Sterlite may launch InvIT IPO in second week of May

The initial public offer of Sterlite Power Grid Ventures infrastructure investment trust (InvIT) is likely to hit the markets in the second week of May to raise Rs 2,650 crore.
The India Grid Trust sponsored by Sterlite Power Grid Ventures and Sterlite Infraventures is expected to file its final IPO papers with the market regulator Sebi today, official sources told PTI here.
"The trust is likely to launch its initial public offer (IPO) in the second week of May and is targeting to raise Rs 2,650 crore," they added.
If all goes well, India Grid Trust would become the second trust after IRB InvIT Fund, which will launch its IPO on May 3, to hit the markets in less than a month.

India Grid Trust (IndiGrid) will house two power transmission projects, namely, Bhopal Dhule Transmission Company (BDTCL) and Jabalpur Transmission Company (JTCL).
The trust plans to utilise the proceeds raised through this IPO for providing loans to BDTCL and JTCL for repayment or pre-payment of debt of banks, financial institutions, Sterlite Grid 1, Sterlite Grid 2 and repayment of any other long term and short term liabilities and general purposes.

IndiGrid has proposed to utilise an estimated amount of Rs 2,580 crore from the net proceeds to provide loans to BDTCL and JTCL, by entering into facility agreements.
Further, BDTCL and JTCL, will utilise the funds raised through such loan towards partial repayment or pre-payment of debt.

The move will help reduce outstanding indebtedness of IndiGrid, on a consolidated basis, assist it in maintaining a favourable debt-equity ratio, which will enable the trust to raise further resources in the future to fund potential business development opportunities and plans to grow and expand its business in the future, the draft red herring prospectus of India Grid Trust said.
In case the issue is over subscribed, the proceeds from such over-subscription may be utilised for repayment of debt from the sponsor, it added.
The issue is being managed by Morgan Stanley India Company, Citigroup Global Markets India and Edelweiss Financial Services. The units of IndiGrid are proposed to be listed on BSE and NSE.