Jindal Power to up Chhattisgarh plant capacity

Jindal Power, a wholly owned subsidiary of Jindal Steel & Power (JSPL), is likely to invest more than Rs 5,000 crore in adding another 1,320 mw to its thermal power project in Chhattisgarh.

The company is in the process of inviting bids from suppliers. Top sources in the company said once the bids were evaluated, a timeline for the project would be set.

Jindal Power is already in the process of setting up the coal-based 1,000 mw OP Jindal Super Thermal Power Plant near Tamnar in Chhattisgarh's Raigarh district.

At present, 250 mw is operational and the project will be completed by June 2008. The company will be adding 1,320 mw over and above the 1,000 mw capacity. The investment for 1,000 mw is around Rs 4,500 crore.

Though the investment in the project was yet to crystallise, sources pointed out that Rs 4 crore was needed to generate 1 mw.

Jindal Power is also examining various options for funding the investment. An initial public offer (IPO) could be one of the options.

However, company sources maintained that the board was yet to decide whether the IPO would be the preferred route for funding.

According to the scope of work outlined to the bidders, the capacity could be even larger than currently being contemplated.

The current station being considered will comprise two identical sets. However, the company has indicated that there is a likelihood of increasing the two sets by two more at a suitable place, where the company is set to receive a captive coal block for setting up the additional capacity.

If the Jindal Power IPO materialised, it would be the second steel group to consider a public issue for its energy company.