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NHAI Completes Largest InvIT Monetization

Why is it in the news?

  • NHAI’s National Highways Infra Trust (NHIT) successfully completed fundraising through ‘InvIT Round-3’ for a total of 889 kilometres of National Highway stretches.
  • This represents National Highway Authority of India’s most extensive monetization endeavour to date, with a total valuation exceeding Rs. 16,000 crores.
NHAI InvITs

·       NHAI’s InvIT was established under the Indian Trusts Act, 1882 and SEBI regulations.

·       In December 2019, the Cabinet approved NHAI’s Infrastructure Investment Trust (InvIT), which was subsequently launched in 2021.

·       NHAI’s InvIT was introduced to facilitate the monetization of roads and attract both domestic and foreign institutional investors to invest in the roads sector, thereby mobilizing additional funds for infrastructure development.

About National Highways Infra Trust (NHIT)

·       NHIT was established in 2021 as an Infrastructure Investment Trust sponsored by the National Highways Authority of India (NHAI).

·       NHIT’s primary objective is to engage in investment activities as an Infrastructure Investment Trust (InvIT).

Infrastructure Investment Trusts (InvITs)

·       InvITs are financial instruments that operate similarly to mutual funds, pooling funds from multiple investors to invest in infrastructure assets that generate cash returns over time.

·       InvITs are listed on exchanges through Initial Public Offerings (IPOs) and are subject to regulation by the Securities and Exchange Board of India (SEBI) under the Infrastructure Investment Trusts Regulations, 2014.

 

 

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