreements between the project SPV and NHAI (as concessioning authority), the project SPV will acquire, operate and maintain five toll-road projects -- Gorhar to Barwa Adda, Chilakaluripet-Vijayawadain, Chennai Bypass, Chennai -Tada, and Neelmangla Tumkur - with a concession period of 15 years, forming part of the Golden Quadrilateral project.

The Trust will have the responsibility for the supervision of the operation and maintenance of the toll roads from the operation and maintenance handover date. In return, the project SPV is required to pay the concession fee to the NHAI prior to the commencement of the concession.

Raajmarg InvIT will utilise Rs 5,850 crore of net proceeds from the IPO for infusion of debt and equity into the project SPV, which will be utilised by the project SPV for the payment of concession value of the InvIT assets to NHAI, and the remainder funds for general purposes.

The Trust believes that the infusion of the funds into the project SPV, in order to meet its obligations under the Concession Agreements, will enable the project SPV to acquire the necessary rights under the Concession Agreements.

SBI Capital Markets, Axis Capital, ICICI Securities, and Motilal Oswal Investment Advisors are managing the Raajmarg Infra Investment Trust IPO.