NHAI’s Public InvIT to Widen Participation and Accelerate Monetization

In a significant boost to private participation, the National Highways Authority of India (NHAI) has announced plans to launch a public Infrastructure Investment Trust (InvIT) alongside its existing private InvIT. InvITs are one of NHAI’s three core monetisation tools alongside Toll-Operate-Transfer (ToT) and securitization through SPVs (Special Purpose Vehicles).

NHAI has already made notable strides through its private InvIT, successfully monetizing over 2,300 km of highways and raising substantial funds. Building on this momentum, the proposed public InvIT aims to diversify the investor pool, reduce concentration risk, and provide retail investors access to infrastructure assets.

Unlike private InvITs, which require a minimum investment of ₹25 crore and 25,000 units, public InvITs have a minimum ticket size of just ₹10,000 to ₹15,000 and a single trading unit, making them retail-friendly.

NHAI stated that this step is aimed at developing a competitive InvIT market, mitigating risks of investor concentration, and creating a stable long-term funding ecosystem.

For the fiscal year 2025-26, NHAI has identified 24 road assets covering 1,472 km for monetization, expecting an annual revenue of ₹1,863 crore. These will be packaged into three ToT bundles each quarter:

1. Small bundle: ₹2,000 crore
2. Medium bundle: ₹5,000 crore
3. Large bundle: ₹9,000 crore

Additionally, NHAI will conduct 1–2 InvIT tranches annually, allowing flexibility for different investor classes.

To attract consistent private participation, NHAI is creating a comprehensive asset register. This register will classify assets based on:

1. Age and location
2. Revenue generated and its historic growth
3. Attractiveness rating: High, moderate, potential, or low revenue-per-km

This will include all technical and financial data to assess monetisation potential. NHAI also assured that risk exposure for concessionaires will be capped, improving the risk-reward profile and making road investments more appealing.

The NHAI is also revisiting how it handles the Initial Estimated Concession Value (IECV) for ToT bundles. In 2020, NHAI stopped disclosing the IECV amount to avoid bid convergence. However, stakeholders pushed back, emphasizing the need for transparency. While NHAI began disclosing the valuation assumptions, it now plans to make the IECV process more transparent, responding to long-standing industry concerns.

NHAI’s proposed public InvIT marks a significant shift in infrastructure financing by opening access to retail investors and promoting public participation in national development. With a roadmap for structured asset bundling, risk-managed investments, and an investor-friendly regulatory framework, the NHAI aims to make infrastructure an accessible asset class for all.