Karnataka Power Corporation Limited (KPCL), the state-owned power generator, is looking at multiple options to raise up to Rs 5,000 crore to part-fund its ongoing power projects. The company plans to divest up to 26 per cent of its equity to raise the money, a top official said.
“We are in the process of adding 8,200 Mw in the next four to five years for an investment of Rs 40,000 crore, 20 per cent of which will be in the form of equity. To meet this equity requirement we need around Rs 5,000 crore which will be mobilised by divesting our stake of up to 26 per cent,” SM Jamdar, managing director, KPCL, said. KPCL has an installed capacity of 5,730 Mw.
For the year-ended March 31, 2010, KPCL achieved a provisional net profit of Rs 410 crore. The government has allocated Rs 500 crore in the state budget for 2010-11 towards the equity requirement of KPCL, same as last year. At present, KPCL has an authorised share capital of Rs 2,000 crore while the paid up share capital is Rs 1,243 crore. Besides, the corporation has reserves and surplus of Rs 2,630.6 crore as on March 31, 2009.
KPCL has appointed SBI Capital Markets as adviser for this purpose. SBI Capital is studying the market conditions. The company is exploring various options to raise the funds, which include private placement or institutional placement or strategic partners, he told reporters, here.
“We already have two strategic partners — L&T and BHEL — who are also joint venture partners in two of our upcoming projects. We are open to more such partners,” Jamdar said.
To add further 8,200 Mw capacity, the tendering and work for projects with 4,500 Mw capacities has begun. Recently, the company issued work order for 800x2 units of thermal power project at Yeramarus and 800 Mw thermal projects at Yedlapur in Raichur district which will be done jointly with BHEL. It has floated tenders for a 700 Mw third unit of Bellary Thermal Power Station at Bellary and a 1,400-Mw gas-based power project at Bidadi. The work is likely to commence in July this year. KPCL is negotiating with the GAIL for the supply of gas for the Bidadi project.