MC EXCLUSIVE IRB InvIT Fund likely to raise up to Rs 3,000 crore via QIP to fund road acquisitions

IRB InvIT Fund is the first publicly traded InvIT in India, which listed on stock exchanges in 2017

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IRB InvIT Fund, India’s first publicly traded infrastructure investment trust, is planning to tap institutional investors to raise as much as Rs 3,000 crore to fund acquisition of three road assets worth over Rs 8,436 crore, sources told Moneycontrol.

IRB InvIT Fund, sponsored by IRB Infrastructure Developers Ltd, is planning to raise funds through a so-called qualified institutional placement (QIP) offering, the sources said. It is working with investment banks Citi and Kotak Mahindra Capital on the proposed QIP. The timing of the launch is still to be finalised, they added.

The InvIT has already secured shareholders’ nod to raise Rs 5,000 crore to finance the acquisition through various fundraising routes, including a QIP. The QIP offering is likely to be smaller at around Rs 3,000 crore or even less, the sources said.

If the offer garners significant institutional demand, it may be upsized.

In May, IRB InvIT Fund signed a non-binding offer with IRB Infrastructure Trust, the private InvIT backed by Singapore’s sovereign wealth fund GIC, for the transfer of its three build-operate-transfer (BOT) highway assets. The Hapur-Moradabad, Kaithal-the border section of NH 152 in Rajasthan and Kishangarh-Gulabpura highways together cover 1,800-lane kilometres, with a total enterprise value of around Rs 8,450 crore and an equity value of Rs 4,905 crore.

Also read: New road assets ensure sustained returns for IRB InvIT unitholders

In an emailed response to Moneycontrol’s query, IRB Infrastructure Developers chairman and Managing director Virendra D Mhaiskar said, “We are truly grateful to all the unitholders of the IRB InvIT Fund for demonstrating their strong trust and confidence in the fund’s growth strategy by passing the resolutions.”

The group remains committed to enhancing unitholder value by actively exploring opportunities to add quality assets to the portfolio, he said.

Emails sent to Kotak Mahindra Capital and Citi did not elicit a response till the time of publication.

First public InvIT

IRB InvIT Fund was the first infrastructure investment fund to list on Indian stock exchanges in 2017, three years after the Securities and Exchange Board of India introduced the InvIT and Real Estate Investment Trust (REIT) regulations.

The IPO saw the IRB sponsored trust raise more than Rs 5,000 crore through a mix of primary share sale of Rs 4,300 crore and an offer for sale by existing shareholders.

The InvIT originally had a portfolio of five toll roads. In 2022, it acquired a hybrid annuity model (HAM) road Vadodara-Kim Expressway for Rs 342 crore form IRB Infrastructure Developers.

Its current portfolio has an enterprise value of Rs 7,850 crore. The portfolio generated gross toll collection of Rs 1,040 crore in FY25, 3 percent more than the previous year.