Infrastructure Investment Trusts (InvITs) have emerged as a critical tool in India’s financing ecosystem, especially for the road and highways sector which requires massive capital but offers limited immediate liquidity. For investors, InvITs present an opportunity to participate in long-term infrastructure growth while generating predictable yields.
The Anantam Highways InvIT IPO, opening on 7th October 2025, is positioned at the intersection of India’s robust road development pipeline and the government’s push for public-private partnership (PPP) models like Hybrid Annuity. Anantam Highways InvIT IPO review goes beyond IPO dates and price details — it is designed to give you a deep understanding of Anantam’s business model, revenue architecture, and sustainability of cash flows.
By the end of this Anantam Highways InvIT IPO analysis, you will clearly understand:
- How Anantam Highways InvIT generates money under the Hybrid Annuity Model (HAM).
- Why its revenue is annuity-driven and inflation-linked rather than traffic-dependent.
- The financial health and turnaround trajectory of its SPVs.
- The opportunities and risks investors should weigh before subscribing.
In essence, this is not just an IPO update but a comprehensive case study of an annuity-based infrastructure investment vehicle in India.
Table of Contents
Background of Anantam Highways InvIT
The Anantam Highways Trust was established on 24 July 2024 and registered with the Securities and Exchange Board of India (SEBI) on 19 August 2024 as an InvIT. It is sponsored by Alpha Alternatives Fund Advisors LLP, part of Alpha Alternatives Holdings, a multi-asset strategy firm with exposure across infrastructure, real estate, credit, and commodities.
At the time of IPO, Anantam’s initial portfolio comprises seven road project SPVs, totaling 271.65 km (1,086.6 lane km) spread across five states and one union territory:
- Dhrol–Bhadra (Gujarat, 50.45 km)
- Dodaballapur–Hoskote (Karnataka, 38 km)
- Repallewada (Telangana, 52.6 km)
- Viluppuram–Puducherry (Tamil Nadu + Puducherry, 29 km)
- Narenpur–Purnea (Bihar, 47.4 km)
- Bangalore–Malur (Karnataka, 27.1 km)
- Malur–Bangarpet (Karnataka, 27.1 km)
All projects are developed under the Hybrid Annuity Model (HAM) with the National Highways Authority of India (NHAI) as the concessioning authority. Each SPV has a 17-year concession period (2 years construction + 15 years operation). As of 30 June 2025, the residual concession life stands at 12.65–13.42 years, ensuring long-term annuity inflows.
A few key features that set this InvIT apart:
- COD/PCOD Achieved: Most assets are already operational with fixed cash inflows.
- Revenue Model: Cash flows come primarily from annuities, interest, and O&M reimbursements by NHAI, eliminating traffic risk.
- Scale: INR 2,020 crore in operating revenue for Q1 FY26 and turnaround profitability in FY25.
- Debt Reduction Plan: INR 376 crore of IPO proceeds earmarked for debt repayment at SPV level.
In short, Anantam Highways InvIT is not a toll-based risk-heavy play but a government-backed annuity-based infra yield trust, aiming to provide stability and predictable cash flows to investors.
Anantam InvIT IPO Review: Business Model
The strength of Anantam Highways InvIT lies in its choice of operating under the Hybrid Annuity Model (HAM), which has become the preferred mode of Public-Private Partnership (PPP) in India’s road sector since its introduction in 2016. Unlike traditional BOT (Build-Operate-Transfer) or Toll-based models, HAM eliminates the volatility associated with traffic and toll revenues.
Here’s how the HAM-based model works for Anantam’s SPVs:
- Government Funding (40%): NHAI funds 40% of the project cost during the construction phase, easing capital requirements for developers.
- Developer Financing (60%): The remaining 60% is financed by the developer (through equity + debt). This debt is later refinanced through InvIT proceeds.
- Fixed Annuity Payments: Once operational, NHAI pays semi-annual annuities over the concession period, creating stable, predictable inflows.
- Inflation-linked Returns: Payments include annuities, O&M charges, and interest, with adjustments linked to inflation indices like WPI/CPI and benchmark MCLR.
Significance for Investors:
- No Traffic Risk: Unlike toll roads where revenues fluctuate with traffic volumes, here the revenue is contractually guaranteed by NHAI.
- Hedge Against Interest Rate Volatility: Concession agreements ensure interest on the reducing balance of completion cost is paid at either MCLR + 1.25% or 3% above bank rate, offering a natural hedge.
- Stable Long-Term Concessions: Each project comes with a 15-year operational period, with residual life of 12–13 years, giving visibility of cash flows.
Effectively, this InvIT functions less like a speculative equity bet and more like a yield-generating debt instrument with equity upside through portfolio expansion.
Anantam Highways Invit IPO Analysis: Revenue Streams Breakdown
The Anantam Highways InvIT’s income model can be divided into three distinct streams:
1. Annuity Inflows (Core Revenue)
- Paid bi-annually by NHAI as per concession agreements.
- Covers repayment of developer-financed portion of the project cost.
- Provides the bulk of the InvIT’s stable revenues.
