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Leveraging the strong balance sheet, NTPC Ltd is gearing up for acquisition of assets in the power sector.
It has embarked on the process of due diligence to buy out some of the distressed assets. The power generation major has received at least seven proposals expressing their intent to buy them out.
Arup Roy Choudhury, Chairman and Managing Director, said, “These assets, all of them thermal power projects, have approached us asking us to buy them out. These are good projects with fuel linkages, but the promoters are exiting them for various reasons.”
Refraining to name them at this stage, he said the company will use its strong financials to complete these acquisitions typically made through 70 per cent debt and 30 per cent equity. “We have access to funds at interest rate of as low as 8 per cent. This will make it attractive to buy them out,” he explained.
“While there are many people in the country who are worried about the power sector and its prospects, NTPC continues to be steadfast on its path of growth and will achieve various targets set out by it. The strong numbers during the third quarter reflect the company strengths,” he said.
Addressing a press conference here after a tour of its 2600 MW Ramagundam plant, where he inaugurated a 10 MW solar photo-voltaic power unit, he said NTPC is giving a special thrust to the renewable energy segment. “As the largest generation company with an installed capacity of over 42,500 MW, we have initiated several projects in the renewable energy sector, including wind, solar PV, solar thermal, hydel, and some innovative solar projects on water and geothermal.”
Gas plants Referring to inadequate fuel supply for its gas plants, he said they were considering bidding for NELP. He said even though these gas plants are not functioning due to inadequate gas supply, they were entitled to fixed costs.
With regard to coal related issues, he said the company is all set to become a coal miner with potential resources of 5 billion tonnes.
“We hope to mine about 100 million tonnes per annum within 6-7 years. This will make us a big coal company,” he said.
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