Infrastructure construction major Patel Engineering is planning to venture into electricity generation by setting up power plants in Arunachal Pradesh and Tamil Nadu over the next three years.

A top company official said that for the purpose, the company has set up a wholly owned subsidiary, Patel Energy, which will run the business.

Mr Rupen Patel MD of Patel Engineering said that “We plan to set up a hydro and thermal power plant in Arunachal Pradesh and Tamil Nadu respectively.”

Patel Energy plans to set up a 120 MW hydro power project in Arunachal Pradesh at an investment of INR 800 crore. The debt equity ratio for the project would be 70:30 with the company bringing in INR 210 crore while the balance would be tied-up through debt.

Mr Patel said that “We hope to achieve financial closure by Q1 FY 11.” He added that the company has already obtained land and environmental clearances and only one more approval needs to be received, he said. The project is expected to get operational in 2014.

(Sourced from Business Line)