For the first time, the Employees’ Provident Fund Organisation (EPFO) will participate as an equity investor. Approximately Rs 100 billion is expected to be raised through fresh equity issuance, with an equivalent amount from debt financing. A portion of the equity funding will come from existing unitholders in proportion to their current holdings. The final amount will be determined through the book-building process.

The NHIT's major unitholders include Canadian funds Ontario Teachers' Pension Plan Board and CPP Investment Board Private Holdings, each holding 25 per cent. NHAI holds 15.48 per cent, while SBI AMC owns 9.34 per cent. With the latest asset acquisition, more equity investors are expected to join, including the EPFO.

The NHIT model enables the trust to manage operational highway projects, collect toll revenues, and distribute returns to investors. This structure, along with the toll-operate-transfer (TOT) model, helps NHAI reduce its financing burden. Proceeds from asset monetisation through InvITs are used to repay debt.

Since inception, NHIT has raised Rs 258.99 billion via InvIT and acquired 15 road stretches covering 1,525 km across nine states. The latest acquisitions will include roads in Karnataka, Andhra Pradesh, Uttar Pradesh, Uttarakhand, and Chhattisgarh.

For 2024-25, NHAI aims to raise Rs 540 billion through InvIT, TOT, and project-based financing. It has already monetised two road stretches for Rs 83.53 billion this fiscal year. A total of 34 highway stretches spanning 2,822 km have been identified for monetisation. Meanwhile, NHAI has repaid Rs 560 billion in debt this financial year, with a budgetary allocation of Rs 1.7 trillion set for FY25.

News source: Financial Express