In­dia Power to Buy 3 Stressed Plants for Up to Rs. 800 crore


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In­dia Power Corp is in ad­vanced talks to ac­quire three stressed power plants with a com­bined ca­pac­ity of about 1,000 MW. The Kolkata based com­pany is also look­ing at ex­pand­ing its elec­tric­ity dis­tri­bu­tion area, for which it is hold­ing dis­cus­sions with the gov­ern­ments of Ra­jasthan, Jhark­hand and Ut­tarak­hand.

With­out nam­ing the en­ti­ties, In­dia Power chair­man He­mant Kano­ria said, “Th­ese power gen­er­a­tion as­sets are in the east and their to­tal gen­er­a­tion ca­pac­ity is around 1,000 MW. We are in ne­go­ti­a­tions with the man­age­ment and the bankers of th­ese projects.”

Kano­ria said In­dia Power has an in­ter­nal team of ex­perts which has been ad­vis­ing the com­pany on the ac­qui­si­tions. The com­pany will ap­point a merchant banker to con­clude the deal once the talks reach the fi­nal stage, he said.

IPCL will spend an es­ti­mated Rs 500-800 crore to buy the plants, which have been built on a 70:30 debt-eq­uity ra­tio. It in­tends to fund the ac­qui­si­tions through a mix of debt and in­ter­nal re­serves.

For­merly known as DPSC Ltd, In­dia Power in­tends to be an in­te­grated power util­ity with dis­tri­bu­tion li­cences at Asan­sol and Dur­ga­pur re­gions. To back it up, it has set up three units of 150 mw ther­mal power gen­er­a­tion ca­pac­i­ties. Dur­ga­pur and Asan­sol are ex­pected to con­sume about 250 mw power. The com­pany hopes to sell the rest of the power in the spot mar­ket.

“We plan to grow our dis­tri­bu­tion busi­ness on the one hand and would be ac­quir­ing plants that can feed dis­tri­bu­tion net­works. In­dia Power will build up ca­pac­i­ties based on de­mand from its own dis­tri­bu­tion ar­eas,” said Kano­ria.

Raghav Raj Kano­ria, di­rec­tor at In­dia Power, said: “Ra­jasthan plans to auc­tion out dis­tri­bu­tion fran­chisees for Kota, Bikaner and Bharat­pur. For Kota and Bharat­pur, Ra­jasthan has de­cided on the direct fran­chisee model while for Bikaner it will be the pub­licpri­vate part­ner­ship model.”

Jhark­hand plans to hand over dis­tri­bu­tion of Dhan­bad, Ranchi and Jamshed­pur to pri­vate com­pa­nies.

At present, In­dia Power op­er­ates 100.2 MW of wind as­sets in Ra­jasthan, Gu­jarat and Kar­nataka and has also de­vel­oped a 2 MW grid con­nected so­lar power plant along with West Ben­gal Green En­ergy De­vel­op­ment Cor­po­ra­tion in Asan­sol. The com­pany also owns and op­er­ates a dis­tri­bu­tion li­cence in the re­gion spread over 618 sq km in the coal-rich Asan­sol Rani­ganj re­gion.

It has been serv­ing the area for nine decades, pro­vid­ing power to the un­der­ground col­lieries of East­ern Coal­fields, hos­pi­tals, etc.

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