India Grid Trust is close to launching its Rs 3,000 crore qualified institutional placement (QIP). The fund raising will help the Infrastructure Investment Trust (InvIT) acquire new assets in the power transmission space.
Chief Executive Officer Harsh Shah said: “We continuously scan the market for acquiring operating transmission assets to increase the yield for our investorss.”
According to people in the know, the process could get completed by June. The transmission space is likely to benefit from Power Grid’s capex cycle, expected to remain healthy in FY20.
Analysts say transmission and distribution players can expect to gain from Power Grid’s capex plans in the north-east and intra-state capex in Karnataka, TN and Uttar Pradesh, and that an increase in railway electrification and oil and gas pipeline capex will also bring in healthy order flow going ahead.
The India Grid Trust has been seeking opportunities in transmission space and is likely to shore up its operating transmission assets in the next financial year.
In August, India Grid Trust acquired Patran Transmission from Techno Electric & Engineering. The transaction marked India Grid Trust’s first third-party acquisition.
The acquisition was done through internal accruals and a debt issuance of Rs 250 crore. In 2017, it had acquired three power transmission assets from Sterlite Power for Rs 1,490 crore.
India Grid Trust is among the only two listed InvITs in India.
InvITs are trusts that manage income-generating infrastructure assets, offering investors regular yields. At present India Grid Trust owns six power transmission projects.
Fundraising through QIPs has been tepid recently after it hit an all-time high in 2017. In 2018, as 24 corporates raised Rs 16,076 crore.