You’re right about summarizing the whole broker / analyst call, apart from a few questions - it was almost like a call with automated bots! Refusing to explain or give any additional details beyond what is mentioned in the OD.
Now coming to the yield - they’re offering ownership of 85% shares (7650 crores) of INVIT in IPO, which means the post issue market cap will work out in the range of 9100 crore.
The projected avg 3 year NDCF cash flow guidance is 1150 crores (interestingly goes down from 1250 odd crores in year 1, I don’t know why…)
Now here’s the caveat - this projection is based upon 100% ownership of 5 assets by the INVIT.
However, the INVIT will only own 74% of the assets post IPO which means effective NDCF ownership at 74% stake is 851 crores.
That gives a pre-tax yield of 9.35%. 4 out of the 5 assets are under the new tax regime so the dividend is mostly taxable.
Effective post tax yield should be between 7.5-8% if you apply in the IPO. Nowhere near a juicy offering by the merchant bankers which is something you often get with PSU IPOs. Quite disappointed to be honest.
Getting into bed with a PSU management at that yield, not a chance in hell for me!
If it comes to 70-75 will buy from open market.