BHEL in talks to buy 10% in 2 state power projects

Power equipment manufacturer Bharat Heavy Electricals is in talks with Tamil Nadu and Maharashtra governments to set up power plants in a joint venture with state-owned utilities there, a senior BHEL official said today.

"We are in talks to set up one project of two units of 800MW each in Tamil Nadu and two projects of 800 MW each in Maharashtra," the official said.

BHEL proposes to buy around 10 per cent stake in the projects while the rest will be held by state utilities.

"In any power project today, the debt-equity ratio is 70:30. We intend to take around 30 per cent of the 30 per cent equity portion, which comes to a share of around 10 per cent in the project," the official said.

"BHEL has taken equity stakes in power projects earlier also, but as opposed to actually monetarily subscribing to the equity portion in power projects, we used to supply equipment," another BHEL official said.

Supplying equipment in lieu of money ensured revenues and sustained market share for BHEL besides assuring completion of the project."This time, we intend to take equity stake by paying money," the official said.

The shares of BHEL were at Rs 1,532.05 on the National Stock Exchange, down 0.85 per cent from Wednesday.