The launch of Highways Infrastructure Trust (HIT) is the third in a series of KKR investment initiatives in India that together operate and manage 33 assets valued at over $3.8 billion.
The focus is three-pronged across transportation, renewables and power. The existing investments are across HIT, Virescent Renewable Energy Trust, India’s first renewable energy InvIT, and India Grid Trust. The investments span across 22 states or union territories across India.
KKR’s expansion in India takes place amid growing demand on the country’s road network as passenger traffic and commercial vehicle traffic continue to increase. India’s road network is the second largest in the world and is responsible for 90% of total passenger traffic and the movement of almost 65% of all goods across the country.
In the Asia Pacific region, KKR takes a flexible approach to infrastructure investment and combines local knowledge and capabilities with the firm’s global industry and operational expertise. Globally, KKR’s $40 billion infrastructure portfolio spans a broad range of sectors including transportation, renewable energy, and power and utilities, water and wastewater, and telecommunications.
“HIT’s launch is a significant milestone for KKR’s India infrastructure strategy as we deepen our presence in the market,” said Hardik Shah, partner at KKR in a statement. “Highways and roads play a critical role in driving India’s economic prosperity and connecting its citizens, and we look forward to enabling further infrastructure creation and expansion as transportation demands continue to grow. With our dedicated platforms across transmissions, roads, and renewables in place, KKR is well-positioned to collaborate with sellers in the private markets and the government through the National Monetisation Pipeline on attractive investment opportunities.”
HIT’s initial portfolio comprises of six roads assets with a total length of more than 450 kilometers across six states in India. The assets, which include a diversified mix of toll and annuity roads, are located in Gujarat, Madhya Pradesh, Meghalaya, Rajasthan, Tamil Nadu, and Telangana. Officials said they are also considering a pipeline of acquisition targets, including through its sponsor. The platform possesses significant growth potential and seeks to invest in high-quality assets, including through bolt-on acquisitions, according to KKR.
Since setting up its Mumbai office in 2009, KKR has made more than 20 investments in India with more than a dozen active portfolio companies today.