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PowerGrid InvIT IPO to open on Apr 29 at Rs 99-100 price band

This is the first time a PSU in the power sector will monetise its assets through the InvIT model.

PGlnvlT, the infrastructure investment trust (InvIT) sponsored by state-run electricity transmission utility Power Grid Corporation of India (PGCIL), will open the initial public offer (IPO) of the platform on April 29, at a price band of Rs 99 to Rs 100. There will be fresh issue of Rs 4,993.5 crore and offer for sale for another Rs 2,741.5 crore. The offer closes on May 3, 2021.

PGCIL is seeking to monetise some of its transmission assets through PGInvIT, which will contribute to the government’s asset monetisation programme. The special purpose vehicles constituting PGInvIT are PowerGrid Warora, PowerGrid Jabalpur, PowerGrid Vizag, PowerGrid Parli and PowerGrid Kala Amb. The Cabinet had approved the monetisation of PGCIL assets through InvIT in September 2020.

PGCIL’s chairman and managing director K Sreekant said on Monday as many as 18 other transmission projects worth Rs 22,500 crore being built by the company through the tariff-based competitive bidding (TBCB) route could also be monetised in due course through PGInvIT.

The proceeds from the offer will be used to clear the debts accrued by the assets being monetised. “Bids can be made for a minimum lot of 1,100 units and in multiples of 1,100 units thereafter by bidders other than the units subscribed for by anchor investors,” the company said.

This is the first time a PSU in the power sector will monetise its assets through the InvIT model. All assets under PGInvIT 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.

The lead managers to the IPO are ICICI Securities, Axis Capital, Edelweiss Financial Services and HSBC Securities and Capital Markets India. The PGInvIT shares are proposed to be listed on the BSE and the NSE.

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