India’s first infra trust 8.5 times oversubscribed

The government of Singapore and the city state’s monetary authority acted as one of the trust’s largest anchor investors.

The IPO of India’s first infrastructure trust, sponsored by local road developer IRB Infrastructure Developers, was 8.5 times oversubscribed, helping it raise more than 50 billion rupees ($774 million; €709 million).  

The IRB InvIT listing, comprising around 251 million units of shares, received bids for 2.15 billion units from institutional, corporate and individual investors, according to the National Stock Exchange of India. 

The fund raised approximately 50.33 billion rupees, said IDFC Bank, one of the IPO’s bookrunners. Out of the total sum, 47.45 billion rupees was raised via the issue of new shares, while the rest came from the sale of existing shares by the sponsor, the investment bank added.

The IPO data also pointed out that subscriptions from institutional investors exceeded nearly 11 times their allocation, while the corporate and individual investor offer was oversubscribed 5.89 times. 

Prior to the public offer, IRB also raised nearly 21 billion rupees ($325 million; €298 million) by allocating a combined 205 million units of shares to 28 anchor investors at 102 rupees per unit– the upper end of its initial price range – on 2 May. 

The Singaporean government topped the early birds’ list, with about 20 percent of the anchor investor allocation and a 4.2 billion-rupee investment in the trust, according to a regulatory filing by IRB. The Monetary Authority of Singapore followed with a 1.5 billion-rupee commitment, equivalent to 7.36 percent of the anchor investor portion. 

Other international anchor investors included funds managed by Australia’s Platinum Asset Management, BNP Paribas Arbitrage, Schroder’s funds, Deutsche Global Infrastructure Fund, RREEF America’s Future Fund Board of Guardians, Morgan Stanley and Colonial First State’s Commonwealth Asian Share Fund 4. 

Domestic institutions such as Birla Sun Life Insurance, HDFC Standard Life Insurance, GMO Trust and IL & FS Trust were also on the list. 

The IRB InvIT owns and manages six operating road projects, aiming to provide stable yield from income-generating assets in a manner similar to REITs. IRB plans to use the proceeds to repay the assets’ outstanding debt, the road developer said last month. 

Other Indian infrastructure firms, including Reliance Infrastructure and Sterlite Power Grid, are lining up for their InvIT listings.