NHAI resumes infrastructure investment trust project with roadshows

Source: Business Standard

What is the News?

National Highways Authority of India(NHAI) has started re-engagement with investors for its infrastructure investment trust(InvIT) which has been delayed by over a year.

What are Infrastructure Investment Trusts(InvITs)?

• InvITs are instruments that work like mutual funds. They are designed to pool small sums of money from a number of investors to invest in infrastructure assets that give cash returns over a period of time.
• Part of this cash flow would be distributed as a dividend back to investors.
• Regulated by: InvITs are regulated by the Securities and Exchange Board of India (SEBI) (Infrastructure Investment Trusts) Regulations, 2014.

NHAI InvITs:

• NHAI is planning to set up a private listed InvIT to attract large institutional investors.
• Under the trusts, NHAI will offer 19 projects worth Rs 35,000 crore. The initial projects selected for the InvIT will provide better prospects because they are part of national corridors.
• Moreover, NHAI INvIT would also see an offer for sale(OFS). The units are proposed to be listed on the National Stock Exchange and the BSE.
  • Offer for Sale(OFS) is when the promoters (owner) of a listed company sell their shares to the public. It is a transparent process that takes place on the stock exchange.