The drastic fall in imported coal prices over the last year has enabled the debt-laded Essar Power to narrow its losses by nearly 70% in the last fiscal, which has cleared the way for the company to become profitable this fiscal after at least three years of making losses.
The turnaround has been led by the company’s 1,200 MW sub-critical imported coal-based power plant in Salaya, Gujarat. As with the Ruias-promoted firm, the plant had been making losses and contributed Rs 684 crore of loss to the parent company’s loss of nearly Rs 1,000 crore in FY 15.
“The plant made a profit of about Rs 35 crore last fiscal, thus wiping out most of the losses of Essar Power, which is expected to be around Rs 300 crore,” Essar Power’s executive vice chairman Sushil Maroo said. The company is yet to prepare a consolidated financial statement.