Powergrid Infrastructure Investment Trust IPO
Powergrid infrastructure investment trust is an InvITs that is set up to own, operate, maintain, construct, and invest as an infrastructure investment trust. It was registered on 07th January 2021 with SEBI as an InvIT.
As of 01st November 2020, its sponsor also conferred with “Maharatna” was India's largest power transmission company in terms of the length of transmission lines. As of 31st August 2020, its power grid corporation has more than 85% of cumulative inter-regional power transfer capacity.
Powergrid corporation was engaged in project designing, planning, constructing, operating, and maintaining power transmission projects across the country and also has undertaken the operations of the Indian telecom infrastructure sector. As of 30th September 2020, it was providing transmission and distribution consultancy services in 21 countries including India.
Powergrid InvIT has been given a credit rating of Care AAA, Provisional [ICRA] AAA (Stable), Stable by ICRA Limited/Stable & Provisional CCR AAA, CRISIL Ratings Limited, and CARE Ratings Limited, respectively.
The sponsor of the InvIT is Power Grid Corporation of India Limited, a unit of the Ministry of Power, Government of India.
What is Infrastructure Investment Trust (InvIT)?
InvITs or infrastructure investment trusts are regulated by the securities exchange board of India and work like mutual funds and REITs. InvITs also pools the investment from different investors and invests them further into different infrastructure projects. An investor has been given the units of InvITS and they earn a portion of the units of the income from the projects. The cash flow generated from the projects is further distributed to the unitholders.
Strengths of the Company:
- Strong lineage and good support from the project manager & sponsor
- Stable and consistent cash flows with low counterparty risk and long term visibility
- Established regulatory framework backed with government support
- Strong financial statements
- Experienced investment manager with strong corporate governance philosophy
Purpose of the IPO:
- Provide loans for the repayment or pre-payments of debt to initial portfolio assets, along with any accrued interest
- For general corporate purposes
Financial Performance of the company(SPV):
| For the six-month period ended 30th September 2020 | FY 2020 | FY 2019 | FY 2018 | |
| Total Revenue | 674.57 | 1,334.09 | 984.12 | 345.59 |
| Total Expenses | 307.69 | 846.67 | 636.08 | 217.07 |
| Profit After Tax | 208.90 | 378.82 | 248.06 | 114.13 |
| Total Assets | 6,872.72 | 6,821.21 | 7,000.26 | 6,504.88 |
*All the values are in crores and as per RHP.
Powergrid Infrastructure Investment Trust IPO DRHP
IPO details:
| Market Lot | Shares |
| Minimum Order Quantity | Shares |
| Price Band | ₹ - ₹ per equity share |
| Issue type | |
| Issue Size | ₹ Crores |
| Fresh Issue | ₹4,999.48 Crores |
| Offer for Sale | ₹ Crores |
| Listing | NSE, BSE |
Important IPO dates:
| Open Date | 29th April 2021 |
| Close Date | 03rd May 2021 |
| Basis of Allotment Date | May 2021 |
| Initiation of Refunds | May 2021 |
| The credit of shares to Demat Account | May 2021 |
| Listing Date | May 2021 |
Allocation Quota:
| Category | Portion |
| Qualified Institutional Buyers (QIBs) | Not more than 75% |
| Non- Institutional Buyers (NIIs) | Not less than 25% |
| Strategic Investors | Not less than 5%, & Not more than 25% |
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