 "Power sector's first InvIT IndiGrid acquires 3 more projects at Rs 1,490 cr")
IndiGrid, country’s first listed infrastructure investment trust (InvIT) for power transmission assets, is launching its first rights issue to raise Rs 1,200 crore. The company recently also raised Rs 2,500 crore via non-convertible debentures.
Harsh Shah, CEO of IndiGrid, told Business Standard the InvIT would be able to acquire Rs 8,000 crore worth of assets after the rights issue. “Our asset size is growing so we need more capital for future acquisitions,” said Shah.
IndiGrid is in the process to acquire NER-II power transmission project for Rs 4625 crore from Sterlite Power, which is also one of its sponsors. Shah said after the rights issue, IndiGrid can acquire one more asset of similar value.
“The NER deal is partially debt funded and part from the rights issue. We would be in a position to acquire another asset of Rs 4,000-4,500 crore after the rights issue,” said Shah.
The board of IndiGrid Investment managers on Tuesday approved units and rights issue size of up to 116,695,404 units for an amount aggregating to Rs 1,283.65 crore. The rights issue is priced at Rs 110 per unit.
“We are seeing a lot of growth in the sector. Since last year, we have added Rs 10,000 crore worth of assets in the portfolio. Secondly, we want to make a healthy balance sheet which allows us to capitalise any growth opportunity that comes in. The objective of the rights issue is to have growth capital and a healthy balance sheet,” Shah said.
“It’s an incentive to our existing investors as they get to invest at a 20 per cent cheaper price.” After the rights issue, Shah said the debt to AUM ratio would be 60 per cent. “As it can go up to 70 per cent, it gives a headroom for us to acquire one more asset,” he said.
IndiGrid which earlier acquired assets mostly from its sponsor Sterlite Grid, one of the largest private power transmission company, is now branching to other transmission assets as well. Over the last year, IndiGrid has acquired assets of a Spanish company FRV, Techno Electric, Kalptaru and Reliance Infrastructure.
“We have done more beyond Sterlite Power. Our focus would be to remain neutral. We would acquire good quality assets with long term cash flow,” Shah said.
IndiGrid has 12 operating assets across 15 states. Sterlite has already divested nine assets worth $1.5 billion to IndiGrid. It has assets under management worth of approximately Rs 14,200 crore as on December 31, 2020. IndiGrid Investment Managers Limited is the investment manager of the InvIT and is majority owned by Electron IM Pte. Ltd., an affiliate of the KKR Sponsor.
