India News
Search Web Directory
News Home
GMR Group in talks for stake sale in Chhattisgarh power plant
Posted on 19th October 2016
Mumbai/New Delhi: Infrastructure conglomerate GMR Group has initiated discussions with SembCorp Industries Ltd of Singapore and US-based Lone Star Funds for selling a significant stake in GMR Chhattisgarh Energy Ltd (GCEL), a 100% subsidiary of GMR Energy Ltd (GEL), three people familiar with the matter said. The move is part of the group’s efforts to bring down its debt that stood at Rs43,400 crore at the end of September.

GCEL has two power plants with combined capacity of 1370 MW at Raipur, Chhattisgarh, that commenced commercial operations in March.

“While SembCorp has been in talks with GMR for a while now, the discussion with Lone Star Funds is a new development and is exploratory in nature,” said one of the three people—a senior GMR Group executive who did not want to identified.

The second person, a banker, said SembCorp is keen to pick up stake in the project. He added that the absence of long-term power purchase agreements (PPAs) is a hurdle. These make the transaction viable given significant cost over-runs in the project.

Currently, GCEL has only short-term PPAs. It is hoping to sign long-term PPAs with state-owned utilities in Uttar Pradesh and Telangana. It has already bid for such agreements in the case of the former.

According to its most recent filings, GCEL has an overall debt of Rs8,290 crore and needs to start paying back money from March 2017. The three people said its enterprise value (EV) is close to Rs12,500 crore and includes two captive coal mines valued at Rs750 crore.

“During the normal course of business, We talk to various parties for different transactions. we would not like to comment on any specific transaction,” said a GMR Infra spokesperson.

Analysts say that GCEL will have to sign PPAs in the range of Rs3.80 per unit to make the project viable. A slightly lower tariff could be sustainable but only if banks agree on a moratorium and a possible restructuring.

“We are talking to banks; everyone understands that the current situation helps no one,” said the GMR executive.

“India is one of SembCorp’s key markets and an integral part of the company’s emerging markets strategy. We’re constantly on the lookout for suitable opportunities to grow our business in India especially in the areas of thermal power, renewable power, water treatment and urban development. However, we do not comment on specific opportunities,” a SembCorp spokesperson said. A spokesperson for Lone Star Funds declined comment.

The GMR Group, which has interests in airports, energy, transportation and urban infrastructure, is monetizing assets to repay creditors after years of debt-driven expansion.

In May, it sold a 30% stake in some of GMR Energy Ltd’s assets for $300 million (around Rs2,000 crore) to Malaysia’s largest electricity utility Tenaga Nasional Bhd. In July, it sold 74% stake in Maru Transmission Services Ltd and 49% in Aravali Transmission Services Ltd to Adani Transmission Ltd for Rs 100 crore.

Both SembCorp and Lone Star Funds were among the shortlisted bidders for SunEdison’s India assets which were acquired by Hyderabad-based Greenko Energy for $392 million.

The Singapore-based SembCorp Green Infra, a subsidiary of SembCorp Industries, has over 900 MW of wind and solar power assets in operation and under-development in southern, western and central India.

Last year, it acquired a controlling stake in Green Infra from IDFC Alternatives for Rs1,060 crore, marking its entry into India’s renewable energy market.

According to credit rating agency Crisil, India’s power generation capacity has grown at a compound average growth rate (CAGR) of 10% since 2009. Of this, the private sector contributed the most—close to 60% of the coal-based capacity—and invested Rs3.2 trillion.

Despite the growth in capacity, the demand for power from distribution utilities (power discoms) has grown barely at 0.4% during this period. At least 15% of capacities added by private firms are without long term PPAs, affecting their ability to service debt.

Related Companies: GMR Group   

Other Latest News
Brexit deal, divestment plans boost Sensex, Nifty
Posted on 19th October 2019
Equity market witnessed sixth consecutive session of gains with benchmark indices Sensex and Nifty-50 gaining over 0.6 per cent on positive global and domestic cues after Brexit deal and the Central government planning more PSU divestments to bridge the fiscal deficit gap.

