Sajjan Jindal-led JSW Energy plans to raise up to Rs 12,500 crore via debt and equity during the financial year 2017-18 for acquisition of power assets. The company’s board has passed an enabling resolution to raise around Rs 5,000 crore through secured and unsecured non convertible debentures on a private placement basis, and another up to Rs 7,500 crore via equity through qualified institutional placements and other equity options.
Sajjan Jindal, chairman of JSW Group told reporters post the company’s Annual General Meeting on Thursday that the company is in a consolidation mode and would look at acquiring suitable assets in due course. “We have passed an enabling resolution to raise debt and equity which would help us in the consolidation process as and when we decide to buy any asset. It would help us to save time and effort then,” Jindal said.
In response to a question if the company would have to dilute substantial equity at the current base, Jindal said, “We may not need to raise the entire Rs 7,500 crore in equity during the year, hence the dilution may not be much.”
Jindal said, there are lots of stressed assets in the thermal and hydro side that were bid very aggressively in the past leading to creation of stressed assets. “Going ahead my biggest worry is same mistake should not get repeated in the solar bids. Lenders and bidders should be cautious in bidding and lending to projects that are overtly priced.
“The company is evaluating some of the stressed assets in the solar and wind segment along with thermal and hydro projects and if anyone suits our requirement we would buy them. We believe since the situation is dynamic and these assets are over priced in current scenario, both the lenders and the bidders will have to take a haircut to revive these projects” Jindal said.
However, he declined to specify the name of projects been evaluated.
He also said that other discoms are likely to follow the example of Uttar Pradesh government by cancelling the power purchase agreements to buy cheaper power from the merchant market in the interest of the consumers. However, he said, “JSW Energy is well placed on priority as one of the lowest cost producer in the country to be meet the shift in demand”.
As of March-end 2017, JSW Energy debt to equity was around 1.29 times, while the consolidated debt was around Rs 13,384 crore for the period.