Cube Highways Trust has raised ₹1,150 crore through a private placement of AAA-rated non-convertible debentures with a 7.50% annual coupon. The funds, provided by Axis Bank and ICICI Bank, are aimed at refinancing debt and supporting project maintenance.
Cube Highways Trust has successfully completed a private placement of non-convertible debentures (NCDs), raising ₹1,150 crore to support its capital management strategy. The issuance attracted participation from major institutional lenders, with funds secured to address existing financial obligations and meet project requirements across the trust’s network of special purpose vehicles (SPVs).
The debt instruments, which carry a AAA rating, were issued with a five-year maturity period. Investors in this tranche will receive an annual coupon rate of 7.50%, with interest payments scheduled on a quarterly basis. The bidding process for these instruments took place on September 28, 2026, through the electronic platform of the National Stock Exchange (NSE).
Institutional demand for the paper was met by Axis Bank Limited and ICICI Bank Limited, which served as the primary subscribers. Axis Bank was allocated ₹550 crore, while ICICI Bank provided ₹600 crore. Management intends to deploy these proceeds primarily to refinance existing senior debt and settle commercial paper obligations. Additionally, the capital is designated to fund operational and maintenance expenses and capital investments across the various road assets managed by the trust.
For investors, it is important to note that Axis Bank acts as a related party in this transaction, as it is the promoter of the trust’s trustee, Axis Trustee Services Limited. While such arrangements are standard in financial structures, they remain a point for ongoing governance monitoring.
Infrastructure investment trusts (InvITs) like Cube Highways are inherently debt-heavy vehicles. While the AAA credit rating indicates a high level of creditworthiness, the trust’s reliance on debt makes it sensitive to market conditions and refinancing requirements. The current transaction is part of a broader approved financing program allowing the trust to raise up to ₹4,500 crore. Investors may monitor how the trust manages its leverage and maintenance costs, as rising operational expenses in specific road assets could impact future cash flows and coverage ratios. Future tranches of this financing program may utilize a mix of bank facilities, commercial paper, or further NCD issuances depending on prevailing market interest rates.