MUMBAI (INDIA): Amid mixed investor sentiment, toll road firm MEP Infrastructure Developers hopes to file initial documents in December to launch its infrastructure investment trust (InvIT), a top company official said.
The company has set a target of launching the InvIT before March 2017, MEP’s Vice-Chairman and Managing Director Jayant Mhaiskar told PTI here.
“We had initially set November as the target to file the draft red herring prospectus (DRHP) for the InvIT after we got in-principle approval from the market regulator SEBI.
“But since many things need to be sorted out, we are now hoping that we will be able to file the DRHP by December,” he said.
Asked about the size of the InvIT, Mhaiskar said, “It is difficult to determine the size at this moment as we are yet to finalise how many projects we will list.”
Also, it is crucial to see what is the appetite of the market before launching the InvIT, he added.
“As a part of InvITs, 49 per cent of the debt has to be reduced and to that extent developers can raise funds,” he said.
The company’s current debt stands at around Rs 3,000 crore.
Mhaiskar further said there is still a mixed sentiment among investors.
“We have been informally talking to the investors and trying to get the sense of their appetite and yield expectation. They are expecting returns somewhere between 10.5-12 per cent. We hope we will get a clear sense of it by December and then we will file the DRHP,” he added.
In 2014, capital market regulator Sebi allowed the launch of real estate investment trusts (REITs) and InvITs to enable companies get easier access to funds.
In April last year, MEP launched its initial public offer to raise Rs 324 crore which was mainly utilised to repay its debt.
The company currently has 18 operational projects — 14 toll collection projects in eight states, three OMT projects and one BOT project.
It also bagged six road projects on hybrid annuity model (HAM) totalling Rs 3,836.99 crore, covering 1,059.97 lane kilometers.
Source: Press Trust of India