Capital Infra — Q3 FY26 earnings call

Call held 6 Feb 2026

Management summary

Capital Infra Trust reported a strong Q3 FY26 marked by strategic asset acquisitions and disciplined debt management, with NAV per unit rising to Rs. 72.31 and DPU at Rs. 2.34. The company expanded its AUM to Rs. 6,733 crores through three HAM acquisitions worth Rs. 2,350 crores and is actively refinancing debt to reduce interest costs. However, consolidated profitability saw a decline due to a modification loss, and DPU guidance was revised to 11-12% reflecting current market conditions.

Highlights

  • DPU for Q3 FY26 stood at Rs. 2.34 per unit, reflecting normalized annualized yields of 11% to 12%.

  • Successfully completed 3 high quality HAM acquisitions for Rs. 2,350 crores, increasing AUM by 57% to Rs. 6,733 crores.

  • NAV per unit increased to Rs. 72.31, a 7.2% rise over Q2 FY26, driven by accretive acquisitions and deleveraging.

  • Debt rationalized by Rs. 420 crores and effective interest rate projected to reduce to 7.35% from 7.82% by March end, saving 47 basis points.

  • Strong acquisition pipeline with 7 ROFO assets expected by FY27 and another 7 by H1 FY29, targeting AUM of Rs. 9,000-10,000 crores.

Concerns

  • Consolidated EBITDA declined to Rs. 48 crores and net profit to Rs. 11 crores in Q3 FY26, primarily due to a modification loss.

  • DPU guidance for FY26 revised downwards to 11-12% cash yields from previous 13.5-14% due to RBI rate cuts impacting revenue potential.

Key financials

2 periods

Headline

  • NAV per unit
    ₹72.31
    QoQ +7.2%
  • AUM
    ₹6,733 Cr
    QoQ +57%
  • Standalone Total Income
    ₹129 Cr
    QoQ +26.5%
  • Consolidated EBITDA
    ₹48 Cr
  • Consolidated Net Profit
    ₹11 Cr

Q3 FY26

  • DPU
    ₹2.34

What they filed

Q1 FY27: revenue up 37.0%, net profit up 270.3% against the same quarter last year.

₹ Cr · quarterly
Line itemQ4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue159 189 179 178 283 +78%259 +37%
EBITDA-3 -81 127 44 220 +7433%145 +279%
Net profit-37 -74 78 11 195 +627%126 +270%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Order book

high confidence

Total value

₹6,733 Cr

as of 2025-12-31 quantified

57% QoQ

Inflow this quarter

₹2,350 Cr

Pipeline

other

7 ROFO assets by FY27, 7 by H1 FY29, diligence on 2 in Q4 FY26, and third-party HAM assets.

Our acquisition-led growth strategy remains in place, and we have successfully acquired 3 assets within 12 months of our listing.

Source: Prepared remarks

Capital allocation

high confidence
  • Debt Debt disclosed Cost 7.3% · Maturity: 11.2 years (average tenure)
    • Repayment Debt rationalized by Rs. 420 crores through unit capital raise and internal accruals. ₹420 Cr
    • New borrowing Fresh borrowing of Rs. 1,100 crores at 6.85% PAPM (3-month T-bill linked) to finance ROFO asset acquisition, completed in January. ₹1,100 Cr
    • Refinance Plan to refinance Rs. 933 crores of debentures through a mix of debentures and rupee term loan at 6.85% PAPM. ₹933 Cr
    With an average tenure of 11.2 years, the Trust is well-positioned with long-term funding stability and adequate headroom for future acquisitions.
  • Dividend ₹2.34/share (interim)
    The Board has approved a total distribution of Rs. 2.34 per unit for Q3 FY26, comprising a quarterly DPU of Rs. 1.45 per unit and interim DPU of Rs. 0.89 per unit.
  • M&A Jodhpur Ring Road, Hasanpur-Bakhtiyarpur, Champa-Korba Acquisition · Closed · Consideration ₹[object Object] (cash)

    Expanded AUM by 57% and strengthened residual concession life.

    Acquired at 9.3% discount to adjusted enterprise value; immediately cash flow accretive.

