will continue to look for investment opportunities, the group chairman told shareholders on Thursday.
“It is important that we continue to invest wisely and build an enviable portfolio of power assets. Given the stress in the power sector, we are anticipating consolidation in the domestic space, which will offer us good prospects for investing for the future. We are also evaluating various opportunities involving next generation technologies, which are going to be disruptive in nature in the energy space,” said Sajjan Jindal, chairman and managing director, at the company’s annual general meeting.
These investments, