
CareEdge Ratings projects strong growth for India’s road sector Infrastructure Investment Trusts (InvITs), forecasting a 37% rise in assets under management (AUM) by FY26. AUM is set to climb from ₹2.4 lakh crore to ₹3.27 lakh crore, powered by aggressive monetisation of National Highway (NH) Hybrid Annuity Model (HAM) projects and mature toll assets.
As of September 2024, the total InvIT AUM across sectors reached ₹5.87 lakh crore, with roads making up 35%. The segment includes 167 road assets spread across 13 InvITs, with HAM assets forming a significant share due to increasing investor interest.
Over the last seven years, ₹70,000 crore worth of NH-HAM assets have been monetised, generating ₹11,500 crore for sponsors. Despite this, newer HAM projects awarded post-FY23 may face valuation challenges due to tighter margins, higher leverage, and increased risk perception.
CareEdge sees monetisation potential of ₹2 lakh crore between FY25 and FY27, though investor appetite and asset quality will be key watchpoints moving forward.