    We completed 3 high quality HAM acquisitions for Rs. 2,350 crores and expanded our AUM to Rs. 6,733 crores with NAV rising to 72.31 per unit. ... The acquisition of 3 ROFO assets, namely Jodhpur Ring Road in Rajasthan, Hasanpur-Bakhtiyarpur in Bihar, and Champa-Korba in Chhattisgarh, which were approved in October 2025 were acquired at 9.3% discount to the adjusted enterprise value assessed by independent valuer as of August 2025.
  • Liquidity Liquidity disclosed Rs. 345 crores preferential issue and Rs. 1,250 crores QIP raised. Preferential issue used for debt repayment. QIP for acquisitions, fully utilized as of today.
    These outcomes were supported by Rs. 345 crores preferential issue and the Rs. 1,250 crores QIP... The prepayment of Rs. 420 crores of borrowings, collectively strengthening our financial position and supporting long-term growth. ... The preferential issue capital was used for repayment of existing debt of the Trust... The QIP amount of Rs. 1,250 crores was raised in December. And again, that was only for acquisitions of the 3 ROFO assets. Part of that amount, about Rs. 660 crores was unutilized as of 31st December. However, as of today, that has been fully utilized, all the funds raised in last quarter.

Guidance & targets

Dividend

  • Annualized DPU Yield Dividend · FY26 · High confidence 11%-12%

    Previously 13.5%-14% → 11%-12%

    Firstly, our yields have now fully normalized with distributions reflecting steady-state annuity cash flow. The DPU for Q3 stood at Rs. 2.34 per unit comprising 0.89 per unit of interim distribution and Rs. 1.45 per unit for the quarter. Cumulative distributions since listing now total Rs. 33.09 per unit. As we had guided earlier, the higher payouts in FY25 were supported by IPO-related cash reserves, while the FY26 run rate now reflects stable, normalized, annualized yields of 11% to 12%, fully backed by the recurring annuity-driven cash flows.

    — Hare Krishna

AUM

  • AUM Target AUM · medium-term · High confidence Rs. 9,000 crores to Rs. 10,000 crores
    Together these opportunities position us well to scale up to 17 assets by next financial year and move towards our medium-term AUM target of around Rs. 9,000 crores to Rs. 10,000 crores.

    — Hare Krishna

  • AUM Addition AUM · next financial year · High confidence 4 to 7 assets
    So, overall, for the next 12 months, we intend to add in our AUM up to Rs. 9,000 crores to Rs. 10,000 crores, which currently stands at around Rs. 6,733 crores. So, we plan to add at least 4 to 7 assets in the next financial year.

    — Hare Krishna

Acquisitions

  • ROFO Assets Ready for Acquisition Acquisitions · FY27 · High confidence 7 assets
    7 ROFO assets are expected to be ready for acquisition by FY27 with another 7 likely to be available by H1 FY29 and diligence on two of these will begin in Q4 FY26.

    — Hare Krishna

  • IRR on Third-Party Acquisitions Acquisitions · High confidence 11.5%-12%
    pretty much we anticipate to get 11.5% to 12% IRR on the third-party acquisitions which we are pursuing.

    — Hare Krishna

Debt

  • Net Debt-to-EV Ratio Debt · medium term · High confidence 45%-47%
    Our objective is to maintain leverage in the 45% to 47% range in the medium term, while realizing interest savings of around 47 basis points, thereby strengthening the free cash flow and enhancing the predictability of future distributions.

    — Hare Krishna

  • Effective Interest Rate Debt · by March end · High confidence 7.35%

    Previously 7.82% → 7.35%

    by March end, our effective interest rate per annum would reduce to 7.35% from 7.82% in September '25 with an overall savings of 47 basis points, reflecting our disciplined deleveraging.

    — Hare Krishna

What to watch in Q4 FY26

FY27 DPU Guidance

March '26 quarter
Current 11-12% for FY26
Target New guidance for FY27

Why it matters

New DPU guidance will set expectations for unitholder returns for the next financial year.

In future, we will give fresh guidance in the March'26 quarter.

Risks & concerns

  • Modification loss impacting consolidated profitability

    medium

    Consolidated EBITDA declined to Rs. 48 crores and net profit to Rs. 11 crores due to a modification loss recorded in Q3 FY26.

