Adani Power has approached two large State-run lenders, Rural Electrification Corporation (REC) and Power Finance Company (PFC), for its 1,600-MW Godda power project in Jharkhand.
According to industry sources close to the development, REC and PFC are likely to approve ₹5,000 crore each, which would make it the largest debt financing for a greenfield thermal power project.
This could also emerge as the only large advance extended to the private sector player at a time when banks and NBFCs have shied away from lending to infrastructure in general and power sector particularly, as it is one of the highly-stressed sector with over ₹2 trillion of non-performing loans.
The total cost of the Godda project is estimated at nearly $1.97 billion (which is nearly ₹14,000 crore).
According to Brickwork Ratings May 2018 report, the project will be financed with the mix of debt and equity of 80:20. “At the preliminary stage, promoters have infused nominal equity of ₹5 lakh, as well as unsecured loans for land acquisition related needs. As per the IA terms, financial closure is required to be achieved by November 2018, which is one year from the date of signing of Implementation Agreement,” the report noted then.
Adani Group’s spokesperson declined to comment, while queries sent to REC and PFC management went unanswered till press time.
Power to Bangladesh
Adani Group has inked a deal with the government of Bangladesh to supply power to the country from its projected Godda plant in 2017. Following this, Adani Power (Jharkhand) Ltd, the SPV for the project, has signed a power purchase agreement (PPA) with Bangladesh Power Development Board (BPDB) and an Implementation Agreement (IA) with the Power Grid of Bangladesh.
According to these agreements, the first unit of 2x800 MW project is proposed for commercial operation in January 2022 which is 50 months from November, 5, 2017 — the date of PPA and IA. The second unit should be commissioned with a gap of four months.
The company has received all the clearances to start the work, Adani Power’s CFO Rajat Kumar Singh said during an Investor Call in May last year.
He added that the project will be providing dedicated power supply to Bangladesh via the transmission line that is being laid is completely isolated from the Indian Grid. The power plant will fire imported coal supplied by Adani Group’s mines in Indonesia as well as upcoming Carmichael mine in Australia.