Alpha Alternatives is entering the listed infrastructure investment trust (InvIT) space with the launch of Anantam Highways Trust, betting on a model that combines strong governance with retail access.
The Rs 400-crore initial public offering (IPO), which opens on October 7, comes at a time when investor appetite for stable, long-term yield products is rising, even as global funds and developer-backed vehicles crowd the market. The Anantam Highways Trust IPO price band has been fixed at Rs 98-Rs 100 a unit and the offer closes on October 9.
“We could have done a larger IPO. But we chose only 20 percent dilution and no secondary sale. Our game is different. We want to deliver consistent risk-return profiles over the long term, not to chase AUM (assets under management),” Naresh Kothari, founder and managing partner of Alpha Alternatives told Moneycontrol in an interview.
For Kothari, the Anantam InvIT, which will invest in, own and operate road assets, reflects Alpha Alternatives’ broader philosophy.
“We’ve raised 95 percent of our AUM directly from investors, without distributors. Five out of six new clients come through referrals. We’re growing slower but with better quality investors. That’s exactly the philosophy we’re carrying into the public domain,” he said.
“We’re not chasing AUM. We’re building a long-term InvIT platform that can stand the test of time.”
Public vs private InvIT
Kothari said the choice to go public was driven less by governance and more by access to a broader set of investors.
“In private markets, the ticket size is Rs 25 lakh. That excludes a large pool of investors who want stable returns but cannot afford that entry point. With a listed InvIT, we can reach retail,” he said.
He said fixed-income products are now fully taxable, making bank deposits less attractive, while equities and SIPs carry volatility.
“There’s a big space in between for investors looking for stability,” he said.
Building trust beyond private markets
Alpha Alternatives, which has built a name in private credit and alternative investment strategies, is now pitching itself to public investors. The challenge, however, will be to convince them of long-term commitment in an asset class with 13–20 year life cycles.
“The early three to five years of building any business are the toughest. Once you get past that stage and if you’ve built the platform correctly, you can run it for a long time. All our products have five to eight year track records. We don’t chase AUM – we chase risk-return profiles,” Kothari said.
He said Alpha is not a one-person shop. “This is not a boutique dependent on individuals. Each fund has senior teams with multiple layers. If something happens to me tomorrow, at least three people can step in. We’re building an institutional business,” he added.
Jignesh Shah, head of infrastructure at Alpha and CEO of Anantam Highways Trust, said the InvIT was never designed as a one-off.
“Managing this InvIT is as much about infrastructure as it is about investment management. We’re building a world-class, long-term platform that serves both retail and institutional investors,” Shah said.
Also Read: InvIT IPOs gain momentum with deals worth over Rs 20,000 crore in the pipeline
Dilip Buildcon partnership
Unlike developer-led InvITs that often face conflicts of interest, Alpha has separated investment management from operations by bringing in Dilip Buildcon (DBL) as operations and maintenance (O&M) partner and a large unitholder.
“Developer-run InvITs bring O&M skills but face conflicts since the same EPC company runs both ends. Global funds have capital and global experience but not always local expertise. We’ve blended the best of both,” Shah said.
DBL pre-IPO holding of 54 percent in the InvIT will fall to about 44 percent after the listing. It doesn’t own a stake in the investment manager but, as unitholders with over 10 percent holding, is entitled to a board seat.
For DBL, Shah said, the InvIT is a strategic play. “They could have sold 100 percent of their assets, but instead chose to co-create a platform that generates consistent cash flows to balance EPC volatility. They have 18 assets today and will keep winning new projects. This InvIT is their route to public markets,” he said.
For now, the InvIT is focused on Hybrid Annuity Model (HAM) assets but both executives insist they are not restricted to it.
“DBL has strong experience with toll projects as well. For us, it’s about risk-return. If good toll assets come up, we’ll look at them,” Shah said.
Kothari said that the edge lies in nuance. “If you buy quality assets with fixed O&M contracts, there’s little reason to flip them. DBL has taken a 13-year view on its assets, agreeing to fixed-cost O&M. That shows deep alignment,” he said.
Capital flexibility
Shah said the trust remains nimble. “We don’t have a fixed sweet spot in terms of asset size. We can move quickly across small or large acquisitions. Our partner has bid projects across the country, so the pipeline is diverse,” he said.
Funding will not rely solely on leverage, Kothari said.
“We have four options – pay in units, raise debt, use cash flows, or issue fresh equity. DBL is willing to take part compensation in units, and the fund accepts units. That reduces the need for immediate cash. Flexibility in structuring strengthens our acquisition ability,” he said.
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