Powergrid InvIT IPO: Key Details
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Powergrid InvIT is an infrastructure investment trust setup to own, construct, operate, maintain and invest as an infrastructure investment trust as permissible in terms of the InvIT Regulations, including in power transmission assets in India. It was registered with SEBI as an InvIT on January 7, 2021. Its Sponsor, Power Grid Corporation of India Limited, also acting in the capacity of our Project Manager, is a CPSE under the Ministry of Power, GoI and is listed on BSE and NSE.
Powergrid InvIT is proposed to acquire five projects initially with a total network of 11 power transmission lines of approximately 3,698.59 ckm and three substations having 6,630 MVA of aggregate transformation capacity, as of December 31, 2020, across five states in India.
It intends to distribute at least 90% of the net cash available for distribution to its Unitholders once at least every quarter in every financial year. However, the first declaration of distribution by the Trust shall be made within six months from the listing and trading of units.
- Strong lineage and support from its Sponsor and Project Manager
- Consistent and stable cash flows from assets with long term visibility and low counterparty risks
- Government support and an established regulatory framework
- Strong financial position
- Strategic and critical nature of power transmission infrastructure with low risk of emergence of alternate transmission infrastructure
- Skilled and experienced Investment Manager having strong corporate governance philosophy
- Focused business model with productive and operational efficiency to enhance returns
- Capitalize on value accretive growth through acquisitions and non-transmission revenues
- Optimization of transmission assets through an efficient capital structure
Proceeds from Powergrid InvIT IPO will be used to:
- Providing loans to the Initial Portfolio Assets for repayment or pre-payment of debt, includingany accrued interest, availed by the Initial Portfolio Assets; and
- General corporate purposes
Powergrid InvIT IPO: Investment Manager Financials
|2018||2019||2020 Mar||2020 Dec|
|Revenue from Ops||₹343.57 Cr||₹9,77.16 Cr||₹1,324.3 Cr||₹992.28 Cr|
|Profit before Tax||₹128.52 Cr||₹348.04 Cr||₹487.42 Cr||₹547.65 Cr|
|Profit after Tax||₹114.13 Cr||₹248.06 Cr||₹378.83 Cr||₹337.14 Cr|
Comparison with listed industry peers
|India Grid Trust||113.46||15.41%|
Powergrid InvIT IPO Dashboard
|Issue Size||₹7,734.99 Cr|
|Fresh Issue||₹4993.48 Cr|
|Offer for Sale||₹2,741.51 Cr|
|Face Value||₹10/- per Equity Share|
|IPO Price||₹99 – ₹100|
|Lot Size||1,100 shares|
|Initiation of Refunds||11/04/2021|
|Credit of Shares||12/04/2021|
Lot Size and Price
Powergrid InvIT IPO: Investor Quota and Shares Offered
|Investor Type||Quota||Shares on Offer|
|RII (Retail)||15%||[●] shares|
Powergrid InvIT IPO: Risks
- The Trust is a newly settled trust and does not have an established operating history, which will make it difficult to accurately assess its future growth prospects
- It may be unable to operate and maintain its power transmission projects to achieve the prescribed availability which may adversely affect the cash flows and results of operations
- Substantially all its revenues are derived from payments received from Designated Inter-State Transmission System Customers (“DICs”).
- The ability of the Project Manager to ensure that its power transmission systems are fully operational at all times may be subject to the limitations of the power grid, existing equipment, or operational risks outside of its control
- They may not be able to make distributions to its Unitholders comparable to the Unitholders’ estimated or anticipated distributions or at all.
For complete internal and external risk factors, you can refer the RHP of the company.
Powergrid InvIT IPO: Registrar and Lead Managers
Registrar of the Issue
KFintech (Formerly Karvy)
Selenium Building, Financial District, Nanakramguda, Serilingampally,
Rangareddi, Telangana India – 500 032.
Email: [email protected]
Lead Managers of the Issue
Axis Capital Limited
ICICI Securities Limited
Edelweiss Finanical Services Limited
HSBC SCM Private Limited
Phone: +91-22-4325 2183 / +91-22-2288 2460
Email: [email protected]