IndiGrid announced the acquisition of solar assets from Spain-based Fotowatio Renewable Ventures (FRV) for close to Rs 700 crore as it looks to foray into the renewable energy space from the power transmission business.

In conversation with CNBC-TV18, CEO Harsh Shah said that today IndiGrid's portfolio is about Rs 14,000 crore in size and the FRV acquisition will add another 5 percent to it.

"The acquisition is small in terms of the overall size, but it is important because it is the first solar project that we have acquired. We would look to do approximately 20-25 percent solar in our portfolio which would result in somewhere around Rs 4,000 crore of solar projects in next couple of years," he said.

Shah added that the company is focused on stable cash flows. "We are focused on stable cash flows which provide long term predictability to our investors. Solar projects with central counterparties like NTPC, I believe, are fitting that requirement very well. This we believe will provide a good distribution yield to our investors in this kind of market," he said.

Shah explained that IndiGrid was also focusing on acquiring solar assets. "Solar provides far more predictability in comparison to other renewable energy assets. Therefore we have restricted our focus on solar projects," he said.

He added that the company has done a few acquisitions in 2020, but are awaiting clearances.

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(Edited by : Jerome Anthony)