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KKR Targets India's Infrastructure Potential

Editorial Staff

30 August 2022

, has launched the Highways Infrastructure Trust, aimed at the India market. The move is another example of how investment firms are eyeing the potential of the Indian economy.

The trust is the firm’s third such InvIT structure in India, adding to the Virescent Renewable Energy Trust, India’s first renewable energy InvIT, and India Grid Trust, a transmissions InvIT.

Together, these platforms operate and manage 33 assets valued at over $3.8 billion in 22 states or union territories across India, KKR said in a statement yesterday. 

HIT’s initial portfolio comprises six roads' assets with a total length of more than 450 kilometres across six states in India. The assets, which include a mix of toll and annuity roads, are located in Gujarat, Madhya Pradesh, Meghalaya, Rajasthan, Tamil Nadu, and Telangana.

In addition, HIT is considering a pipeline of acquisition targets, including those sold through its sponsor. The platform possesses significant growth potential and seeks to invest in high-quality assets, including through bolt-on acquisitions.

HIT has been assigned a ‘Provisional AAA/Stable’ rating for its loan facilities from CRISIL, S&P’s India affiliate. KKR said the rating reflects the assets’ favourable location and geographical diversity, as well as strong track record of revenue.

The launch of the trust is taking place on the back of growing demand to expand India’s road network, the second-largest globally, as passenger traffic and commercial vehicle traffic continue to increase, KKR said. Today, India’s road network is responsible for 90 per cent of total passenger traffic and the movement of almost 65 per cent of all goods across the country.

Among others, globally, KKR’s infrastructure portfolio, which spans sectors including transportation, renewable energy, power and utilities, water and wastewater, and elecommunications, manages more than $40 billion in assets.

Within the wealth management space, in January KKR appointed one of its senior figures as global head of private wealth. Todd Builione oversees the firm’s “strategic priority” of building its private wealth distribution platform to expand access to KKR’s alternative investment strategies for individual investors globally.