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IndiGrid InvIT, an infrastructure investment trust, is looking to acquire operational transmission assets to the tune of ₹2,000-3,000 crore over the next few quarters. The entity, which saw its AUM (assets under management) grow by over 30 per cent at around ₹21,000 crore in FY22, backed by acquisition of assets, is expecting to maintain the growth momentum.
According to Meghana Pandit, Chief Investment Officer, IndiGrid, its revenue has been growing at a CAGR of around 45-50 per cent over the last five years. IndiGrid became operational in 2017 and has been able to grow its AUM from ₹5,000 crore to ₹21,000 crore in the last five years.
“We will go large on transmission assets as huge amount of investments are likely to happen in the sector moving forward. We are in the process of conducting due diligence for some of the assets. Nearly 80 per cent of our AUM comes from operational revenue generating projects,” Pandit told BusinessLine.
The infrastructure investment trust acquired assets to the tune of ₹6,000-7,000 crore last fiscal.
The Indian infrastructure sector in general and power sector in particular is witnessing an amped up transformation driven by visionary policy initiatives from the Central government to deal with the needs of a $5 trillion economy in the upcoming future. To this end, the government has laid down its National Infrastructure Pipeline vision of more than ₹100 lakh crore worth infrastructure projects with substantial participation from the private sector. Transmission sector alone is expected to witness investments worth ₹3.3-3.5 lakh crore in during FY2020-25.
Increased investment in transmission
Highlighting the potential of the sector, Pandit said, there is estimated to be a strong growth in power demand due to rising temperatures and economic recovery post Covid lockdowns. Geopolitical tensions and changing energy landscape are also likely to increase reliance on electricity to ensure energy security for nations and a shift away from oil and gas.
Transmission growth is the missing link between renewable energy focused at select clusters and demand for electricity at the end consumer across India. Implementation of GNA (General Network Access) rules - right to transmission access and flexibility to all generators and drawing entities throughout the nation would be a huge positive for the sector.
Transmission tenders to the tune of ₹40,000 crore have already been notified and monetisation of close to ₹45,000 crore has been identified under National Monetisation Pipeline till FY25, creating healthy pipeline for bidding and acquisition respectively, she said.
IndiGrid would look at acquisition of framework asset (KTL), other operational solar and transmission assets. It would also evaluate bidding opportunities in power transmission with partners and explore opportunities in adjacent spaces such as utility scale battery storage.
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