A Special Purpose Vehicle (SPV) in an InvIT is the project-level subsidiary company that directly owns, maintains, and operates a specific infrastructure concession or asset.
A dedicated corporate entity incorporated for the specific purpose of developing, building, or operating an infrastructure asset under a concession agreement or statutory license, held by the InvIT directly or via HoldCo.
Every single highway, power substation, or solar plant in India is legally housed in its own private company to isolate risk. These are SPVs. When an InvIT is created, the trust buys the shares of these SPVs from the sponsor.
'Jaipur Expressway Private Limited' is an SPV. It holds the 30-year concession agreement with NHAI, operates the toll plazas, and collects toll fees into its dedicated escrow account.
The SPV collects ₹80 Cr in tolls, pays ₹15 Cr in O&M costs and ₹5 Cr in taxes. Under SEBI regulations, at least 90% of its remaining ₹60 Cr cash flow (₹54 Cr) must be upstreamed to the InvIT or HoldCo.
Each SPV must be ring-fenced. Any historic corporate guarantees given by the sponsor for an SPV must be formally replaced or extinguished prior to closing.
Audit each SPV's legal records, concession extensions, and lender liens to ensure clean ownership transfer to the trust.