Singapore state investor Temasek Holdings [TEM.UL] last Friday agreed to invest US$200 million ($278 million) in the power business of India’s GMR Infrastructure <GMRI.BO> that would help the Indian firm expand its generation capacity.

Temasek, through a fully owned unit, will subscribe to compulsorily convertible securities of GMR Energy (GEL), the two firms said in a statement.

However, they did not disclose how much stake the investor will take.

GMR Energy, which houses the power projects of the GMR group, currently has installed capacity of 808 megawatts, with several other projects at an advanced stage of development.

“GEL plans to enhance its installed generation capacity to more than 6,500 MW over 3 to 4 years, thus necessitating significant capital investment to fund its expansion plans,” GMR said in a statement.

India’s faces a peak hour power shortage of 12%, and power generation firms have lined up for fund raising to expand and bridge the crippling gap in the fast growing economy, Asia’s third-largest.

Since July last year, Adani Power <ADAN.BO>, NHPC <NHPC.BO>, Indiabulls Power <INDP.BO> and JSW Energy <JSWE.BO> have together raised about US$2.4 billion through public offers, capitalising on investor interest in the sector and a booming stock market.

GMR, which builds and manages airports, roads and power plants in India, has benefited from a government focus on infrastructure. Its operations outside India include power plants in Europe, Mexico and Australia, as well as the Istanbul airport.

A top group official told Reuters last November GMR, based in the southern Indian city of Bangalore, was in talks with several investors for possible stake sales in its power and infrastructure businesses.

In a separate statement, GMR Infrastructure said its board has approved raising 5 billion rupees ($153 million) through debentures.

Ahead of the announcements, GMR Infra shares closed up 0.6% at 61.70 rupees, in a Mumbai market that rose 1.2%.