    Management acknowledged

  • RBI rate cuts impacting revenue potential and DPU guidance

    medium

    RBI rate cuts impacted revenue potential, leading to a revision of annualized DPU yield guidance from 13.5-14% to 11-12%.

    Management acknowledged

  • Quality and O&M costs for third-party HAM acquisitions

    medium

    Need to be cautious about the quality of construction, compliance with concession terms, and potential O&M costs for third-party assets.

    Management acknowledged

  • Uncertainty in NAV forecasting post-acquisition

    low

    Forecasting NAV post-acquisition is difficult as it depends on negotiation with sellers and equity raise price.

    Management acknowledged

Q&A highlights

8 direct
Acquisition pipeline and AUM growth targets Direct
So, overall, for the next 12 months, we intend to add in our AUM up to Rs. 9,000 crores to Rs. 10,000 crores, which currently stands at around Rs. 6,733 crores. So, we plan to add at least 4 to 7 assets in the next financial year.

Provides specific targets for future asset acquisitions and AUM growth, indicating the company's expansion strategy.

Asked by Nisha Shah

IRR thresholds for future acquisitions Direct
pretty much we anticipate to get 11.5% to 12% IRR on the third-party acquisitions which we are pursuing.

Clarifies the expected return on new third-party asset acquisitions, which is crucial for investor valuation.

Asked by Nisha Shah

Need for additional equity for acquisitions Direct
Yes, we are required to raise additional capital. As of now, in the medium term, we are targeting our leverage ratio of 45% to 47%. Post June'26 when we would have made 6 distributions, we can enhance our leverage up to 70 and at that point in time, we will relook our leverage ratio and then look at how much additional equity and debt we require for new acquisitions.

Indicates future capital raising plans and potential changes in leverage strategy, impacting dilution and risk profile.

Asked by Nisha Shah

Revised DPU guidance and cash yield basis Direct
So, with regards to the guidance given earlier in the beginning of the year, since we have witnessed rate cut by RBI which impacts our revenue potential, and thereafter we had capital raise and addition of assets as well. So, we are looking to modifying the guidance which was given earlier. And therefore, right now, as we speak, we are looking at 11% to 12% cash yields for this financial year. And this 11% to 12% guidance for this financial year is based on IPO price of Rs. 99 per unit.

Explains the revision in DPU guidance and its underlying reasons (RBI rate cuts, capital raise), setting new expectations for unitholder returns.

Asked by Satish Poddar

Drivers of NAV improvement Direct
See, the way we have given on Slide #11 of the investor presentation, our current NAV stands at 72.3, of which the acquired assets NAV as of 31st December would be approximately around 85.1 per unit, whereas the portfolio NAV would be around 65.4 per unit. We have raised capital through preferential issue of Rs. 345 crores, which was used to repay the debt itself. So that has nominally increased the NAV, and that combined effect shows to around 65.4 per unit as of December for the existing portfolio of the Trust.

Provides a breakdown of how recent acquisitions and deleveraging contributed to the increase in NAV per unit.

Asked by Rohan Shah

Sustainability of DPU run rate with asset base expansion Direct
With regards to the run rate, that is what we have mentioned in the investor presentation as well, I mentioned earlier that we are looking at a cash yield of 11%-12% going forward. And the way we look at is that based on the current portfolio and the cash generation capability of the assets, we are quite confident of maintaining this going forward.

Reassures investors about the sustainability of the DPU run rate despite asset base expansion, linking it to current portfolio performance.

Asked by Priyam Shah

Unutilized funds from QIP and Preferential Issue Direct
The fundraise undertaken by us in last quarter, these were for specific purposes. The preferential issue capital was used for repayment of existing debt of the Trust, which was completed in December '25 itself. The QIP amount of Rs. 1,250 crores was raised in December. And again, that was only for acquisitions of the 3 ROFO assets. Part of that amount, about Rs. 660 crores was unutilized as of 31st December. However, as of today, that has been fully utilized, all the funds raised in last quarter.

Clarifies the utilization of recently raised capital, confirming that all funds are now deployed for their intended purposes.

