The public issue of PowerGrid Infrastructure Investment Trust was subscribed 61% on Friday, the second day of the bidding.
The issue received bids for 25.82 crore equity shares against the issue size of 42.54 crore shares, according to stock exchange data.
The portion of the share sale reserved for qualified institutional investors was sub- scribed 38% on day two, while that reserved for non-institutional investors was subscribed 88%.
PowerGrid plans to raise nearly ₹7,735 crore via the public issue by issuing fresh shares worth ₹4,993.48 crore and an offer for sale of units held by PowerGrid worth ₹2,741.50 crore. The issue will close on 3 May.
“We are sanguine on PG Invit’s business model, which is backed by predictable cash flows and offers growth visibility. A Government backed sponsor like PGCIL further instills confidence”, said brokerage firm Nirmal Bang in a report to its clients.
“PG InvIT is AAA rated and at the issue price of Rs. 100 per unit, offers 12.0% yield, trading at a spread of 600 bps to the 10 year G-sec (6.0%). In our view, such a spread is very attractive given the high degree of certainty of cash flows & distribution per unit going forward,” Nirmal Bang report added.
The brokerage expects ₹3 a unit per quarter dividend and 20-30% listing gains. Upon listing Nirmal Bang expects the yields to settle between 9-10% in line with that of the existing listed Invit of Indigrid; which translates to the Unit price settling in the range of Rs120-130.
Powergrid Infra InVIT is the first InvIT from a public sector undertaking (PSU)
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