IRB Infra planning to transfer Rs 2,500 cr assets to public InvIT

Mumbai: IRB Infrastructure Developers is planning to transfer assets worth ₹2,500 crore to a public infrastructure investment trust - InvIT - by the end of this fiscal year, its top executive said.

The InvIT will help the highway infrastructure developer unlock capital deployed in these projects, said chairman and managing director Virendra D Mhaiskar.

"To facilitate our strategy to achieve sustainable growth, we intend to churn assets and unlock value to fund future projects. To achieve this, we intend to offer eligible assets to a public InvIT at regular intervals going forward," Mhaiskar said during an analyst call after the company's fourth quarter results announcement on Wednesday.

This will put IRB on a self-sustaining growth trajectory and the company will submit a concept paper to the public InvIT management soon on the proposal, he said.

After their review, "we will try to reach out to all stakeholders to enlighten them about the opportunity and seek their views as well," he added.

The company will unveil a concept paper next month, following which the consultation with investors will take place.

InvITs allow investors to make small investments and receive a regular income. They are considered stable cash-generation assets and are popular with pension funds globally.

IRB Infra has debt of ₹13,800 crore, an EPC (engineering, procurement and construction) order book of ₹10,500 crore and O&M (operation and maintenance) order book of ₹5,500 crore.

The company reported total consolidated income of ₹1,683 crore in the fourth quarter, up 2% from the corresponding period. Consolidated toll revenue increased to ₹510 crore from ₹488 crore in the year-ago quarter.

The company's consolidated construction revenue increased to ₹1,173 crore, from ₹1,162 crore, while operating profit rose to ₹891 crore from ₹805 crore, a growth of 11%.

In April, IRB Infra raised ₹243 crore in the IRB Infrastructure Trust by way of a rights issue. IRB Infra invested ₹124 crore, corresponding to its 51% shareholding in the Trust, while Singapore's GIC Affiliates invested ₹119 crore for a 49% stake.

After the fundraise, IRB and GIC Affiliates will continue to hold 51% and 49%, respectively, in IRB Infrastructure Trust.