 "JSW keeps cash chest ready for acquisition")
The company, which recently posted 49% increase in its fourth quarter net profit at Rs 335.6 crore, also has a war chest ready to start acquiring assets.
“We have a cash chest of around Rs 900 crore on March 31, 2013, for acquiring assets. We are looking at power plants with a size of over 1,000 megawatts,” Sanjay Sagar, chief executive officer, JSW Energy, told Business Standard. The company also announced a 20% dividend for its shareholders since its performance improved with global coal prices on a downtrend.
More From This Section
The Sajjan Jindal-promoted company is already assessing projects which fits its criteria like fuel availability, and sale prospects of power. JSW, however, is looking to acquire only thermal power projects. “They can be at any stage of construction and commissioning,” assures Sagar.
JSW Energy also plans to use the equity it had planned to invest in its own power plants, which have been put on the backburner. It has frozen the development of four power projects with a combined capacity of over 7,000 megawatts—in West Bengal, Chhattisgarh, Jharkhand and expansion of its currently operating Jaigarh power plant at Ratnagiri.
The company, which currently has a generation capacity of 3,140 megawatts, plans to expand it to 11,770 megawatts. It has already received clearances for Chhattisgarh and West Bengal projects. Land has been acquired for three of the projects, including the expansion of Ratnagiri project. However, worries over coal supply and questions on thermal-based generation with regards to the policy, made them put these plans on the backburner.
“Without clarity on the coal issues, it would be very unreasonable to go and sink shareholder money on a new thermal power project,” said Sagar.
The company is claiming clarity on standard bidding documents, long-term power purchase agreements as well.
The government is re-working standard bidding documents to include clauses that would take unforseen developments during the life of a power project. Many states and their discoms are delaying bids for power procurement as they are waiting for rules on standard bid documents to come out.
While Sagar claimed they have done their initial work on the project as a developer, they need support in the form of increased supply by Coal India. “Or, we would like to see clarity on coal block auctions. We do not see either of these happening,” he said.