The Union Cabinet has approved a proposal to increase the equity investment threshold of public sector enterprise PowerGrid Corporation to Rs 7,500 crore from Rs 5,000 crore per subsidiary to enable it to bid for capital-intensive transmission projects.
The decision was taken by the Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, at its first meeting at the Prime Minister’s new office, Seva Teerth.
“The approval enhances the permissible equity investment limit of Powergrid from the current threshold of Rs 5,000 crore per subsidiary to Rs 7,500 crore per subsidiary, while retaining the existing cap of 15 per cent of the company’s net worth,”, Cabinet Committee on Economic Affairs said in a statement.
Significance of approval
The increase in the investment threshold will enable Powergrid, the largest and most experienced transmission service provider in the country, to expand its investment in its core business and support the evacuation of renewable energy capacity, helping achieve the target of 500 GW from non-fossil-based sources.
The Cabinet Committee on Economic Affairs said that Central Public Sector Enterprises (CPSEs) can now participate in bids for capital-intensive transmission projects, such as Ultra High Voltage Alternating Current (UHVAC) and High Voltage Direct Current (HVDC) transmission networks.
Additionally, it will broaden competition in Tariff-Based Competitive Bidding (TBCB) for selecting bidders for critical transmission projects, thereby ensuring better price discovery and ultimately leading to the availability of affordable, clean energy for consumers, said an official release.
Powergrid share price
Powergrid share price closed at Rs 304.50 on Tuesday, 0.38 per cent higher. The company’s stock has gained 1.64 per cent in the last 5 trading sessions.
In the last one month, Powergrid’s share price has jumped by 19.7 per cent. In the last six-month and one year period, Powergrid’s share price has grown by 7.6 per cent and 17.5 per cent, respectively.
In Q3 FY26, Powergrid has reported an 8 per cent year-on-year rise in consolidated net profit to Rs 4,185 crore, driven by higher income.