Asked by Priyam Shah

Status of GST-related claims with NHAI Direct
There are still some residual amounts, which was indemnified by the CERA but has not been approved by NHAI. For that we would be raising indemnity to the sponsors. This amounts to around Rs. 60.6 crores and is due over the next 12 months from today, for which we are seeking final opinion from a legal counsel and tax advisor so that the final amount would be raised as claim from these sponsors because they have not been approved by NHAI as of today.

Provides an update on pending claims, indicating a potential future cash inflow and the company's strategy to recover it.

Asked by Tarun Sisodia

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Detailed narrative

Q3 FY26 Performance and Portfolio Expansion

Capital Infra Trust delivered a strong Q3 FY26, with DPU at Rs. 2.34 per unit and NAV per unit increasing by 7.2% to Rs. 72.31. The Trust successfully acquired three high-quality HAM assets for Rs. 2,350 crores, expanding its Assets Under Management (AUM) by 57% from Rs. 4,282 crores in September '25 to Rs. 6,733 crores. These acquisitions, including Jodhpur Ring Road, Hasanpur-Bakhtiyarpur, and Champa-Korba, were secured at a 9.3% discount to their adjusted enterprise value and are immediately cash flow accretive, bringing the total operational HAM assets to 12 across 8 states.

Financial Highlights and Distribution

On a standalone basis, total income for Q3 FY26 rose to Rs. 129 crores, up from Rs. 102 crores in the previous quarter, driven by higher dividend inflows and increased interest income. Standalone EBITDA stood at Rs. 128 crores, with net profit at Rs. 85 crores. However, consolidated total income remained stable at Rs. 182 crores, while consolidated EBITDA declined to Rs. 48 crores and net profit to Rs. 11 crores, primarily due to a modification loss recorded in the quarter. The Board approved a total distribution of Rs. 2.34 per unit, contributing to cumulative distributions of Rs. 33.09 per unit since listing, totaling Rs. 976 crores returned to unitholders.

Disciplined Debt Management and Refinancing Initiatives

The Trust actively managed its debt, rationalizing Rs. 420 crores through unit capital raise and internal accruals. New borrowings of Rs. 1,100 crores were undertaken in January at a floating interest rate of 6.85% PAPM to finance ROFO asset acquisitions. A plan is in place to refinance Rs. 933 crores of debentures by March end at 6.85% PAPM, aiming to reduce the effective interest rate from 7.82% in September '25 to 7.35%, resulting in 47 basis points of savings. The net debt-to-EV ratio improved to 43.34%, with a medium-term target of 45-47%, and the average debt tenure stands at 11.2 years.

Strategic Acquisition Pipeline and Future Growth

Capital Infra Trust maintains a robust acquisition-led growth strategy, with a pipeline of 14 ROFO HAM assets from its sponsor; 7 are expected by FY27 and another 7 by H1 FY29, with due diligence on two commencing in Q4 FY26. The company is also evaluating third-party HAM assets, targeting an IRR of 11.5-12% for such acquisitions. The goal is to scale to 17 assets by next financial year, aiming for a medium-term AUM of Rs. 9,000-10,000 crores by adding 4-7 assets in the upcoming financial year.

Revised DPU Guidance and Market Conditions

The annualized DPU yield guidance for FY26 has been revised to 11-12% (based on the IPO price of Rs. 99) from the earlier 13.5-14%. This adjustment is primarily attributed to RBI rate cuts, which impacted revenue potential, and the recent capital raise. Management confirmed that this 11-12% cash yield is sustainable and fully backed by recurring annuity-driven cash flows. Fresh guidance for FY27 DPU will be provided in the March '26 quarter.

GST CIL Indemnity Claim and Operational Stability

The Trust has a pending GST CIL indemnity claim of Rs. 60.6 crores from NHAI, which is fully contractually protected and expected to be realized between Q4 FY26 and Q2 FY28. This amount is not yet reflected in the reported NAV but represents a potential upside. Operationally, the portfolio remains stable and resilient, with NHAI's independent engineer inspections confirming good road conditions and smooth ride quality across all 12 assets, and 100% of due annuities received.

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