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Kohinoor Mandal
Nilanjan Dey

Jaiprakash Hydro is identifying avenues for entering the "transmission and distribution business and setting up new projects."

Kolkata , Aug. 27

ICICI Bank is converting its Rs 150 crore of debentures issued by Jaiprakash Hydro Power Ltd (JHPL) into rupee term loans. It will also be issuing a fresh working capital loan of Rs 50 crore. The company, which has paid a maiden dividend of 7.5 per cent in 2004-05, is contemplating entering the power transmission and distribution system. It is also planning to set up new power plants.

The company has sought the shareholders' permission for converting the debentures issued to ICICI Bank to rupee term loans. It is learnt that these were privately placed secured non-convertible debentures.

There were two series of these debentures. The first one aggregated Rs 115 crore while the second amounted to Rs 35 crore. ICICI informed Jaiprakash Hydro about this conversion in June this year.

In the Directors' report, Mr Jaiprakash Gaur, Chairman, said the company has managed to restructure its debt and reduce the rate of interest to 10.5 per cent. The repayment schedule has been extended to 44 instalments, beginning July 2005.

This has helped Jaiprakash Hydro to "reduce the gap between the tariff as per the PPA (power purchase agreement) and the market rate of power."

According to him, efforts are on for further reduction of the interest rates.

For the year ended March 31, 2005, the company registered a turnover of Rs 301.35 crore against Rs 296.61 crore in the previous fiscal. Profit after income-tax, however, dropped marginally to Rs 51.10 crore from Rs 57.91 crore.

With reference to the new ventures, Mr Gaur said that the company is identifying avenues for entering the "transmission and distribution business and setting up new projects."

Apart from being environment-friendly, hydropower is believed to be ideally suited for meeting the peak load requirement; it is also said to be the most cost-effective option. "Thus, the future of the company's operations is bright."

Meanwhile, it has said that the 300-MW Baspa-II hydroelectric project of JHPL is performing well. In March this year, Jaiprakash Associates Ltd, the holding company (earlier known as Jayprakash Industries), offloaded 36.66 per cent of its stake in JHPL.

Jaiprakash Associates sold 18 crore shares of Rs 10 face value of Jaiprakash Hydro through the book building route. A price of Rs 32 was finally fixed for JHPL shares.

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