Capital Infra Trust, formerly known as National Infrastructure Trust, is set to launch its Initial Public Offering (IPO) on January 7, 2025. This InvIT aims to raise funds to acquire, manage, and invest in a diversified portfolio of road assets across India, providing investors with an opportunity to participate in the infrastructure sector’s growth. This article covers Capital Infra Trust InvIT IPO Offering, about the company, financials, reasons to invest, risk factors and our final review.
About Capital Infra Trust
Capital Infra Trust is an infrastructure investment trust established under the Indian Trusts Act, 1882, and regulated by SEBI’s Infrastructure Investment Trusts Regulations. Sponsored by Gawar Construction Limited, the trust’s initial portfolio comprises nine completed and revenue-generating road assets, totaling approximately 682.43 km, located in Haryana, Rajasthan, Bihar, Uttarakhand, Himachal Pradesh, Madhya Pradesh, and Karnataka. These assets operate under the Hybrid Annuity Model (HAM) with an average residual concession life of 11.7 years as of September 30, 2024.
IPO Issue Details
This is not actually called as IPO but an InvIT offering. It issues units and not shares.
- IPO Size: ₹1,578 crore (₹1,077 crore fresh issue + ₹501 crore offer for sale)
- Price Band: ₹99 to ₹100 per unit
- Lot Size: Minimum of 150 units, amounting to ₹15,000
- Listing: NSE and BSE
- IPO Opening Date: January 7, 2025
- IPO Closing Date: January 9, 2025
- Listing Date: Tentatively January 14, 2025
The InvIT has filed its offer document on December 27, 2024, and the units are proposed to be listed on both the Bombay Stock Exchange and the National Stock Exchange.
Financial Overview
Capital Infra Trust Financial Information (Restated)
Amount in ₹ Crore
| Period Ended | 30 Sep 2024 | 31 Mar 2024 | 31 Mar 2023 | 31 Mar 2022 |
|---|---|---|---|---|
| Assets | 4,905.26 | 4,724.07 | 4,283.33 | 2,502.8 |
| Revenue | 792.27 | 1,543.51 | 2,518.92 | 1,981.42 |
| Profit After Tax | 115.43 | 125.77 | 497.19 | 125.56 |
Peer Comparison
The number of Units that InvIT will issue is not presently ascertainable. Hence, the disclosures in respect of number of Units and Net Asset Value per Unit have not been provided as on date of this Offer Document.
In comparison to other InvITs like IRB InvIT Fund and India Grid Trust, Capital Infra Trust’s focus on a diversified portfolio of HAM road assets across multiple states provides a unique investment opportunity. The trust’s strategy to acquire additional assets and diversify beyond HAM projects may offer competitive advantages in the evolving infrastructure sector.
Reasons to Invest in Capital Infra Trust InvIT IPO
- Diversified Portfolio: The trust’s initial portfolio spans nine road assets across seven states, reducing geographical concentration risks.
- Stable Cash Flows: Operating under HAM with regular annuity payments ensures predictable income streams.
- Growth Potential: Agreements in place for future acquisitions indicate potential for portfolio expansion and increased returns.
- Sectoral Support: Government initiatives and investments in infrastructure development provide a favorable environment for InvITs.
Risk Factors
- Market Risks: Limited trading volumes for InvIT units may affect liquidity for investors.
- Regulatory Changes: Alterations in government policies or SEBI regulations could impact operations and profitability.
- Operational Risks: Maintenance and operational challenges of infrastructure assets could affect performance.
- Debt Levels: Future acquisitions financed through debt may increase financial leverage and associated risks.
How to Apply for the IPO
Investors can apply for the Capital Infra Trust InvIT IPO through the ASBA (Application Supported by Blocked Amount) process via their banks or through UPI-enabled brokerage platforms. Ensure that your demat account is active and linked to your bank account for seamless application.
Grey Market Premium (GMP)
As of now, there is limited information available regarding the Grey Market Premium for this IPO. Investors should monitor GMP trends closer to the IPO date to assess market sentiment.
Should You Invest in Capital Infra Trust InvIT IPO?
The Capital Infra Trust InvIT IPO presents an opportunity to invest in India’s infrastructure sector with a diversified portfolio of road assets and potential for future growth. However, investors should carefully consider the risks such as market liquidity and regulatory changes.
This IPO may be suitable for high risk investors looking for stable returns from infrastructure assets with a long-term investment horizon.
Disclaimer: The above article is for educational purposes only and should not be considered as investment advice. Please consult a financial advisor before making any investment decisions.
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