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 Rs 17,000 crore.
The Rs 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, Chief Financial Officer Arun Kedia told Business Standard.
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, he said.
The company requires around Rs 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.
“We have coal mines under development and it a natural business diversification for us to develop coal-based power projects,” said Kedia.
Adhunik Power and Natural Resources is currently in advanced talks with three domestic private equity companies to raise Rs 300-400 crore by offloading a 30-40 per cent stake. This is to fund the Rs 263-crore equity portion of the first phase of the Jamshedpur project.
The company has raised close to Rs 1,700 crore of the Rs 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.
The first phase of the Jamshedpur project will take off by December 2011. The company has acquired close to 400 acres and has received various clearances from the government. Bharat Heavy Electricals Ltd will supply the boiler, turbines and generators (BTG) for the project, said the executive.
Coal blocks have been allocated in Orissa and Jharkhand to fuel the first phase of the project. Adhunik Power and Natural Resources will soon scout for more coal mines in India and abroad, Kedia said.
