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IndiGrid to raise Rs 7,500 crore debt in 18 months to finance acquisitions

​IndiGrid is on track to achieve asset under management of Rs 18,000 crore over the next two years as it acquires projects for which it has signed framework agreement with Sterlite Power. It will acquire four of these assets in the next 6-18 months.

, ET Bureau|
Last Updated: Jan 23, 2020, 04.13 PM IST
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MUMBAI: Infrastructure investment trust IndiGrid plans to raise Rs 7,500 crore debt over the next 18 months to finance the acquisition of assets from its sponsor Sterlite Power Grid Ventures, Harsh Shah, Chief Executive Officer told ET.

IndiGrid is on track to achieve asset under management of Rs 18,000 crore over the next two years as it acquires projects for which it has signed framework agreement with Sterlite Power. It will acquire four of these assets in the next 6-18 months, he said.

“For all the projects that we have already identified for acquisition, we are fully capitalised on the equity side since our preference issue in May. We will acquire these assets via debt and internal accruals, we would raise around Rs 7,500 crore of debt financing as we acquire these assets,” Shah said.

The company currently has total debt of Rs 5,200 crore, at an average interest rate of 8.75%.

In May 2019, IndiGrid raised Rs 2,560 crore through a preferential issue of units to qualified institutional investors, of which Rs 1,084 crore was invested by KKR while the balance Rs 980 crore by GIC Infra Holdings Pte. Following this, IndiGrid is managed by Sterlite Investment Managers which is majority owned by KKR.

IndiGrid currently owns eight operating projects consisting of 18 transmission lines with more than 4,900 circuit kms length and four substations with 7,735 MVA transformation capacity. It has assets under management worth INR 11,056 crore currently.

The company said that the with the Reserve Bank of India allowing the banks to lend to InvITs, it has more options to raise debt. It will also consider raising debt through dollar bonds or domestic bonds.

“For any other assets that we acquire beyond the ones that are identified, we would raise equity,” Sha said.

SEBI recently enabled rights issue for InvITs and IndiGrid management is upbeat that this will be a great impetus to all stakeholders.

“We are also very encouraged by the rights issue guidelines as it will enable an efficient way to raise future capital to fund acquisitions and offer opportunity to participate for all investors,” Shah said.

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