EESL planning an IPO at ₹5,000 crore valuation
Timing of IPO to be decided next year, says top company executive
State-run Energy Efficiency Services Ltd (EESL) plans to tap into the capital markets to bankroll its energy efficiency programmes, including leasing electric vehicles to companies and installing smart meters to measure power consumption, a top company executive said.
The company, a joint venture set up by four state-run companies in the power sector, has been valued at around ₹5,000 crore by financial services company Investec.
“I have a capital expenditure requirement of around ₹25,000 crore over the next 3-4 years,” Saurabh Kumar, managing director of EESL said in an interview.
“While it is one thing that I keep on going back to NTPC and PFC, but they have their own capex plans. We will look at it (listing) next year and then we will decide when to do it.”
NTPC Ltd, Rural Electrification Corp. Ltd, Power Finance Corp. Ltd (PFC) and Power Grid Corp. of India Ltd own EESL.
EESL is leading India’s ambitious energy efficiency programme that seeks to reduce carbon emissions as part of the country’s climate change goals. India, the biggest emitter of greenhouse gases after the US and China, has agreed to reduce its carbon footprint by a third from its 2005 levels by 2030, as part of its commitments to the United Nations Framework Convention on Climate Change adopted by 195 countries in Paris in 2015.
Mint reported on Wednesday about EESL’s plans to curb its EV sourcing to less than a third of the 10,000 sedans it originally tendered due to lack of demand. The company also runs programmes involving street lighting, domestic lighting, five-star rated ceiling fans, solar study lamps, and agricultural pumps.
EESL acquired combined heat and power provider Edina for ₹493 crore in March 2018 to enter the UK’s £6.4 billion energy efficiency services market. Attracted by battery storage that holds the key for providing on-demand electricity from wind and solar projects, EESL also made a £1.5 million investment in the first utility scale energy storage facility by Leclanché and Deltro Energy to balance the Ontario power grid.
As of 31 March, EESL had gross debt of ₹3,418.6 crore, up 43% from the previous year. It reported a 140% increase in its profit to ₹95 crore on the back of robust revenue growth. Revenue from operations rose 36% to ₹1,837.6 crore.
According to Kumar, EESL is expected to post a profit of around ₹200 crore on revenue of ₹4,000 crore this year.
EESL, which is a joint venture of public sector units (PSUs) under power ministry.
India’s energy efficiency market is estimated at ₹1.5 lakh crore, with a vast potential to grow.
ESL has already set up around 65 charging stations for electric vehicles in New Delhi and will supply vehicles to Meru, Ola and others on lease.
EESL IS LEADING INDIA’S AMBITIOUS ENERGY EFFICIENCY PROGRAMME THAT SEEKS TO REDUCE CARBON EMISSIONS