Diversified business conglomerate Hinduja Group has revised its business plan for India to expand its presence in the growing power sector.
Under the new structure, Hinduja Energy India (HEIL), an entity set up by the group for making foray into the power sector, will be converted into an investing company.
The group plans to bring in R400 crore foreign direct investment from its entities registered in Mauritius into HEIL This entity will then make downstream investment in the power sector indirectly by investing in existing or setting up special purpose vehicles engaged in generation, transmission, distribution and power trading.
HEIL was set up to make direct investments in the power business in India. But the group reworked the business strategy to kick start its power operations here by looking for investments both in existing power projects and setting greenfield projects.
So far the company has been unable to make a foray into the power sector and its proposed 1,040 mw coal-based plant in Visakhapatnam has been delayed for last several years due to legal and bureaucratic wrangle.
As per company?s submission to the finance ministry, HEIL now plans to give a boost to its power ambition by bringing in R400 crore foreign direct investment from Hinduja Group Energy (HEL) and IXTF, the investment holding entity for subsidiary companies in Indian power sector. Another dose of FDI worth R200 crore would be brought from other group entities.
At present, Hinduja Group has formed only one SPV ? Hinduja Power Corporation (HNPCL) ? which is supposed to run the Vizag-based merchant power plant. Once the revised business plan is implemented, this SPV will come under HEIL, which will become the beneficiary of the downstream investment to be made by the company.
The group is eyeing a larger share in the Indian power market and hopes to to set up 10,000 mw generation capacity over next few years. Apart from Vizag, the group is also exploring opportunity to invest in the states of Gujarat, Maharashtra and Uttar Pradesh.
Hinduja Group is multi billion dollar investment and banking group with diversified global portfolio of holdings across manufacturing, services and banking sectors. The group has activities across three core areas such as investment, banking, international trading and global investments.
As part of its global investments their group owns businesses in automotive, information and technology, media, entertainment and communications, banking and finance, infrastructure project development, chemicals and agri business, energy, healthcare and real estate.