National Highways Infra Trust has received credit rating affirmation from India Ratings and Research, maintaining its 'IND AAA'/Stable rating across all debt instruments while securing ratings for new financing facilities.

Rating Actions and Instrument Details

India Ratings has taken comprehensive rating actions on National Highways Infra Trust's debt portfolio. The rating agency affirmed the issuer rating at 'IND AAA'/Stable and maintained ratings across existing debt instruments while assigning ratings to new facilities.

The proposed bank loan facilities include INR33.25 billion designated for concession fee payments for round 5 asset acquisitions. The bonds comprise zero-coupon bonds with face value up to INR20.32 billion and proposed NCDs of INR9.68 billion for refinancing existing rupee term loans.

Portfolio Structure and Asset Base

NHIT operates through a consolidated structure housing 28 toll road assets across multiple subsidiary companies. The InvIT holds assets through three main subsidiaries: NHIT Western Projects Private Limited managing round 1 and 2 assets, NHIT Eastern Projects Private Limited overseeing round 3 assets, and NHIT Southern Projects Private Limited handling round 4 assets.

The diversified portfolio spans 11 states including Andhra Pradesh, Assam, Gujarat, Karnataka, Maharashtra, Madhya Pradesh, Rajasthan, Telangana, Uttar Pradesh, West Bengal, and Chhattisgarh. No single asset contributes more than 9% to overall toll revenues, mitigating concentration risks.

Financial Performance and Revenue Growth

The trust's asset portfolio demonstrates robust revenue performance across different rounds. Round 1 assets recorded toll collections of INR4,740 million in 9MFY26, representing 8% year-on-year growth with average daily collections of INR17.24 million. Round 2 assets showed stronger momentum with 11% growth to INR3,341 million during 9MFY26, while round 3 assets achieved 14% growth to INR10,986 million.

India Ratings projects the InvIT's revenue to grow at a CAGR of 7%-9% over FY27-FY32 in the base case scenario, supporting comfortable debt service coverage ratios above 1.80x throughout the debt tenor.

Debt Protection and Liquidity Framework

The rating reflects strong debt protection mechanisms and adequate liquidity provisions. NHIT maintains a debt service reserve equivalent to one quarter of debt obligations, with cash trap provisions activated when DSCR falls below 1.35x. The consolidated net debt-to-enterprise value ratio stands at 42.22%, well below the SEBI-permitted ceiling of 70%.

The financing structure ensures complete cash flow fungibility across all project assets, with surplus cash from subsidiary SPVs flowing to the InvIT for debt servicing and distributions to unitholders.

Strategic Positioning and Future Outlook

NHIT benefits from strong sponsorship by the National Highways Authority of India and backing from reputable investors including CPP Investment Board and Ontario Teachers' Pension Plan, each holding 19.95% stakes. The trust's strategic importance in India's national monetisation pipeline supports its long-term growth prospects.

The proposed round 5 acquisition will add two toll road assets in Maharashtra and Andhra Pradesh, requiring total concession fees of INR62.21 billion. This expansion aligns with NHIT's strategy of acquiring revenue-generating assets based on yield thresholds, traffic characteristics, and geographic diversity while maintaining strong credit metrics.

National Highways Infra Trust (NHIT) has received a comprehensive credit rating update from CARE Ratings Limited, reaffirming its strong financial position and operational performance across its diversified toll road portfolio. The rating agency has maintained CARE AAA; Stable ratings on existing facilities while assigning new ratings totaling ₹3,375.00 crore.

Rating Actions and Facility Details

CARE Ratings Limited has taken multiple rating actions on NHIT's various facilities and instruments, reflecting the trust's robust credit profile:

The rating agency withdrew ratings on certain non-convertible debentures that were not placed in the market, as requested by the company.

Strong Operational Performance

NHIT's operational metrics demonstrate significant improvement following portfolio expansion. The trust reported toll collections of ₹2,364 crore in FY25 with average daily toll collection (ADTC) of ₹6.30 crore, representing a substantial increase from ₹2.58 crore in FY24. The addition of round-4 assets has further enhanced performance, with ADTC reaching ₹11.37 crore in 9MFY26.

Diversified Asset Portfolio

NHIT currently operates 26 toll road assets across four acquisition rounds, spanning 2,355 km across 12 states including Gujarat, Rajasthan, Maharashtra, Telangana, Andhra Pradesh, Karnataka, Madhya Pradesh, Uttar Pradesh, Assam, West Bengal, Uttarakhand and Chhattisgarh. The portfolio composition includes five assets under round-1, three under round-2, seven under round-3, and eleven under round-4.

The trust's assets demonstrate operational maturity, with 57% of assets (by length) having over 10 years of operational history, 4% with 5-10 years, and 38% operational for less than five years. Two additional road assets under round-5 with an aggregate length of 311 km are proposed to be subsumed under NHIT, which would increase the portfolio to 28 toll road assets.

Financial Strength and Risk Management

NHIT maintains a comfortable financial position with consolidated net debt to enterprise value at 43% as of December 31, 2025. The trust has established robust risk management mechanisms including a debt service reserve account (DSRA) of ₹139 crore in fixed deposits and ₹336 crore in DSRA bank guarantees, equivalent to one-quarter of debt servicing obligations.

The rating agency highlighted the trust's benefits from cashflow pooling under the InvIT structure, favorable capital structure, and strong debt coverage metrics. However, ratings remain subject to inherent risks including traffic growth variations, toll rate revision linkages to wholesale price index movements, and operation and maintenance risks.

Strategic Positioning

As the principal vehicle for monetizing road assets under the National Asset Monetisation Pipeline, NHIT holds strategic importance for the Government of India. The trust operates under concession agreements ranging from 20 to 30 years with the National Highways Authority of India (NHAI), providing long-term revenue visibility through the toll-operate-transfer model.

The rating outlook remains stable, with CARE Ratings expecting NHIT's business and financial risk profiles to remain stable, supported by healthy toll collections, comfortable leverage, and strong debt coverage indicators.

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