Power Grid InvIT IPO - Dolat Capital’s Investment Rationale
Power lines hang from a transmission tower. (Photographer Carla Gottgens Bloomberg)

Power Grid InvIT IPO - Dolat Capital’s Investment Rationale

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

Dolat Capital Report

Power Grid Investment Trust is a good option for yield investors who can expect a 11-12% yield arising from stable cash flows.

The valuations indicate a price to book of 3.5 times, as compared to Power Grid Corporation of India Ltd. price-to-book of 1.6 times.

However, the InVIT has superior 20% plus return on equities compared to the average return on equity of 15% for Power Grid.

From a Powergrid perspective, the higher price-to-book of the InVIT which translates into a higher book, would mean an addition of approximately Rs 7 to its fair value.

Click on the attachment to read the full report:

Dolat Capital PGInvIT IPO Note.pdf

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