NHAI in talks to raise Rs 9,000 crore for its InvIT

By FY2024, NHAI and the Ministry of Road Transport and Highways had realised around Rs 53,541 crore through ToT (toll-operate-transfer) and InvIT. 

The National Highways Authority of India (NHAI) is in talks with investors to raise around Rs 9,000 crore (approximately $1.03 billion) for its National Highways Infra Trust (NHIT), the biggest round of fundraising for the state-backed trust so far, sources have told Moneycontrol.

This will also be the biggest-ever fundraise by a roads focused infrastructure investment trust (InvIT) in the country, they said.

The funds will be used to acquire a portfolio of road assets from its sponsor NHAI, which will significantly increase the assets managed by InvIT.

“In the fourth round of acquiring assets, NHIT will acquire around six highways of a total length of 500 km in Andhra Pradesh, Chhattisgarh, Uttar Pradesh, Rajasthan, Uttarakhand and Gujarat from the NHAI,” a senior NHAI official told Moneycontrol on condition of anonymity.

Existing large institutional shareholders such as Canada’s biggest pension fund manager CPP Investments and Ontario Teachers’ Pension Plan (OTPP), which together hold 50 percent stake in the InvIT, are likely to participate in this round too, like in the previous rounds, the sources said.

A large chunk of the fundraise will also come from domestic institutional investors such as insurance companies, mutual funds, corporate treasuries as well as family offices, they added.

NHAI holds a 15.48 percent in NHIT, while CPP Investments and OTPP hold 25 percent each.

NHIT aims to complete the fund raising before the end of the current financial year on March 31, 2025 after it was delayed in 2024 due to uncertainty around interest from foreign investors amid geopolitical tensions.

“There was uncertainty around the quantum of investment from one of the NHIT’s biggest investors due to escalated geo-political tensions,” another NHAI official said.

The official said the instability in both domestic market and global markets due to the general election in India and the United States also led to delays.

In its previous fundraise in March 2024, NHIT raised Rs 7,272 crore from investors and acquired assets worth Rs 16,300 crore from NHAI.

While CPP Investments declined to comment on Moneycontrol’s queries, NHAI and OTPP had not responded to emails seeking their response till the time of publication.

National Highways Infra Trust

NHIT has a portfolio of 15 road stretches spanning 1,525 km in nine states — Uttar Pradesh, West Bengal, Assam, Gujarat, Maharashtra, Madhya Pradesh, Rajasthan, Karnataka and Telangana.

Concession period on these roads ranges from 20 to 30 years. The trust's assets had an enterprise valuation of Rs 29,041 crore, Q2 FY25 presentation of the InvIT said.

Also Read: Govt keeps NHAI’s borrowings to a minimum for 4th straight year

Monetisation plan

Under the National Monetisation Pipeline (NMP), the road sector was expected to account for Rs 1.6 lakh crore.

By FY24, NHAI and road transport and highways ministry realised around Rs 53,541 crore through toll-operate-transfer and InvIT.

Since the highway monetisation programme began in 2018-19, NHAI has raised Rs 1.08 lakh crore through the recycling of assets.