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As part of its plans to exit non-finance businesses, Shriram Group is in talks with potential investors to sell its wind power company Orient Green Power for an enterprise value of ₹3,000 crore.
According to sources, the company is in initial stages of conversation and the deal could also include an unutilised land parcel of 2,000 acres.
When contacted by BusinessLine, Orient Green Power’s Compliance Officer, M Kirithika, said, “We have no comments on your source information.”
Rising losses
Orient Green Power is a listed company and its share price has almost doubled over the last one month from ₹12.83 a piece on December 20 to ₹24.70 at close on Monday on the BSE. The company has a diversified portfolio of renewable energy-based power projects but has been struggling the last few years. Its net loss stood at ₹3.34 crore in the quarter ended September 2021 up from ₹1.94 crore during the corresponding previous quarter. Sales rose 5.96 per cent to ₹7.82 crore in the quarter ended September 2021 (₹7.38 crore).
Discom dues
Orient Green has been bogged down primarily by unpaid dues from State-owned electricity distribution companies, mainly those of Tamil Nadu and Andhra Pradesh. Orient Green has an installed operational capacity of 417 MW of wind generators as at March 2021, according to its annual report.
The Shriram Group, through Shriram EPC, is currently the largest shareholder with a 49 per cent stake. US-based venture capital fund Bessemer Ventures Partners and Hong Kong-based private equity investment firm Olympus Capital Holdings Asia are the other significant investors. The general public — including retail investors — own 26 per cent in the company. The company’s market cap was ₹1,854 crore at Monday’s closing price.
Also read: Shriram Group announces succession plan; forms board of management
Queries sent to the Shriram Group remained unanswered.
The Shriram Group has businesses spread across sectors including commercial vehicle financing, consumer and enterprise financing, retail stock broking, life insurance, chit funds and distribution of investment and insurance products. The Group had recently consolidated all its financial services businesses under a single entity as part of a restructuring plan.
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