Kotak Alternate Asset Managers Limited (Kotak Alts) on Wednesday said it has exited its investment in HKR Roadways Limited, selling the company to Singapore-based Cube Highways and Infrastructure V Pte. Limited.
Kotak Alts had invested in HKR through its Special Situations strategy. Over the investment period, it realised around Rs 1,650 crore through distributions and the final exit, generating more than 2x its investment, the firm said in a statement.
HKR Roadways operates a 206-km, four-lane state highway project in Telangana under a build-operate-transfer toll concession that runs until February 2041. The asset operates three toll plazas and serves as a transportation corridor within Telangana while connecting the state to Chhattisgarh, Maharashtra and North India.
Commissioned in 2014, the project faced delays in acquiring right-of-way, lower-than-expected traffic and significant pending capital expenditure, leading to debt-servicing stress and its classification as a non-performing asset, said Kotak Alts.
Kotak Alts acquired a majority stake in HKR from the Gayatri Group in May 2021 following a one-time settlement with the original lender consortium. It invested Rs 800 crore to acquire and revive the asset, it added.
Since then, the firm completed pending capital expenditure, undertook road maintenance, upgraded tolling infrastructure and introduced operational and governance changes. The project subsequently achieved final completion status, with improvements in traffic and toll collections.
“HKR is a strong example of how patient capital, deep operational expertise and active asset management can unlock value in complex situations. By working closely with stakeholders, we transformed a stressed infrastructure asset into a high-performing platform. The successful exit underscores our ability to identify, acquire and create value in special situations through hands-on execution and disciplined capital allocation,” said Rahul Chhaparwal, Managing Partner at Kotak Alts.
