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Cube Highways Trust IPO Day 1: The initial public offering (IPO) of Cube Highways Trust, an infrastructure investment trust (InvIT), is in focus in today's trading session as the issue opened for subscription today. The IPO has received a lukewarm response so far.
Cube Highways Trust IPO subscription statusAs of 11:15 am, the IPO had received bids for only 12,19,800 shares against 13,65,89,480 shares on offer. The subscription was primarily driven by the "Other Investors" category, including corporates, NRIs, and HUFs. Meanwhile, the Qualified Institutional Buyers (QIB) category had not received a single bid at that time.
Cube Highways Trust IPO GMP
Reflecting the subdued subscription response, investor interest in the grey market also remains flat. The Grey Market Premium (GMP) stands at Rs 0, indicating that if the GMP remains unchanged until listing, the IPO is likely to list at its issue price of Rs 152 per unit.
The IPO's GMP has remained at Rs 0 consistently since July 15.
Cube Highways Trust InvIT, which opened its three-day subscription window today, will close the issue on July 22.
Following the three-day subscription period, the IPO allotment is expected to be finalised on July 29.
The units are expected to be listed on both the NSE and BSE on July 29, subject to the completion of the allotment process.
About Cube Highways Trust IPO
Cube Highways Trust InvIT is a book-built issue worth Rs 5,000 crore. The company has fixed the price band at Rs 151-Rs 152 per unit. The minimum application size is 95 units.
Kotak Mahindra Capital Co. Ltd. is the book-running lead manager, while KFin Technologies Ltd. is the registrar to the issue.
Should you subscribe to the Cube Highways Trust IPO?
As the IPO entered its first day of subscription, brokerage firm SMIFS Limited reiterated its "SUBSCRIBE" recommendation, citing the InvIT's diversified road portfolio, consistent distribution track record, strong balance sheet, and visible growth pipeline.
The brokerage highlighted the following pros and cons:
Pros: The InvIT offers a diversified road portfolio, a AAA-rated balance sheet, a consistent distribution track record, and a visible acquisition pipeline through committed and Right of First Offer (ROFO) assets that could support future growth.
Cons: Since the issue is a pure Offer for Sale (OFS), no fresh capital will flow into the Trust. Investors also face risks from traffic fluctuations, changes in toll policies, concession renewals, and dependence on NHAI annuity payments. In addition, future distributions will depend on the Trust's cash flow performance.
(Disclaimer: The above article is meant for informational purposes only and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money-related decisions.)
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