NHIT raises Rs 16,000 crore to acquire nearly 900 km of road from NHAI

New Delhi: National Highways Infra Trust (NHIT) on Tuesday said it has raised over Rs 16,000 crore through equity and debt to acquire nearly 900 km of road from NHAI.

This is the largest monetization of assets by the National Highway Authority of India (NHAI).

NHIT is an infrastructure investment trust (InvIT) sponsored by the NHAI.

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According to an official statement, "NHIT, has concluded fund-raising through 'InvIT Round-3' for National Highway stretches of aggregate length of 889 kilometers at an enterprise value of over Rs 16,000 crore, which is the largest monetization by NHAI and one of the largest transactions in the history of Indian road sector."

NHIT has raised unit capital of around Rs 7,272 crore from marquee domestic and international investors and debt of around Rs 9,000 crore from Indian lenders, to fund the acquisition of National Highway stretches.

InvIT is an instrument on the pattern of mutual funds, designed to pool money from investors and invest in assets that will provide cash flows over a period of time.

The letter of acceptance (LOA) to raise the highest-ever concession value through 'InvIT Round-3' was issued in February 2024, it added.

The units witnessed strong demand from both existing and new investors, including foreign pension funds viz Canada Pension Plan Investment Board and Ontario Teachers' Pension Plan Board, which are existing unit holders and subscribed to the maximum limit of 25 percent each.

Domestic pension/provident funds which subscribed in the funding round include (IOCL Employees PF, L&T Staff PF, Rajasthan Rajya Vidyut Karamchari Pension Fund, SBI Pension etc), insurance companies (Tata AIG, SBI Life, HDFC Life), mutual funds (SBI, Nippon India), banks and few others, the statement said.

NHAI also subscribed to its share of 15 percent of the units at the same price, it added.

With completion of the third round of monetization the total realized value of all three rounds of InvIT stands at Rs 26,125 crore.

It holds a diversified portfolio of 15 operating toll roads with an aggregate length of about 1,525 km spread across the 9 states of Assam, Gujarat, Karnataka, Madhya Pradesh, Maharashtra, Rajasthan, Telangana, Uttar Pradesh and West Bengal, with concession periods ranging between 20 to 30 years.

NHIT, the Infrastructure Investment Trust sponsored by National Highways Authority of India (NHAI), was set up in 2021 to support the government's National Monetization Pipeline.

In a statement, Canada Pension Plan Investment Board (CPPIB) said that it has made a follow-on investment of Rs 1,820 crore in the units of NHIT. The investment is part of NHIT's fundraise by way of institutional placement.

"Following this investment CPPIB will continue to hold 25 percent of the units in NHIT," it said. CPPIB's total investment in NHIT will increase to Rs 3680 crore.

Commenting on NHAI's asset monetisation, Ministry of Road Transport & Highways secretary Anurag Jain said NHIT is a successful example of public-private partnership (PPP), in which it has played a very important role in supporting National Monetisation Pipeline.

NHAI Chairman Santosh Kumar Yadav said, "We are pleased that NHIT has successfully completed the largest monetisation of roads for NHAI. We expect it to continue to play a stellar role in the monetisation and development of the Indian roads sector".

NHIT MD (investment manager) Suresh Goyal said, "We thank the existing investors for their continued faith and welcome the new partners for coming on board in strengthening NHIT and supporting NHAI in the development of India's road sector."

Since November 2021, NHIT has cumulatively raised around Rs 12,000 crore through first two rounds of monetization for acquisition of eight operating road assets with an aggregate length of 636 km from NHAI.

In November 2021, units of NHIT were issued at a price of Rs 101 and were listed on both BSE and NSE.

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