IRBINVIT — earnings call

The transcript as filed. Every paragraph is addressable: its link names the page and the position it sits at in the call.

Prepared remarks

IRB InvIT Fund

Transcript of 6thAnnual General Meeting (AGM) of IRB InvIT Fund (“Trust”) held on

July 26, 2023 at 11:00 am (IST) through Video Conferencing (“VC”)

Welcome address by the Chairman:

Good morning, to all the unit holders, I welcome you all to the 6th Annual General Meeting of

the IRB InvIT Fund which is being held through video conference.

Let me at the outset introduce my colleagues on the Board of Investment Manager, Mr.

Kumar Menon, Whole-time Director and CEO, Mr.

Rushabh Gandhi, Executive Director and

Chief Financial Officer, Mr.

Sunil Tandon, Independent Director, Mr.

Independent Director and Ms.

Anusha Date, Independent Director.

I would also like to welcome Mr.

Virendra Mhaiskar, CMD of the sponsor, IRB Infrastructure

Developers Limited and Mr.

Anil Yadav, Director, Investor Relation of IRB Infrastructure

Developers Limited.

The Trust has enabled the unit holders to participate in the 6th AGM through video conference

facility, which is provided by the NSDL, proceedings are being webcast live for all the unit

I will declare the meeting in order.

The Notice and auditor report along with the

Audited Accounts are with the permission of the Unitholders, considered as read.

Let me now share with you the performance highlights of financial year 2022-23.

projects being handed back to NHAI after completion of the concession period, the Trust has

been able to maintain distribution of more than Rs. 8 per unit.

This aggregates to 58.35 rupees

per unit since its listing in 2017.

During financial year 2022-23, the Trust added a new asset which is Vadodara Kim Package-

1 to our portfolio.

This stretch is part of the prestigious Delhi Mumbai Greenfield

The addition being a Hybrid Annuity Project shall bring revenue stability and

visibility to the Trust and returns to the unit holders.

Incidentally, since we acquired this

project on 15th of October, we have already received two annuities amounting for Rs. 186

crores which comes to ~ 13% of the total revenue of the financial year 2022-23.

Our endeavour would be to continue to acquire assets to the portfolio which can result in

steady cash flows.

To achieve this, the Trust has already started participating per our

investment policy in various deal processes initiated by the sellers in the secondary market.

Considering that our current net debt to value of assets ratio is below 0.3:1, our appetite

remains robust in terms of acquiring new assets.

In order to encourage best-in-class practices, the Trust has adopted various policies like Risk

Management Policy, Succession Policy, Familiarization Policy for Independent Directors, and

other Good Governance policies.

During the year the Trust also subscribed to the Funded Gratuity Scheme of LIC for the

benefit of the employees.

The Trust continues to enjoy AAA rating for its debt.

The newly added HAM asset also

enjoys AAA rating.

Hopefully the interest rates have peaked and the likely downward trend in

future would reduce the interest burden for the Trust debt.

I would once again like to thank all the stakeholders, all the unit holders for partnering the

efforts across the projects.

I would also like to thank our sponsors, project managers, staff and

vendors and again express sincere gratitude to all the unitholders for their continued support.

I would now request the Company Secretary to brief the unit holders about the arrangements

which we have made for the meeting.

Company Secretary

Thank you, sir.

The Unitholders are provided a facility to exercise their right to vote by electronic means,

both through remote e-voting and e-voting at the AGM as per SEBI circulars.

Unitholders joining the meeting through video conferencing, who have not already cast their

vote by means of remote e-voting, may vote through insta-poll e-voting facility provided at

KDA & Associates, Practicing Company Secretaries are appointed as the

With the permission of Chairman Sir, Instapoll is active now and the same will be disabled 15

minutes after the termination of this AGM.

The result of e-voting and Instapoll will be

announced on or before July 28, 2023.