- Example: In FY25, out of INR 942.36 crore in total income, a major portion came from annuity receipts, ensuring positive cash flow turnaround.
2. Interest Income on Balance Completion Cost
- NHAI pays interest on the reducing balance of completion cost (BCC).
- Linked to MCLR + 1.25% or bank rate + 3%, updated periodically.
- Protects the SPVs from rising interest costs and provides inflation-linked cash flows.
- Q1 FY26 data already shows a net margin of ~33%, proving how this model cushions financing risks.
3. O&M Reimbursements & Margins
- DBL (Dilip Buildcon), the original EPC contractor, continues as the O&M contractor for these SPVs.
- O&M charges are reimbursed by NHAI under concession terms.
- The Trust earns a margin over these O&M operations, creating a steady ancillary revenue line.
- DBL’s experience in highways (15 completed road projects, multiple tunnels/airports) ensures operational efficiency and lower execution risk.
Data Snapshot: Revenue Evolution
- FY23: INR 2,590.2 crore revenue, net loss of INR 178.5 crore (construction-heavy, debt burden).
- FY24: INR 2,525.7 crore revenue, net loss of INR 160 crore (transition year).
- FY25: Revenue INR 926.5 crore, net profit of INR 410.6 crore (reflecting operationalization of projects).
- Q1 FY26: Revenue INR 202.0 crore, net profit INR 67.9 crore, EBITDA margin ~33%.
The clear trend: as construction costs taper off and annuity inflows stabilize, the business model shifts from loss-making to annuity-yielding, validating its predictability.
Financial Performance Review
The numbers clearly reflect Anantam’s transition from construction-heavy losses to stable annuity-driven profitability.
| Metrics | FY23 | FY24 | FY25 | Q1 FY26 |
| Revenue | 2,590.22 | 2,525.69 | 926.55 | 202.04 |
| Expenses | 2,764.34 | 2,646.74 | 546.94 | 112.84 |
| Net income | (178.48) | (160.05) | 410.62 | 67.86 |
| Margin (%) | (6.89) | (6.34) | 44.32 | 33.59 |
- FY23–FY24: Heavy construction and finance costs → consistent losses.
- FY25: Turning point, with positive net profit (INR 410.6 cr) and 44% margin.
- Q1 FY26: Profitability sustained with 33.6% margin, proving annuity-driven stability.
- Cash Flows: Operating cash flows were negative in construction-heavy years, but IPO proceeds (INR 376.0 cr) earmarked for debt repayment will ease leverage pressure at SPV level.
Anantam Highways InvIT IPO Review: Growth Levers & Expansion Pipeline
Anantam’s future scalability rests on both sector tailwinds and structural rights:
- Sector Tailwinds:
- Road sector capex grew at 14% CAGR (FY18–23).
- Ministry of Road Transport & Highways budget doubled from INR 1.28 lakh crore in FY19 to INR 2.26 lakh crore in FY24.
- Projects under Bharatmala Pariyojana and NIP pipeline provide steady deal flow.
- ROFO (Right of First Offer) Agreements:
- Access to 11+ identified assets from Dilip Buildcon (DBL).
- Additional projects from Build India Infrastructure Fund and Alpha Alternatives.
- A potential pipeline of HAM-based SPVs, offering accretive acquisitions.
- Sponsor & DBL Support:
- DBL, one of India’s largest EPC contractors, ensures robust O&M performance.
- Alpha Alternatives brings asset management and capital market expertise.
This combination ensures that Anantam can scale into a multi-asset annuity platform, similar to how IndiGrid scaled in the power transmission space.
Anantam Highways IPO InvIT IPO Review: Risks to Watch
While the model is low-risk compared to toll-based InvITs, investors should note:
- Counterparty Risk – NHAI is the sole payer; any delay in annuity disbursement can affect distributions.
- High Leverage – Outstanding SPV debt of INR 3,237.4 crore (as of June 2025). IPO proceeds will reduce debt, but leverage remains material.
- Limited Organic Growth – Revenues are capped by concession terms; growth depends on acquisitions.
- Regulatory Risk – Any change in HAM framework or InvIT tax structure could impact yields.
- Concentration Risk – Current portfolio is limited to seven projects, all within one asset class (roads).
Should You Consider Anantam InvIT?
The Anantam Highways InvIT IPO review highlights that this trust positions itself as a stable yield play rather than a speculative growth bet.
- Key Points to Note:
- Predictable, inflation-linked annuity inflows.
- Traffic risk fully mitigated (NHAI counterparty).
- Strong turnaround to profitability in FY25, sustained margins in FY26.
- Debt reduction through IPO proceeds strengthens cash flow for distributions.
- Access to future pipeline via ROFO agreements.
For investors seeking steady cash yields with moderate growth potential, Anantam InvIT offers a compelling case. It is more akin to a fixed-income style investment with upside from future asset acquisitions. Conservative investors looking for stability, predictable annuities, and a hedge against interest rate volatility should find this InvIT suitable.
For more details related to IPO GMP, SEBI IPO Approval, InvIT, REITs and Live Subscription stay tuned to IPO Central. (edited)