PowerGrid InvIT Rises 4% Over IPO Price On Stock Market Debut
Shares of PowerGrid InvIT gained on market debut after non-institutional investors and qualified institutional buyers piled into the Rs 7,735-crore initial public offering.
The stock debuted at Rs 104 apiece on the BSE, a premium of 4% over its issue price. It, however, pared some of its gains to trade at 103.76 thereafter.
The IPO, which ran from April 29 to May 3, was subscribed 4.83 times. The issue was priced at Rs 99-100. It included fresh issue of units worth Rs 4,993.48 crore, while the rest was an offer-for-sale. The InvIT will use the proceeds to provide loans to the initial portfolio assets for repayment or pre-payment of debt.
PowerGrid InvIT is set up to own, construct, operate, maintain and invest in power transmission assets in India. Its sponsor, PowerGrid Corp. of India Ltd., is a central public sector enterprise under the Ministry of Power, and is listed on the BSE and NSE.
The InvIT can capitalise on opportunities to increase power transmission capacity by utilising its existing right of way since developing new lines may be challenging for other entities. It, however, is a newly settled trust with no established operating history, making it difficult to accurately assess future growth prospects.