PowerGrid InvIT IPO aims to raise Rs 5,000 crore

PGlnvlT, the infrastructure investment trust (InvIT) sponsored by state-run electricity transmission utility Power Grid Corporation of India (PGCIL), aims to raise Rs 4,999.5 crore through the proposed initial public offer of the platform. In the draft offer document filed to the Security and Exchange Board of India (Sebi), PGInvIT said that five operational transmission lines worth Rs 7,000 crore would constitute the current asset portfolio of the trust, and the sponsor PGCIL will transfer 74% shareholding of these assets to the platform which will be up for grabs.

This is the first time a PSU in the power sector will monetise its assets through the InvIT model and use the proceeds to fund new and under-construction capital projects. The five special purpose vehicles which will be part of PGInvIT are PowerGrid Warora, PowerGrid Jabalpur, PowerGrid Vizag and PowerGrid Kala Amb.

All these assts have 35 years of transmission service agreement with their respective customers and their revenue flows are insulated from demand, supply and price fluctuation of power tariff.

As much as 75% of the offer is open for institutional investors. The government expects PGCIL’s InvIT to attract both domestic as well as global investors including sovereign wealth funds, pension funds and mutual funds.