PowerGrid Infrastructure Investment Trust debuted at Rs 104 on the BSE as well as National Stock Exchange. This equates to a 4 percent premium over issue price of Rs 100 per unit.
PowerGrid InvIT was trading 3.5 percent higher at Rs 103.50, with volume of 10.27 lakh units on the BSE, while it was up 3.45 percent at Rs 103.45, wit volume of 2,64,17,100 units on the NSE, at 11:09 hours IST.
It touched an intraday high of Rs 104.97 and low of Rs 103.40 on the BSE, while it saw a day’s high of Rs 104.90 and low of Rs 103.45 on the NSE.
This is the first infrastructure investment trust (InvIT) from the government company to raise funds from IPO and list on the bourses.
Maharatna public sector undertaking Power Grid Corporation of India, the largest power transmission company, is the Sponsor for PowerGrid InvIT, while PowerGrid Unchahar Transmission, a wholly-owned subsidiary of Power Grid Corporation, is the Investment Manager and is the responsible for managing the Initial Portfolio Assets as well as undertaking investment decisions relating to their assets.
Of the sponsor tariff-based competitive bidding (TBCB) projects, PowerGrid InvIT was 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 2020, across five states in India, which is an Initial Portfolio Assets of the InvIT.
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After the IPO, the Trust will own 74 percent of the shareholding in each of the 5 TBCB projects, and the remaining 26 percent stake will be acquired through debt (from Power Grid) after the lock in period that ends by 2024.
PowerGrid InvIT successfully raised Rs 7,735 crore through the public issue which had comprised a fresh issue of Rs 4,993.48 crore and an offer for sale of Rs 2,741.51 crore by unit holders.
The net proceeds from the fresh issue will be utilised for providing loans to the Initial Portfolio Assets for repaying of debts.
“This IPO will give you a consistent yield of around 8 percent that is why it is called InvIT. In InvIT, Trust manages the assets of the company and then whatever they earn while managing the assets will be distributed amongst the unit holders. As in this InvIT assets will be those 5 power transmission projects, so the company will manage these assets and earn revenue and then distribute those revenue among the unit holders,” said Yash Gupta, Equity Research Associate at Angel Broking.
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