Tata Power to be selective about bidding for stressed assets: CEO

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Published: February 14, 2019 4:43:14 AM

Tata Power has invested Rs 14,986 crore on this plant and suffered financial losses to the tune of Rs 9,821 crore from under-recoveries of fuel prices from this unit till December 31, 2018.

Tata Power has invested Rs 14,986 crore on this plant and suffered financial losses to the tune of Rs 9,821 crore from under-recoveries of fuel prices from this unit till December 31, 2018.

Tata Power would be “very choosy” while bidding for the takeover of stressed power plants under the insolvency and bankruptcy code, a senior company official said on Wednesday. “We will focus only on plants with good equipment, long term power purchase agreements, fuel supply agreements and sustainable tariffs,” Praveer Sinha, chief executive officer, Tata Power, told FE.

According to sources, power plants already put up for sale by lenders include KSK Energy’s 3,600-MW Akaltara plant, GMR Chattisgarh’s 1,370-MW plant in Raikheda, Coastal Energen’s 1,200 MW Mutiara station, Meenakshi Energy’s 1,000-MW Nellore Andhra plant and Avantha Group’s 600-MW Jhabua unit.

In November, Tata Power had announced the acquisition of more than 75% stake of the stressed 1,980-MW Bara power plant. The acquisition was valued at more than Rs 9,000 crore (including tax liabilities).

“We are in the process of getting all the clearances for the Prayagraj acquisition and we expect this to get completed in another one month,” Sinha said, while speaking at the sidelines of the inauguration ceremony of the country’s first grid-scale battery-based energy storage system.

The 10-MW grid-connected system is owned by AES and Mitsubishi Corporation, and is located at Tata Power Delhi Distribution’s sub-station here.

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Lenders are looking to find resolution to their stressed power assets before the Supreme Court starts hearing the huge batch of petitions against the RBI’s February 12 circular. About 40,000 MW of thermal capacity are currently under stress.

When asked about the development at the company’s beleaguered imported-coal based power plant in Gujarat, Sinha said that the company is discussing the matter with the states which buy power from the plants. Coastal Gujarat Power, the Tata Power arm that runs the 4,150-MW Mundra ultra mega power plant, has sought more time from the Central Electricity Regulatory Commission (CERC) to get consent from Gujarat, Maharashtra, Haryana, Rajasthan and Punjab for tariff revision.

The Supreme Court on October 29 had allowed the CERC to amend the PPAs of the unit as per the recommendations of a high-power committee.

Tata Power has invested Rs 14,986 crore on this plant and suffered financial losses to the tune of Rs 9,821 crore from under-recoveries of fuel prices from this unit till December 31, 2018.

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