Sterlite Power Transmission Ltd (SPTL), a company that was demerged from Sterlite Technologies, has filed initial papers with market regulator SEBI for raising funds through Infrastructure Investment Trusts (InvITs) on Monday. The company has filed for InvITs through its subsidiary Sterlite Power Grid Ventures.

Likely in third quarter

The company expects the whole process to culminate by the third quarter of this financial year.

Earlier on June 3, sources had told BusinessLine that SPTL was looking to raise about ₹2,500-3,000 crore. “We have filed the initial papers with SEBI today, which will be followed by DRHP and finally the issuance, probably by Q3. We believe this is the best format to finance infrastructure,” SPTL CEO Pratik Agarwal said in an interaction.

An InvIT, much like mutual funds, enables individuals to pool in investments into the infrastructure sector and earn a return on the income (after deducting expenditures). InvITs can invest in infrastructure projects, either directly or through special purpose vehicles (SPVs). In case of public private partnership (PPP) projects, such investments can only be through SPVs.

Agarwal, however, declined to comment on the funds SPTL intends to raise, adding this would be decided only after discussing with the market.

Morgan Stanley and Edelweiss Financial Services are working with STPL on fund raising plan, while the company might also consider bringing in others depending on the size of the issue, a source said.

Utilisation of funds

“In growth economies such as India, a lot of the capital might be used for funding of projects, sometimes to reduce debt to equity levels and repay investors. We are yet to finalise how to utilise the funds,” Agarwal added.

SPTL, which is in the businesses of power products (conductors and cables) and power transmission grid, operates about eight power transmission projects and has debt of about ₹5,500 crore.

Sterlite Technologies had commenced the demerger of SPTL into an independent and unlisted entity, effective April 2015. Following the demerger, completed in May 2016, Sterlite Technologies became a telecom and integrated network provider.