Steel and mining company Adhunik Metaliks is planning to foray into the power sector by setting up 3,480 MW generation capacity before 2015 with an investment of close to INR 17,000 crore.
Mr Arun Kedia CFO of Adhunik Metaliks told Business Standard that the INR 3,000 crore Adhunik Metaliks Group’s energy plans will be powered through Adhunik Power and Natural Resources, which will act as the holding company for three coal-based power projects planned in Jharkhand, Orissa and Bihar.
He said that the company, which is now implementing a 540 MW project near Jamshedpur in Jharkhand will double the capacity to 1,080 Mw in the second phase. It is also planning to set up super critical power plants in Chhattisgarh and Bihar of 1,200 MW capacity each.
The company requires around INR 5,000 crore in equity for its power plans. This will be funded by an initial public offering in 2011, strategic tie-ups with power sector players and a stake sale to private equity players, he said.
The Union government is planning to add a minimum 60,000 Mw of capacity during the current five year plan and another 100,000 Mw during the next five-year plan to meet the increasing demand for power. Private sector players, such as Reliance Power, TATA Power, GMR Energy, JSW Energy, Lanco Infratech, Essar and Indiabulls have a pipeline of various power projects, ranging between 3,000 Mw to 32,000 Mw of total capacity.
Mr Kedia said that “We have coal mines under development and it a natural business diversification for us to develop coal based power projects.”
Adhunik Power and Natural Resources is currently in advanced talks with three domestic private equity companies to raise INR 300 crore to INR 400 crore by offloading a 30% to 40% stake. This is to fund the INR 263 crore equity portion of the first phase of the Jamshedpur project.
The company has raised close to INR 1,700 crore of the INR 1,997 crore debt portion, from a consortium of banks led by State Bank of India. The company is planning financial closure for the first phase by next month.
(Sourced from Business Standard)
