Bharat Highways Infrastructure Investment Trust InvIT

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The formation and operation of an Infrastructure Investment Trust (InvIT) in India, emphasizing its focus on acquiring, managing, and investing in infrastructure assets, specifically in the transportation engineering sector. Here’s a detailed breakdown of the key points from the overview:

Establishment and Regulatory Compliance

  • Foundation and Registration: The trust was established under the Original Trust Deed by GRIL (the Settlor) and registered with the Securities and Exchange Board of India (SEBI) on August 3, 2022, under the SEBI Infrastructure Investment Trust (InvIT) Regulations.

Sponsor’s Expertise

  • Sponsor Background: The Sponsor specializes in testing services for transportation engineering, holding expertise in various surveys and tests essential for the pavement design of roads and airports.
  • Accreditation: The Sponsor operates a laboratory accredited by the National Accreditation Board for Testing and Calibration Laboratories (NABL), covering chemical, mechanical, and non-destructive testing disciplines.
  • Associate Company: NMHPL, an associate company, brings over six years of experience (since 2017) in engineering, procurement, and construction (EPC) of road/highway projects.

Operational Highlights

  • Initial Portfolio: The initial asset portfolio includes seven road assets operating on a Hybrid Annuity Model (HAM) across various Indian states, with concession rights from the National Highways Authority of India (NHAI).
  • Ownership and Management: These assets are managed by Project Special Purpose Vehicles (SPVs), fully owned by GRIL.
  • Right of First Offer (ROFO) Agreement: An agreement with GRIL allows the InvIT the first opportunity to acquire additional assets developed by GRIL.

Strategic Transactions and Future Plans

  • Formation Transactions: The InvIT plans to acquire 100% equity shares of the Project SPVs from GRIL. In return, GRIL will receive units in the InvIT post the issue closing date, as per the Share Purchase Agreements.
  • Growth and Development Strategy: Through its sponsor’s capabilities and strategic acquisitions, the InvIT aims to enhance its portfolio and strengthen its position in the infrastructure sector, especially focusing on transportation infrastructure.

This overview illustrates a strategic approach to infrastructure investment in India, leveraging the Sponsor’s technical expertise and established track record to manage and expand a portfolio of critical assets. The trust’s formation and operations are designed to capitalize on the growth opportunities within India’s infrastructure sector, offering a structured investment vehicle for stakeholders.

Objects of the Bharat Highways Infrastructure Investment Trust InvIT:

The Net Proceeds will be utilized by the InvIT towards the following objects: i. Providing loans to the Project SPVs for repayment/ pre-payment, in part or in full, of their respective outstanding loans (including any accrued interest and prepayment penalty); and ii. General purposes.

Bharat Highways Infrastructure Investment Trust InvIT Details:

Open Date: Feb 28 2024
Close Date: Mar 01 2024
Total Shares: 250,000,000
Issue Size: 2,500.00 Cr.
Lot Size: 150 Shares
Issue Price: ₹ 98 - 100 Per Equity Share
Listing At: NSE,BSE
Listing Date: Mar 08 2024

Promoters And Management:

Ajendra Kumar Agarwal is the chairman and a non-executive Director on the board of the Investment Manager. He is also the managing director on the board of directors and one of the promoters of GRIL. He holds a bachelor of engineering degree in civil engineering from the University of Jodhpur and has over 25 years of experience in the road construction industry. He is responsible for overseeing the overall functioning of GRIL, especially the operational and technical aspects, of GRIL. He heads the in-house design team and is actively involved in continuous value engineering using the latest specifications and methodologies. He is also the head of budgeting, planning and monitoring process which has leveraged the timely completion of the projects. He has been a director on the board of directors of GRIL since 2006. Siba Narayan Nayak is a non-executive Director on the board of the Investment Manager. He has over 34 years of experience in public as well as private sectors, working across various functions including finance, accounts, resource mobilization and indirect taxation. He has specialized exposure in the infrastructure sector more particularly in roads, power and real estate. Presently, he is also working as President (Corporate Affairs and Development) in GRIL and is responsible for its diversification strategies into other business activities. Prior to joining GRIL, he worked with the NHAI. In his five years’ tenure at NHAI as the chief general manager (financial analyst) he has handled several finance and project related activities. He has passed the final examinations of the Institute of Cost and Works Accountants of India and the Institute of Company Secretaries of India. Raghav Chandra is an independent director on the board of the Investment Manager. He holds a master’s degree in public administration from Harvard University, United States of America. He is a former Indian Administrative Service officer from the batch of 1982. He has over 35 years of experience in areas including public administration, tribal affairs, industrial housing and urban infrastructure development. Prior to joining the Investment Manager, he has served in several positions including as the Secretary for the National Commission for Scheduled Tribes, Chairman of the National Highways Authority of India, Joint Secretary for the MoRTH, Principal Secretary for the Urban Administration & Development Department, Government of Madhya Pradesh, Additional Secretary for the Ministry of Agriculture, Government of India and principal secretary for the Technical Education and Training Department, Government of Madhya Pradesh. He has also served as an adjunct faculty in the Indian Institute of Corporate Affairs under the MCA.

Financials of Bharat Highways Infrastructure Investment Trust InvIT:

Particulars ( In Crore )
2021
2022
2023
6M-FY24
Revenue from Operations 2,154 1,586 1,509 368
Interest on deposits with banks 4 10 23 17
Interest from vendor advance and income tax refund 12 4 3 2
Other Income 0.3 0 2 1
Total Revenue 2,170 1,600 1,537 389
Sub - contractor charges 1,637 1,138 412 37
Employees Benefit Expenses 0.5 0.4 0.4 0.2
Other Expenses 34 33 28 15
EBITDA 499 428 1,097 336
Finance cost 265 344 376 201
EBIT 499 428 1,097 336
OPM (%) 23.00% 26.77% 71.34% 86.57%
PBT 234 84 721 136
Tax 85 21 194 34
PAT 149 63 527 101
NPM (%) 6.89% 3.93% 34.28% 26.09%
No.of Shares 43.77 43.77 43.77 43.77
EPS 3.41 1.43 12.03 2.31

Comparison With Peers:

Name of the Company Revenue (In Crore) PAT (In Crore) EPS ( in Rs) P/E CMP Mcap (In Crore)
Bharat Highways InvIT 1,509 527 12.03 8.3 100 4,378
IRB InvIT Fund 1,442 370 6.37 N/A 68.1 3,954
* All the data is as per FY23.

Lead Manager of Bharat Highways Infrastructure Investment Trust InvIT:

  1. Axis Bank Limited
  2. HDFC Bank Limited
  3. ICICI Securities Limited
  4. IIFL Securities Ltd

Registrar of Bharat Highways Infrastructure Investment Trust InvIT:

  1. Kfin Technology Private Limited

Company Address:

Bharat Highways Infrastructure Investment Trust Novus Tower, Second Floor, Plot No. 18, Sector 18, Gurugram,- 122 015 Phone: +91 85888 55586 Email: cs@bharatinvit.com Website: https://www.bharatinvit.com/

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