Citius Transnet Investment Trust

Citius Transnet Investment Trust transport sector-focused infrastructure investment trust (the 'Trust'), established with an objective to acquire, manage and invest in a portfolio of transport infrastructure assets, including roads, in India. The sponsor of the Trust is Epic TransNet Infrastructure Private Limited (formerly known as Watrak Infrastructure Private Limited). The Sponsor is wholly owned by the schemes of the Infrastructure Yield Trust (that is, Infrastructure Yield Plus II, Infrastructure Yield Plus IIA and India Infrastructure Yield Plus II), an AIF managed by EAAA India Alternatives Limited ('EAAA'). As of March 31, 2025, EAAA managed three out of the 16 funds focused on infrastructure investments and ranks third among infrastructure investment managers by total assets under management ('AUM'). EAAA operates a diversified, multi-strategy platform, in large, under-tapped and fast-growing alternative asset classes, focusing on providing income and yield solutions to a diverse client base, including, global pension funds, insurance companies and ultra-high net worth individuals. It is supported by an asset management team of 61 members (in addition to in-house teams of the Initial Portfolio Assets comprising 279 employees), 71 employees in the Project Manager of the Trust and 80 investment professionals as of December 31, 2025. The sponsor group comprises the Sponsor, Infrastructure Yield Trust (through its schemes Infrastructure Yield Plus II, Infrastructure Yield Plus IIA and India Infrastructure Yield Plus II), Epic Transnet Project Management Private Limited (formerly known as Chennai-Tada Tollway Private Limited) (the 'Project Manager'), and Neelambur Madukkarai Tollway Private Limited (collectively, the 'Sponsor Group'). Subject to completion of the Formation Transactions, the initial portfolio of road assets will comprise 10 toll and annuity projects, together with the relevant project special purpose vehicles through which they are held, and Epic Concesiones 3 Private Limited and SRPL Roads Private Limited, the holding companies of all Project SPVs, except for one Project SPV, Thrissur Expressway Limited ('TEL'), which will be held. The Initial Portfolio Assets comprise a total of 3,406.71 lane-kilometers (seven toll assets spanning more than 3,043.22 lane kilometers, and three annuity assets spanning more than 363.49 lane-kilometers) across nine different Indian states as of the date of this Offer Document. They believe the Project SPVs have a strong operational history as four of the toll assets have a tolling history of more than 12 years and two of the other toll assets have been collecting toll for over 5 years. As of the date of this Offer Document, the Project SPVs are held directly or indirectly by alternate investment funds (“AIFs”) registered with SEBI and managed by EAAA. They have, as such, prior to the completion of the Formation Transactions, benefited from the regulated management framework applicable to them as companies held by AIFs. The Trust has also entered into an agreement that grants a right of first offer for the acquisition of 11 hybrid annuity model (“HAM”) road assets held or to be acquired by the EAAA Platform (the “Identified ROFO Assets”, and the agreement, the “ROFO Agreement”). The EAAA Platform, the Sponsor and members of the Sponsor Group have experience in managing and operating road, renewable, and transmission infrastructure assets, with an established governance framework that guides investment and asset management practices. The origination efforts of the EAAA Platform are driven by an investment team, which included 80 members as of December 31, 2025, enabling access to promoters, developers, and financial institutions. The EAAA Platform is well positioned for further growth in the future, given its established asset acquisition and capital-raising capabilities, which in turn enable it to identify and pursue new opportunities in the transport sector, including the roads sector. Furthermore, the EAAA Platform has set up, and continues to manage, operate and grow the AnZen India Energy Yield Plus Trust (“AnZen”), an energy-focused infrastructure investment trust registered in India with SEBI demonstrating the ability of the EAAA Platform to launch and manage assets with the structure of the InvIT.  The toll assets particularly benefit from India’s economic growth, leveraging increase in GDP and serving as an effective hedge against inflation. Toll based road assets provide a degree of income stability and inflation protection, as most concessions have inflation linked toll rate revisions or periodic toll hikes (Source: CRISIL Report). Combined with steady traffic growth on key national corridors, this structure allows InvIT cash flows to naturally adjust for inflation, thereby offering investors a built-in hedge and stable real returns over time (Source: CRISIL Report). The annuity and HAM assets typically provide stable cash flows over the residual concession life. With respect to annuity assets, the concessionaire is responsible for the construction and maintenance of the project during the concession period. Variability in user fee gives rise to revenue risk, which is borne by the authority in annuity and HAM assets. The concessionaire generates revenue through fixed annuity payments received from the authority over the concession period (Source: CRISIL Report). In a HAM project, the concessioning authority grants 40% of the total project cost during the construction phase and the remaining 60% is borne by the concessionaire. HAM projects combine elements of Engineering, Procurement, and Construction (“EPC”) and annuity-based approaches, aiming to balance financial responsibility between the government and the concessionaire (Source: CRISIL Report). Under this model, the concessionaire’s financial burden during the construction phase is reduced, while assured revenues are ensured during the operational phase through fixed annuity payments, interest on the diminishing balance of project cost, and inflation-linked O&M payments (Source: CRISIL Report). The concessionaire undertakes both construction and maintenance responsibilities, while revenue risks arising from fluctuations in user fees are borne by the authority. Variability in user fee gives rise to revenue risk, which is borne by the authority. However, the concessionaire generates revenue through fixed annuity payments received from the authority over the concession period (Source: CRISIL Report). Furthermore, given the relevant authority is the central government or its agencies, the counterparties present a low risk of default, offering assurance regarding the stability of the revenue under the concession agreements with these authorities (Source: CRISIL Report). The toll assets are mature and also have average residual lives of more than 10 years, which may be considered relatively long for road assets (Source: CRISIL Report). As of December 31, 2025, the toll based Project SPVs had a simple average operational history of 10.13 years and a weighted average residual life (by enterprise value (“EV”) weight) of 12.93 years (Source: CRISIL Report). Furthermore, the EV of the largest asset (as a proportion of overall EV of the Initial Portfolio Assets) standing at 26.11% is comparable to some of the other financial  sponsor driven road InvITs, indicating that the portfolio is less concentrated, thereby limiting the impact if any single asset were to underperform or face valuation changes (Source: CRISIL Report). The metric expresses the EV of the single largest asset as share of its total portfolio EV, providing an immediate read on dominant-asset dependence (Source: CRISIL Report). Additionally, other Herfindahl-Hirschman Index (“HHI”) score (a measure of portfolio dispersion) is lower at 40.01 compared to some of the other road InvITs (Source: CRISIL Report). The HHI takes into account both the number of assets and their relative EV weights, with a lower HHI score indicating a more diversified portfolio (Source: CRISIL Report). The toll roads forming part of the Project SPVs are situated in regions with high economic activity, thereby indicating strong, stable and predictable long-term traffic as well as revenue growth prospects (Source: CRISIL Report).  On BRLM's front, Axis Capital Limited, Ambit Private Limited, ICICI Securities Limited are associated with this IPO, and has not handled any SME / Main board IPOs in last three fiscal years. ( As on 10.04.26 ) As per financial projections, Citius Transnet Investment Trust may generate cash around Rs 862.15/- Cr, Rs 1,060.52/- Cr and Rs 1,095.55/- Cr respectively in FY27, FY28 and FY29. So it may generate around 10% yields and it will start from next year itself. So we give NEUTRAL rating to this infrastructure trust.