POWERGRID Infrastructure Investment Trust (PGInvIT) has received a mixed regulatory response from the Securities and Exchange Board of India (SEBI) regarding its request for relaxations from various compliance requirements. The development was communicated to stock exchanges through a formal letter dated February 17, 2026.

SEBI Grants Partial Relief

SEBI has granted PGInvIT relaxation till March 31, 2026 from the applicability of provisions outlined in SEBI Circular no. SEBI/HO/DDHS-PoD-2/P/CIR/2023/153 dated September 11, 2023. This circular, titled "Board nomination rights to unitholders of Infrastructure Investment Trusts (InvITs)," forms Chapter 22 of the SEBI Master Circular for InvITs dated July 11, 2025.

Corporate Governance Compliance Denied

However, SEBI has not acceded to PGInvIT's request for extension of relaxation from strict compliance with several key regulations. The denied relaxations pertain to corporate governance norms regarding the requisite number of independent directors on the Board of POWERGRID Unchahar Transmission Limited (PUTL), which serves as the investment manager.

The specific regulations from which relaxation was sought but denied include:

• Regulation 4(2)(e)(v) of SEBI (Infrastructure Investment Trusts) Regulations, 2014
• Regulation 26G
• Regulation 26H(1)
• Regulation 26H(2)
• Regulation 26(K)(1)

Government Company Status Impact

PUTL operates as a government company under Section 2(45) of the Companies Act, 2013, by virtue of being a subsidiary of Power Grid Corporation of India Limited. This classification means that the authority to appoint Independent Directors on PUTL's Board rests with the Ministry of Power, Government of India.

Ongoing Coordination

PUTL has indicated that it remains in continuous communication with the Ministry of Power regarding the independent director appointment matter. The investment manager has committed to promptly communicate any developments in this regard to stakeholders and regulatory authorities.

The communication was signed by Shwetank Kumar, Company Secretary & Compliance Officer of POWERGRID Unchahar Transmission Limited, acting as Investment Manager of POWERGRID Infrastructure Investment Trust.

POWERGRID Infrastructure Investment Trust (PGInvIT) announced its financial results for the third quarter of fiscal 2026, declaring a ₹3 per unit distribution and showcasing robust operational performance across its transmission asset portfolio.

Financial Performance and Distribution

For Q3FY26, PGInvIT reported strong financial metrics with total consolidated income reaching ₹3,249 million. The revenue composition included ₹3,167 million from operations and ₹82 million from other income, primarily interest on deposits. Total expenses for the quarter stood at ₹1,177 million, resulting in a net distributable cash flow (NDCF) of ₹2,614 million.

The declared distribution of ₹3 per unit represents the third payout for fiscal 2026 and marks the 18th consecutive quarterly distribution since the trust's listing. This brings cumulative distributions since listing to ₹55.50 per unit, totaling ₹50.51 billion distributed to investors against the IPO issue price of ₹100 per unit.

Operational Excellence

PGInvIT's transmission assets demonstrated exceptional operational performance during Q3FY26. Based on provisional data, the average availability across all special purpose vehicles (SPVs) exceeded 99.75%, reflecting operational excellence while maximizing incentive potential. The trust operates through five SPVs with presence across Himachal Pradesh, Andhra Pradesh, Telangana, Madhya Pradesh, and Maharashtra.

The portfolio comprises approximately 3,700 circuit kilometers of transmission lines and more than 6,600 MVA of transformation capacity, backed by 35-year transmission service agreements with an average remaining tenure of above 27 years.

Capital Structure and Credit Profile

As of December 31, 2025, PGInvIT maintained a conservative capital structure with outstanding external borrowing of ₹10,661 million. This includes a ₹5,756 million loan from HDFC Bank raised in March 2022 and a ₹5,060 million loan from HDFC Bank in December 2024 for funding acquisitions.

The trust maintains the highest credit ratings of AAA with stable outlook from ICRA, CRISIL, and CARE Ratings. Trade receivables stood at ₹911 million with an average collection period of 27 days, reflecting strong payment discipline from counterparts.

Growth Strategy and Future Outlook

PGInvIT announced strategic initiatives to address growth challenges, including formation of a consortium with POWERGRID for participating in tariff-based competitive bidding (TBCB) projects. The Board has granted in-principle approval for the consortium with POWERGRID as lead partner and PGInvIT holding 74% stake, targeting projects with aggregate cost around ₹500 crores.

The trust highlighted significant long-term opportunities, including:

• ₹9.16 lakh crores of planned transmission investments up to 2032 as per the National Electricity Plan
• ₹6.43 lakh crores investment for Brahmaputra Basin power evacuation, with ₹1.91 lakh crores up to 2035
• Potential state-level asset monetization initiatives

Management acknowledged the challenge of limited transmission asset availability for acquisition in the near term while expressing confidence in the long-term transmission sector outlook. The trust continues to evaluate opportunities for value-accretive growth while maintaining its commitment to delivering stable returns to unitholders.

Source: Exclusive earnings call transcript