Sensex gained 246.32 points or 0.63 per cent closing at 39,298.38 while the broader Nifty-50 gained 75.50 points or 0.65 per cent to close at 11,661.85.

Isro releases 1st illuminated image of moon surface taken by Chandrayaan 2
Posted on 19th October 2019
The Indian Research Space Organisation (ISRO) on Thursday released the first image of the surface of the moon captured by the Imaging Infrared Spectrometer (IIRS) payload on-board Chandrayaan 2.

"See the first illuminated image of the lunar surface acquired by #Chandrayaan2's IIRS payload. IIRS is designed to measure reflected sunlight from the lunar surface in narrow and contiguous spectral channels," ISRO tweeted along with the picture on its account.

EPFO to cover 400,000 employees in J&K: 5 Key benefits for workers of organized sector
Posted on 19th October 2019
NEW DELHI : Retirement fund manager Employees Provident Fund Organization (EPFO) will cover 400,000 organized sector employees in Jammu and Kashmir and Ladakh, effective 31 October, making them eligible for a series of social security benefits ranging from family and disability pension to higher life insurance, among others. It shall also reduce the employee cost for companies to some extent.

Strategic sale buzz: BHEL gains 27.5% in intra-day trade
Posted on 19th October 2019
Strategic sale buzz fuelled a sharp 27.5% rise on Friday in the share price of Bharat Heavy Electricals (BHEL) during the intra-day trade on BSE. The stock rose to Rs 56.80 on Friday, before closing at Rs 54.45, 22.2% higher than the previous day’s close. It had hit a 52-week low of Rs 41.35 on Wednesday, as the company battled through tough times stemming from execution delays and low order inflows.

ITC to develop value chain for chilli growers in Andhra Pradesh
Posted on 19th October 2019
The Agri Business Division of ITC Ltd has joined hands with the Andhra Pradesh government for improving farm value chain for chillies under public-private partnership mode covering Krishna, Guntur, Prakasam and Kurnool districts of the southern state. The collaboration will focus on developing an integrated agri extension platform for chilli value chain development, covering 10,000 acre in the first phase and another 100,000 acre in the near future.

» Post a FREE Classified Advertisement
Inviting Real Estate Agents, Job Placements Agents, Educational Institutes, Software Service Providers, Real Estate Builders, Marriage Bureaus, Travel Agents, Restaurant Owners, Health & Fitness Centers and other Local Businesses to Post a FREE Classified Advertisement on Classifieds Website.
Jobs in India India Real Estate Automobiles Matrimonials Beauty & Fitness

Add a comment for GMR Group in talks for stake sale in Chhattisgarh power plant
Please only use this form to enter comments on the above company. All comments are reviewed before they are displayed on the web site. Not all comments may be displayed. Check back with us to see if your comments have been displayed.
If you want us to email the comments posted by users, please Subscribe by email
Security Code*

Be the first person to write a business review for GMR Group in talks for stake sale in Chhattisgarh power plant

Most Read News

Daimler recalls hundreds of thousands of Mercedes-Benz diesel vehicles

SBI re-enters list of India's top-10 most valued firms

Mary Kom signs off with bronze in World Boxing Championships

Infosys meets Street expectations; raises revenue guidance

Air India Assets Holding raises another Rs 7,985 cr

More India News

  India Web Directory
Business Profiles
Automotive Directory
IT/ITES/BPO Directory
Hotel Directory
Health Directory
Business Directory
Gems & Jewellery
Education Directory
Real Estate Directory
Agriculture Directory
Logistics Directory
Yellow Pages
NRI Guide
Photo Galleries
Global Web Directory
*** FREE India Classifieds
Order Premium Listings
Submit a Site
Business Reviews
About us
Link to us
Contact us
Google Search Keywords: India Catalog, IndiaCatalog, India Web Directory
    © 1999 - 2019
    All Rights Reserved
Privacy Statement