Investments in infrastructure up by 25% in 2019, highest since 2016

Investments in Indian infrastructure increased by around 25 per cent to $ 28.74 billion in 2019, highest since 2016. Sale of Sadbhav Engineering’s nine road projects lead the investment flow in 2019. In 2018, the sector attracted $22.91 billion.

However, number of deals dropped to 58 from 64, according to Inframation, an Acuris company, data.

Sale of Sadbhav Engineering’s nine road projects for $ 993.5 million to an infrastructure investment trust (InvIT) backed by Canada Pension Plan Investment Board (CPPIB) was India's biggest infrastructure M&A deal in 2019. The deal also underscores investor interest in the country's roads sector.

Of the total amount, the energy sector had received 31 per cent, while power and transport attracted 25 per cent and 24 per cent, respectively. 

Compared with 2018, when renewable energy attracted the highest share of investments at 35 per cent, deal closures proved to be a challenge in 2019 with the segment attracting just 18 per cent of the total investments. The sector is likely to receive a boost in 2020.

Complementing the investments into different sectors, infrastructure investment trusts (InviTs) received a boost with their number going up to eight from one in 2018. More infrastructure trusts are likely to be set up with investors looking at InvITs as the preferred route for investments, they said in the report.

SBI Capital Markets led the financial advisors ranking by value (2 deals valued $ 8 billion) and Deloitte topped the table by deal count (3 deals worth $ 1.7 billion).

Cyril Amarchand Mangaldas led the legal advisors ranking by value and deal count, having advised on 22 deals worth $ 14.7 billion.

SBI Capital Markets topped the loans league table by value while Rural Electrification Corporation (REC) ranked the first by deal count. JP Morgan topped the bond arrangers league table by both value and deal count (8 deals valued $ 0.52 billion).