TEC is planning to put up a 500 MW multi-fuel plant near Mumbai to meet the demand growth in Mumbai. The project is still awaiting clearance from the Maharshtra State Electricity Board (MSEB). The companies plan to set up a fuel jetty, which will reduce their fuel transportation costs and increase fuel supply reliability. The companies are also diversifying into captive power generation for various corporates. Additionally, they have a power purchase agreement (PPA) with Karnataka State Electricity Board (KSEB) for setting up an independent power project in the state.

Icra's rating takes into account the operational and financial strengths of the companies. Icra expects the companies to continue getting their reasonable return in their license area as in thepast. Additionally, the diversification into captive power plants (CPP's) and independent power production (IPPs) has reduced the business risk of the companies while preserving their low financial risk.

The Tata Electric Companies consists of Tata Hydro Electric Power Supply Company, Andhra Valley Power Supply and Tata Power Company. The companies have the license to generate and distribute bulk power to the city of Mumbai till the year 2014. The companies are the largest private producers of power in the country.

The total installed capacity of the companies is 1,841.5 MW with a thermal capacity of 1,417.5 MW and 444 MW of hydro-electric power. The total generation of power was to the tune of 9,174 million units in 1997-98. The companies generated a turnover of Rs 2,615 crore and a profit after tax of Rs 320 crore in 1997-98.

Icra has also retained the MAA ratings assigned to the fixed deposit programme of Can Fin Homes Ltd (CHFL), indicating high safety. CHFL's disbursements grew by 34 per centduring 1997-98 to Rs 137.2 crore. There was an increase in focus on lending to the individual segment which represented 86 per cent of the total portfolio.

During 1997-98, there was a decline in the disbursements to builders due to the conscious decision of the management to reduce exposure in the construction segment in view of sluggish business conditions. Though there was a dip in collections from a few builders, it was maintained at a favourable level from the corporate and the individual segments.

The company's capital adequacy continues to be comfortable. Icra expects CHFL to show a steady improvement in disbursements while the asset quality and profitability are expected to be maintained at current levels.