1. At a Glance
Shrem InvIT offers India’s most tantalizing dividend yield—17.6%—wrapped inside a trust structure housing toll roads and cash flows. But don’t be fooled by the juicy payouts; there’s a mountain of debt lurking beneath those distributions. Yield hunters, enter cautiously.
2. Introduction with Hook
What if your savings account paid 18% per year? You’d jump in, right? That’s exactly what Shrem InvIT seems to offer. But this isn’t a bank—it’s an infrastructure investment trust juggling toll roads, leverage, and investor expectations like a Bollywood villain flipping coins.
- Dividend Yield: 17.6%
- 3Y Sales CAGR: 63%
- Debt: ₹8,413 Cr (that’s not a typo)
This InvIT promises returns sweeter than your FD—question is, can it pay the toll when the music stops?
3. Business Model (WTF Do They Even Do?)
Structure:
- An Infrastructure Investment Trust (InvIT) holding Special Purpose Vehicles (SPVs) that own and operate toll roads.
- Assets are monetized via long-term toll collections.
- Backed by Shrem Group, an investor in hospitality, infra, and now yield products.
Key Assets:
- 33 highway projects across 9 states
- Operational length: 8,400+ lane-km
- Average concession life: 15+ years remaining
Revenue Model:
- Cash flow from toll collections
- Pass-through income to unitholders (after interest, O&M, capex)
- New SPV additions drive growth in AUM and distribution per unit (DPU)
4. Financials Overview
FY25 Key Metrics:
| Metric | Value |
|---|---|
| Revenue | ₹2,458 Cr |
| Net Profit | ₹1,118 Cr |
| EBITDA Margin | 63% |
| ROCE | 11.4% |
| ROE | 17.7% |
| Debt | ₹8,413 Cr |
| EPS (Diluted) | ₹18.16 |
Growth Snapshot:
- Revenue 4x in 3 years
- Net Profit CAGR: 56% over 3 years
- FY25 PAT = ₹1,118 Cr (up from ₹487 Cr in FY23)
5. Valuation
CMP: ₹110
P/E: 6.06
P/B: ~1.03
Book Value: ₹107
Dividend Yield: 17.6%
EduVal™ Estimate:
| Method | Range ₹ |
|---|---|
| DCF (Toll Model) | ₹115 – ₹130 |
| Yield-based (DPU ~₹18, Target 12–14%) | ₹130 – ₹150 |
| NAV (conservatively) | ₹120 – ₹140 |
Fair Value Band: ₹120 – ₹140
Looks undervalued on every metric—if distributions continue and debt doesn’t choke growth.
6. What’s Cooking – News, Triggers, Drama
- Q4FY25 DPU: ₹3.20/unit declared
- Cash profits improving: ₹289 Cr PAT in Mar ’25 quarter
- ROE steady near 18% despite high leverage
- SBI + Union Bank loans approved in FY24
- Tax math weirdness: Negative tax rates for 3 years straight? Creative accounting or InvIT magic?
- Concerns: Debtor days at 167; cash conversion cycle bloated
7. Balance Sheet
| Item | FY25 (₹ Cr) |
|---|---|
| Equity Share Capital | 5,012 |
| Reserves | 1,509 |
| Borrowings | 8,413 |
| Other Liabilities | 1,017 |
| Fixed Assets | 2,467 |
| Investments | 1,264 |
| Other Assets | 12,220 |
| Total Assets | 15,951 |
Verdict:
Fixed assets and receivables heavy. High leverage, but structured as long-term infra loans. Reserves improving.
8. Cash Flow – Sab Number Game Hai
| Cash Flow Item | FY25 (₹ Cr) |
|---|---|
| CFO (Operating) | ₹386 |
| CFI (Investing) | ₹-169 |
| CFF (Financing) | ₹-209 |
| Net Cash Flow | ₹7 |
Commentary:
- Cash flow turned positive after 3 years of big investments
- Most debt-funded expansion done
- Now entering yield-harvesting phase (hopefully)
9. Ratios – Sexy or Stressy?
| Ratio | FY25 | FY24 | FY23 |
|---|---|---|---|
| ROCE | 11.4% | 12% | 8% |
| ROE | 17.7% | 18% | 15% |
| OPM | 63% | 75% | 54% |
| D/E | 1.55 | 1.46 | 1.20 |
| Debtor Days | 167 | 176 | 174 |
Verdict:
Good ROE despite leverage. But debtor days and debt-to-equity need watching.
10. P&L Breakdown – Show Me the Money
| Year | Revenue ₹ Cr | EBITDA ₹ Cr | PAT ₹ Cr | EPS ₹ | DPU ₹ |
|---|---|---|---|---|---|
| FY22 | 571 | 440 | 299 | 7.48 | — |
| FY23 | 1,384 | 741 | 487 | 10.15 | — |
| FY24 | 1,953 | 1,461 | 1,051 | 18.17 | ₹15.0 |
| FY25 | 2,458 | 1,554 | 1,118 | 18.16 | ₹17.6 |
Takeaway:
Income growing fast. DPU consistently increasing. Margins stable.
11. Peer Comparison
| Company | P/E | Yield % | ROE % | D/E | PAT ₹ Cr | OPM % |
|---|---|---|---|---|---|---|
| IRB InvIT (est.) | ~14 | 7–8% | ~10% | 1.2–1.4 | ~800 | 60% |
| Shrem InvIT | 6.0 | 17.6% | 17.7% | 1.55 | 1,118 | 63% |
| NBCC | 50.2 | 0.45% | 25.9% | Nil | 610 | 5.2% |
Conclusion:
Shrem InvIT wins on dividend yield and profitability—loses on debt risk and liquidity.
12. Miscellaneous – Shareholding, Promoters
Promoter Holding:
- Has declined 11.6% over 3 years
- Units diluted to fund expansion (SBI, Union Bank, Shrem Group)
No. of Unitholders:
- Not publicly disclosed regularly (SEBI exemption for InvITs)
- Major banks & institutions have exposure
Fun Fact:
Shrem started with hospitality (Radisson Blu Goa) and now owns roads from Rajasthan to Nagaland. Weird flex, but okay.
13. EduInvesting Verdict™
Shrem InvIT is like that auntie who throws the best weddings and never misses an EMI—lavish, dependable, and slightly over-leveraged.
The 17%+ dividend yield is rare, the cash flows look real, and the toll assets are mature. But that ₹8,000+ Cr debt mountain makes it a high-yield, moderate-risk play—not a sleep-easy SIP.
EduNote™:
At current valuations, this is a toll-based cash cow. But monitor payouts, debt serviceability, and promoter behavior closely. When infra works—it really works.
Metadata
– Written by EduInvesting Analyst Team | 18 July 2025
– Tags: Shrem InvIT, Toll Roads, Infrastructure Trust, High Dividend, InvIT India, Passive Income, Infra Stocks
