NTPC eyes majority stake in ADAG’s Delhi power utilities

Twesh Mishra | | Updated on: May 27, 2020

Power giant, the first PSU in the race for stake in two BSES firms

NTPC Ltd wants to buy out the 51 per cent stake of Reliance Infrastructure Ltd from Delhi’s power distribution companies.

In a letter to the Delhi Electricity Regulatory Commission (DERC), NTPC expressed its interest to enter the power distribution sector and acquire the distribution assets. NTPC is the first public sector undertaking to join the race to buy ADAG’s stake in BSES. Enel Group, Torrent Power and Greenko Group are also said to have evinced interest in buying this stake.

“NTPC is keen to explore the opportunities for acquiring 51 per cent stake in BSES Rajdhani Power Ltd (BRPL) and BSES Yamuna Power Ltd (BYPL), which are on sale, provided the equity sale is done through a transparent process,” stated the NTPC letter to DERC seen by BusinessLine .



BSES has two power distribution companies (Discoms): BRPL serving South and West Delhi and BYPL catering to Central and East Delhi. These companies were acquired in 2002 when Delhi’s discoms were privatised. BSES is currently a 51:49 joint venture between Reliance Infrastructure and the Delhi government. As of March 2020, BSES served 44 lakh customers in the national capital. The two other discoms in Delhi are Tata Power Delhi Distribution Ltd and New Delhi Municipal Council.

As of March, BSES reported a total revenue of ₹15,250 crore with earnings before interest, taxes, depreciation, and amortisation (EBITDA) at ₹2,050 crore. The total debt of BSES is estimated at around ₹1,900 crore.

Reliance Infrastructure is a part of the Reliance-Anil Dhirubhai Ambani Group (ADAG).

Reduce debt burden

ADAG has been trying to cut debt by selling stake in group entities. In August 2018, Reliance Infrastructure sold its energy business in Mumbai, including generation, distribution and transmission, to Adani Transmission for ₹18,000 crore.

In June last year, NTPC and PowerGrid Corporation of India Ltd had formed National Electricity Distribution Company Ltd, a 50:50 joint venture aimed at entering the electricity distribution business on a pan-India basis.

Published on May 27, 2020
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