SRINAGAR: In a significant move that consolidates its presence in India’s highway infrastructure sector, Cube Highways Trust has completed the acquisition of two strategic annuity road projects in Jammu and Kashmir from the National Investment and Infrastructure Fund (NIIF) at a total enterprise value of Rs 4,185 crores. The deal involves the transfer of Quazigund Expressway Pvt. Ltd. and Athaang Jammu Udhampur Highway Pvt. Ltd., which together span approximately 80 kilometres in the Himalayan region.
This acquisition marks a critical addition to Cube InvIT’s portfolio, which now grows to 27 assets across over 8,819 lane kilometres nationwide. The two newly acquired assets, Quazigund Expressway and Jammu-Udhampur Highway, are operational and revenue-generating, and hold residual concession lives of more than six years. Both are annuity-based projects supported by semi-annual fixed payments from the National Highways Authority of India (NHAI), shielding Cube InvIT from any direct traffic risk.
As the new operator, Cube Highways Trust will take over the operations, maintenance, and management of both highway stretches under India’s public-private partnership (PPP) model. The Trust’s responsibilities include ensuring the roads remain in optimal condition, undertaking routine and major maintenance, deploying monitoring and safety systems, and adhering to contractual performance benchmarks set by the NHAI. The operational standards are governed by performance-linked annuity agreements, which guarantee revenue to the Trust irrespective of toll collection or traffic volumes.
The Qazigund Expressway is particularly noteworthy for housing one of India’s longest bi-directional tunnels, serving as a vital gateway between the Kashmir Valley and the rest of India. Meanwhile, the Jammu-Udhampur stretch is a crucial segment in the Jammu–Srinagar corridor, reducing travel time and improving connectivity in the region’s challenging terrain.
According to Cube InvIT’s CEO Vinay C. Sekar, this deal reflects the Trust’s “disciplined capital allocation strategy” and focus on acquiring de-risked assets with predictable cash flows. “These annuity roads will contribute approximately Rs 2.3 per unit annually to net distributable cash flows over the next five years,” Sekar said.
The acquisition increases Cube InvIT’s exposure to annuity-based income streams, which will now constitute 33 per cent of the Trust’s total revenue. Group CFO Pankaj Vasani noted that the deal further strengthens Cube InvIT’s balance sheet, with the post-acquisition Net Debt to AUM ratio at approximately 49 per cent and its AAA-rated credit profile reaffirmed by CRISIL, ICRA, and India Ratings.
Cube InvIT’s assets under management (AUM) are set to increase from Rs 32,266 crores to Rs 36,451 crores post-acquisition. The Trust, backed by global investors including I Squared Capital, ADIA, British Columbia Investment Management Corporation, and Mubadala Investment Company, declared a robust 11.45 per cent annualised yield during FY25 and has distributed Rs 2,770 crores cumulatively since listing.
Vinod Giri, Managing Partner of NIIF’s Master Fund, said the transaction showcases NIIF’s ability to acquire, stabilise, and monetise large infrastructure assets. “These assets reflect Athaang’s operational excellence in managing high-quality road assets. We are proud to have created value and attracted global capital while enhancing the assets’ credit profile,” Giri said, referring to Athaang, NIIF’s wholly owned road platform.
The deal aligns with NIIF’s strategy of investing in critical infrastructure sectors and exiting once assets have been de-risked and optimised for long-term institutional holding. NIIF continues to operate across four strategic verticals—Sustainable Infrastructure, Private Equity, Climate Investments, and Credit—deploying global capital towards India’s developmental goals.
Cube Highways Trust’s move comes at a time when infrastructure investment trusts are gaining traction as vehicles for long-term capital deployment in India’s growing infrastructure landscape. The Trust’s increased focus on annuity assets underscores a shift toward revenue stability amid wider economic cycles and evolving traffic patterns.
With the addition of the Jammu and Kashmir projects, Cube InvIT strengthens its footprint in India’s northern frontier, assuming operational control over strategic stretches that not only enhance its portfolio performance but also contribute to regional mobility and economic connectivity. -(KL)
