Bharat Highways Infrastructure Investment Trust InvIT

Bharat Highways Infrastructure Investment Trust InvIT is an infrastructure investment trust established to acquire, manage and invest in a portfolio of infrastructure assets in India and to carry on the activities of an infrastructure investment trust, as permissible under the SEBI InvIT Regulations. They were settled by way of the Original Trust Deed, by GRIL (the Settlor), and registered as an infrastructure investment trust with SEBI on August 3, 2022 pursuant to the SEBI InvIT Regulations. The Sponsor is engaged in testing services in the field of transportation engineering and has expertise in NSV survey, FWD survey, pavement design of roads and airports, physical and chemical testing of soil, lime, cement, road roughness testing, concrete and bituminous mix design of road projects. The Sponsor has setup a laboratory at its registered address which is accredited with National Accreditation Board for Testing and Calibration Laboratories for the discipline of chemical, mechanical and non-destructive testing. NMHPL, the Associate of the Sponsor is a road engineering, procurement, and construction company, with experience in design and construction of various road/highway projects. NMHPL has over six years of experience in the execution of infrastructure projects since 2017.  The Sponsor has an established track record of physical and chemical testing of soil and other material (cement testing, fly ash, bitumen emulsion, aggregate testing) at its laboratory accredited by NABL, which enables it to determine the appropriate material mix for development of bituminous and concrete road projects. Further, its capability to assess the roughness and balance life of road projects allows it to determine the appropriate maintenance activity to be undertaken on the road projects. The Sponsor through itself and its Associate, NMHPL, complies with the eligibility requirements under the SEBI InvIT Regulations of ensuring a sound track record in development of infrastructure.  The initial portfolio assets consist of seven road assets, all operating on HAM basis, in the states of Punjab, Gujarat, Andhra Pradesh, Maharashtra and Uttar Pradesh. These roads are operated and maintained pursuant to concession rights granted by the NHAI and are owned and operated by the Project SPVs, which are currently wholly owned by GRIL. All of the InvIT Assets are HAM projects awarded by NHAI and the revenue stream is primarily through annuity payments from the NHAI. GRIL is monetizing future annuity payments (including interest payable thereon) and O&M income receivable from the NHAI by transferring the InvIT Assets to the InvIT.  As per financial performance, Bharat Highways Infrastructure Investment Trust InvIT has posted total income / net profits of Rs 2,170.39 Cr / Rs 149.45 Cr (FY21), Rs 1,600.18 Cr / Rs 62.87 Cr (FY22), Rs 1,537.47 Cr / Rs 527.05 Cr (FY23) and Rs 388.54 Cr / Rs 101.35 Cr (Q2 FY24).  The company, coming with InvIT, is having seven highway projects under seven SPVs and it doing operations primarily on HAM projects. There are no track records of such InvITs are available, so those who wants to participate in road infrastructure investors may apply for the medium to long term rewards. So, we give NEUTRAL rating for this IPO. Readers must consult a qualified financial advisor prior to making any actual investment decisions.

• 1 Anant Nahata
• 2 NextWave Communications Private Limited (“Nextwave”)