Bharat Highways InvIT Subdued Listing: At 1% Over IPO Price, The Company Makes A Subdued Entry On Exchanges

Today marked the quiet launch of Bharat Highways Infrastructure Investment Trust (InvIT) on the stock markets. The infrastructure investment trust debuted on the market with an IPO to collect Rs 2,500 crore, and it was listed on the National Stock Exchange (NSE) for Rs 101.10 per share, a little 1.1% premium over its issue price of Rs 100.

The grey market premium (GMP) for Bharat Highway InvIT has decreased, according to industry watchers. The initial public offering (IPO) witnessed little interest in the pre-listing market and was only slightly overpriced at Rs 2 per share, suggesting a small listing pop.

Strong subscription numbers were seen for Bharat Highways InvIT’s IPO, which received 8.02 times as many subscriptions on the last day of the bidding process. Against the offer size of 10.3 crore units, investors purchased 82.53 crore units. While non-institutional investors subscribed 6.93 times their allocated part, institutional investors showed strong interest by oversubscribing by 8.91 times.

Up to 25,00,00,000 brand-new shares were offered for sale during the IPO, which took place between February 28 and March 1 and had a price range of Rs 98 to Rs 100 per unit. Project SPVs (special purpose entities) will receive loans from the net proceeds of the initial public offering (IPO), which will only include a fresh issue component. These loans will be used to repay existing debt, together with any accumulated interest and prepayment penalties. The remainder of the money will be used for basic business needs.

KFin Technologies was the registrar for the IPO, while the lead managers were ICICI Securities, Axis Capital, HDFC Bank, and IIFL Securities.

In accordance with SEBI InvIT Regulations, Bharat Highways InvIT was founded as an infrastructure investment trust to purchase, oversee, and invest in a portfolio of infrastructure assets in India. Transportation engineering testing services are the focus of Aadharshila Infratech, the trust’s sponsor. Aadharshila Infratech contributes invaluable experience to the infrastructure industry with its competence in NSV survey, FWD survey, pavement design of roads and airports, physical and chemical testing of soil, lime, and cement, road roughness testing, and concrete and bituminous mix design of road projects.

Bharat Highways InvIT reported revenue of Rs 388.54 crore and profit after tax of ₹101.35 crore for the quarter ended in September 2023. With sales of Rs 1,537.47 crore, the company’s fiscal year ended March 31, 2023, with a strong profit margin of Rs 527.05 crore. These numbers demonstrate Bharat Highways InvIT’s sound financial standing and provide investors an idea of the trust’s impressive track record.

Many investors are looking forward to Bharat Highways InvIT’s post-listing trajectory as they take in the muted listing performance. There are concerns over the current market’s perception of the trust given the quiet launch and little premium on the gray market. Experts in the field contend that long-term outlooks might provide a more realistic evaluation of Bharat Highways InvIT’s potential.

Investors should exercise caution, according to market experts, who also stress the need of keeping an eye on the trust’s performance in the next weeks. Bharat Highways InvIT is still well-positioned for expansion thanks to a sizable subscription during the initial public offering (IPO) phase and a solid portfolio of seven road assets.