NHAI InvIT surges 7% on raising ₹1,430 cr via institutional placement

Shares of National Highways Infrastructure Trust (NHAI InvIT) rallied over 7% in intraday trade on Thursday after the infrastructure investment trust sponsored by the National Highways Authority of India (NHAI) raised ₹1,430 crore from domestic and international investors, through the placement of its units. The capital proceeds from the institutional placement will be used to acquire three brownfield toll roads, currently owned by NHAI.

The offer, which opened for subscription between September 30 to October 3, consisted of an allocation of 111,602,600 units to institutional investors at an offer price of ₹109 per unit.

Besides, NHAI InvIT has also filed its prospectus with market regulator SEBI to raise ₹1,500 crore through the issuance of non-convertible debentures (NCDs). The NCDs would carry a coupon of 7.90% payable semi-annually and would be available for subscription by both retail and institutional investors.

Boosted by the development, shares of NHAI InvIT gained as much as 7.5% to hit a 52-week high of ₹116.1, against the previous closing price of ₹108 on the Bombay Stock Exchange (BSE). In contrast, the BSE benchmark Sensex was trading 411 points lower at 57,214 levels at the time of reporting.

As part of the institutional placement, Canada Pension Plan Investment Board (CPPIB) proposed to make an additional equity investment of ₹357 crore (C$60 million) in the company. This investment by CPPIB, through an institutional placement undertaken by NHAI InvIT, follows an initial C$257 million investment in the company’s IPO in November 2021.

“Canada Pension Plan Investment Board today announced an equity investment of ₹357 crore (C$60 million) in National Highways Infra Trust, an infrastructure investment trust (InvIT) sponsored by the National Highways Authority of India (NHAI),” CPP Investments says in a release.

Following the fresh equity investment, CPP Investments will continue to hold 25% of the units in NHAI InvIT.

“The acquisition will increase the size of NHAI InvIT’s portfolio from five to eight toll roads – all of which have been acquired from NHAI, a statutory authority set up in 1988 by an act of the Indian Parliament and responsible for developing, maintaining and managing national highways in India,” says CPP Investments.

The total portfolio now spans approximately 636 kilometers across seven Indian states: Gujarat, Karnataka, Madhya Pradesh, Maharashtra, Rajasthan, Uttar Pradesh and Telangana.

Commenting on the development, Scott Lawrence, Managing Director & Global Head of Infrastructure, CPP Investments said, “We have been an active investor in India’s infrastructure sector since 2014. This follow-on investment further deepens our commitment to the NHAI InvIT platform to acquire road projects across the country, ultimately delivering solid long-term returns for the CPP Fund.”

“We believe institutional capital will continue to play a meaningful role in addressing India’s infrastructure investment needs,” he added.