This infrastructure investment trust wants to raise ₹5,000cr via IPO
What's the story
Cube Highways Trust, a leading infrastructure investment trust in India, has begun roadshows for its initial public offering (IPO). The company is looking to raise ₹5,000 crore through the IPO. The offer will be an offer-for-sale by existing unitholders. The move comes after a period of growth for the platform and is part of its plan to expand its investor base.
Growth trajectory
About Cube Highways Trust
The trust has a market capitalization of around ₹20,400 crore. The trust manages an asset portfolio worth ₹36,520 crore across 27 highway and toll road projects in 12 Indian states. It works on the public-private partnership model with central and state governments. Before its listing, Cube plans to add four more road projects to its network.
Strategic move
Shift from private to public trust
The shift from a privately listed infrastructure investment trust to a public trust is aimed at widening the investor base. Currently, institutional participation from mutual funds and insurance companies in private trusts is limited by local regulations due to liquidity requirements. However, moving to a public structure would allow these domestic funds to buy stakes, thereby expanding the investor base.
Unitholder details
Unitholders and advisors for the transaction
The unitholders looking to sell their stakes in Cube Highways Trust include sponsor group entities such as Cube Highways and Infrastructure II, Cube Highways and Infrastructure III, and Cube Mobility Investment. Other unitholders include Canadian infrastructure major BCI and Abu Dhabi's sovereign wealth fund Mubadala Investment Co. Kotak Mahindra Capital Company, HDFC Bank, HSBC Securities & Capital Markets India Pvt Ltd, and JM Financial Ltd are advising on the transaction.