Shrem InvIT said it will add 10 road assets during this fiscal year to grow its annual revenue substantially.
Currently, it earns a revenue of about ₹1,160 crore every year from 24 road assets and post acquisition of the additional assets, the annual revenue is projected to grow to ₹2,100 crore, a top executive said. “We are already working on acquiring 10 more road assets in FY23. These are assets located in in Karnataka, Chhattisgarh, Madhya Pradesh, Jharkhand, Maharashtra, Odisha, and Andhra Pradesh with a total lane kms of 2501 kms,” said Nitan Chhatwal, Managing Director, Shrem InvIT. He said the total asset base size is around Rs 6,500 crore and the acquisition should complete by March 2023. The debt of the assets will be refinanced through banks and Shrem would issue units to the entities from which it would be acquiring the assets. “Annuities under HAM are fixed and received on a semi-annual basis. As per the concession agreement, the life of the project SPV is 15 years i.e 30 annuities are received during the life of the asset,” he said.
The assets to be acquired are all Hybrid Annuity Model (HAM) projects, which are purely annuity based and are backed by the National Highway Authority of India (NHAI), he added.
Shrem InvIT is currently listed on NSE and it plans a public issue by December 2023.
On InvITs as an asset class, he said these units are hybrid instruments having characteristics of both debt and equity and are thus mostly insulated from market volatilities. Hence, they are safe instruments compared with equities.
“Shrem InvIT has been rated AAA by ICRA and India Rating which signifies highest safety,” he added.