With the permission of the Chairman Sir, I request the moderator to open the Q&A session.

the interest of time, we will aggregate the questions / comments from all speakers and reply to

The following items of business as set out in the Notice were put to vote by remote e-voting

and e-voting during the Annual General Meeting:

To consider and adopt the Audited Standalone Financial

Statements as at and for the Financial Year ended March 31,

2023 together with the report of the Auditors thereon and

report of the Investment Manager and Management

Discussion & Analysis

To approve and adopt the Valuation Report of the Trust

Sundararaman along with the Review

Opinion of DHC International Private Limited (formerly

known as Baker Tilly DHC Business Private Limited), an

Independent advisor for the year ended March 31, 2023

To Consider and appoint the Valuer

Question and Answer

Some unitholders have raised few questions / queries some of which were answered by the

Chairman and rest were answered by Executive Director & CFO.

Following is the summary

What is the overall tariff increase in all projects and expected revenue growth for financial

Reply: With regards to the tariff growth, four of our projects received tariff rate revision of

around 10% which was effective from April 1, 2022 i.e. for financial year 2022-23.

Omalur-Salem project, we have received tariff rate revision of around 15% effective from 1st

September, 2022.

So, on the backdrop of this tariff revision and robust traffic growth, the

overall toll revenue increased by almost 23% on a portfolio level in financial year 2022-23.

And for the current financial year, four of our projects received tariff revision of ~5%

effective from April 1, 2023.

So considering the tariff revision and expected traffic growth,

we expect the toll revenue to grow in line with valuation report i.e. around 10% to 11% for

Financial Year 2023-24.

What is the outstanding debt on trust books?

Reply: The outstanding debt on consolidated basis is around Rs. 2,500 crores which includes

Rs. 950 crores of the newly acquired HAM asset as well.

What is the cash and bank balance as on March 31, 2023?

Reply: The cash and bank balance, as on March 31, 2023, was around Rs. 220 crores which

includes Rs. 55 crores of DSRA FD also.

How many annuities received till date in case of Vadodara Kim HAM project?

Reply: Chairman Sir responded to the aforesaid question by stating that two annuities for the

HAM project which we have acquired last October.

What is expected distribution for the Trust for the financial year 2023-24?

Reply: The Trust has on cumulative basis distributed around Rs. 3,400 crores which is more

57% of the value of unit capital issued at the time of IPO.

On per unit basis, it comes to

around Rs. 58, and for the current fiscal year, we expect around Rs. 8 per unit to be

distributed to unitholders which will subject to the actual toll collection.

Any plan to acquire new assets in the near future?

Reply: During last year, we have already acquired Vadodara Kim asset which is a part of

prestigious Delhi-Mumbai Expressway.

So, along with this acquisition, we had evaluated

other opportunities also, however based on the assets selection criteria, we could not proceed

with those acquisitions but we will continue to evaluated third party assets also.

Then the Chairman requested Mr.

Virendra Mhaiskar, CMD & Representative of Sponsor to brief on

the activities in the sector & future possibilities.

Sponsor’s representative- Mr.

Virendra Mhaiskar:

Good morning all stakeholders, it is a privilege to attend this 6th Annual General Meeting of

IRB InvIT Fund which was the first fund to get listed 6 years back and it has been a great

As regards your question on adding the new asset is concerned as Singh Sir said we already

added one HAM project in the last financial year.

We as sponsors have an obligation to offer

any project that we decide to sell in future from the IRB’s stable, and as you know we have

three other HAM projects which the company is executing at this point in time.

completion of these projects and they become eligible, these HAM projects will certainly, I

would say, a visibility that as a sponsor, we can offer to Trust in terms of acquiring and

growing its book.

As regards the team’s endeavour goes in terms of looking out for independent opportunities, I

think the team has been doing a splendid job of evaluating things, though it is not a very easy

idea to find an asset which will generate significant amount of returns for its unit holders

because the seller expectations are also pretty high.

But at the same time, as regards our own

commitment to the fund is concerned, we certainly have 3 HAM projects which will get

offered to the Trust at the opportune time.

So, these 3 projects which the company is

executing are likely to be completed over the next 2 years and as we complete those projects,

these 3 projects entailing a total enterprise value of almost Rs. 4,000 crores will become an

available pool for the Trust to evaluate and see if they would want to dip into those.

a certain visibility which I can offer and again as I said the InvIT management has also been

evaluating independent project opportunities which they will be able to brief you better on.

Whole-time Director & CEO:

Now, I propose a vote of thanks to the Directors, the trustee, the CMD of the Sponsor and all

the Unitholders of the Trust.