Capital Infra Trust, India’s latest infrastructure investment trust (InvIT) sponsored by Gawar Construction, launched its much-anticipated Initial Public Offering (IPO) on January 7, 2025. On the very first day of bidding, the IPO received a 39% subscription, reflecting the growing investor interest in infrastructure-focused investment vehicles. With the issue set to conclude on January 9, all eyes are now on the final subscription numbers and the IPO’s reception in the market.
Subscription Breakdown
The IPO saw bids for 3,46,59,300 units against a total offer size of 8,83,83,750 units, marking a 39% subscription on Day 1. According to data shared by stock exchanges, the “other investors” category—excluding qualified institutional buyers (QIBs)—registered an impressive 87% subscription.
Adding to the momentum, Capital Infra Trust raised ₹703 crore from anchor investors ahead of the IPO’s opening. This strong backing from institutional investors further bolsters the trust’s credibility and appeal.
Issue Details
Capital Infra Trust’s IPO is priced in the range of ₹99-100 per unit. It includes:
- Fresh Issue: Units aggregating up to ₹1,077 crore.
- Offer for Sale (OFS): Units worth ₹501 crore by sponsor Gawar Construction Ltd.
The combined issue size stands at ₹1,578 crore, making it one of the most prominent InvIT IPOs in recent years. Notably, it is also the first InvIT IPO of 2025, setting the tone for more infrastructure-based investment opportunities in the year.
The bidding process, which started on January 7, will close on January 9. Units of the trust will be listed on both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE), providing liquidity and accessibility for investors.
Fund Utilization
As outlined in the prospectus, the proceeds from the IPO will be directed toward two primary objectives:
- Debt Reduction: A portion of the funds will provide loans to project-specific special purpose vehicles (SPVs) to reduce their external borrowings.
- Repayment of Unsecured Loans: The IPO will also help project SPVs clear outstanding debts owed to the sponsor, Gawar Construction Ltd.
These measures aim to streamline the financial structure of the trust while enhancing its capacity to take on new infrastructure projects.
About Capital Infra Trust
Established in September 2023, Capital Infra Trust operates as an InvIT under SEBI regulations. The trust was formed to invest in infrastructure projects, with a focus on developing and managing high-quality assets in India.
Its sponsor, Gawar Construction, is a reputed name in the infrastructure sector, specializing in road and highway construction. The company has a strong track record, having executed projects for major government and semi-government bodies, including:
- National Highways Authority of India (NHAI)
- Ministry of Road Transport and Highways
- Mumbai Metropolitan Regional Development Authority (MMRDA)
- Central Public Works Department (CPWD)
Gawar Construction’s robust portfolio and strategic approach enhance the trust’s credibility, making the IPO an attractive proposition for investors seeking exposure to India’s infrastructure growth story.
Anchor Investor Participation
Ahead of the public issue, Capital Infra Trust raised ₹703 crore from anchor investors, signaling strong institutional confidence in its potential. The anchor investor allotment is seen as a vote of confidence in the trust’s ability to deliver stable returns, even in a competitive market environment.
Industry Significance
Capital Infra Trust’s IPO holds particular significance as it comes at a time when the Indian government is heavily investing in infrastructure development. InvITs like Capital Infra Trust offer a unique opportunity for investors to participate in these large-scale projects without directly owning physical assets. By pooling funds from multiple investors, InvITs allow for better risk distribution and stable income generation.
Key Highlights
- Subscription on Day 1: 39%, with strong interest from the “other investors” category.
- IPO Size: ₹1,578 crore, comprising a fresh issue and OFS.
- Price Band: ₹99-100 per unit.
- Sponsor: Gawar Construction, a leader in road and highway projects.
- Anchor Investment: ₹703 crore raised from institutional investors.
Investor Sentiment
While the 39% subscription rate on Day 1 reflects a promising start, the final outcome will depend on how retail and institutional investors respond over the next two days. With a well-defined strategy for fund utilization and a strong sponsor backing it, Capital Infra Trust is poised to generate significant interest, particularly among those seeking stable returns from infrastructure investments.
Conclusion
The Capital Infra Trust IPO marks a major milestone for India’s infrastructure sector as it becomes the first InvIT IPO of 2025. With a solid foundation in place and clear objectives for its fund deployment, the trust is expected to play a pivotal role in the country’s infrastructure development journey. Investors now await the closing of the IPO on January 9 to see how the market fully responds to this opportunity.
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