India Grid Trust completes acquisition of two solar assets for Rs 660 crore

The 100 MW assets are fully operational and located in a high radiation zone in the 400 MW Ananthapuramu Solar Park in Andhra Pradesh with a contractual period of 25 years at a fixed tariff.

India Grid Trust, which is India’s first power infrastructure investment trust (InvIT) has informed the bourses that it has completed the acquisition of a 100 per cent stake in two solar assets with the cumulative capacity of 100 MW (AC) from Fotowatio Renewable Ventures (FRV) at an enterprise value of approximately Rs 660 crore. This marks the first renewable energy acquisition by any InvIT in India. 

With this acquisition, the company’s asset portfolio will now comprise of 14 diversified power projects consisting of 40 transmission lines (approx. 7,570 ckms), 11 substations (approx. 13,550 MVA capacity) and 100 MW of solar power plants across 18 states & one union territory. 

The 100 MW assets are fully operational and located in a high radiation zone in the 400 MW Ananthapuramu Solar Park in Andhra Pradesh with a contractual period of 25 years at a fixed tariff. These superior quality projects use Tier I equipment and are eligible to receive a fixed tariff on per unit basis of electricity generated; thus, limiting the operational risk. The projects that are operational for over 2 years now have a robust track record of generation & collections since inception. 

This transaction is in line with IndiGrid’s strategy to acquire solar projects with long-term power purchase agreements, operational track record, and financially strong counterparties such as SECI & NTPC. 

The acquisition will be funded through a combination of debt, internal accruals, and recent Rights issues. The net debt/AUM stands around 58 per cent post this acquisition, providing adequate headroom for growth against the 70 per cent leverage threshold as per SEBI InvIT Regulations. 

On Wednesday, the stock of India Grid Trust is trading 0.9 per cent higher at Rs 135.90 from its previous close of Rs 134.73 on BSE.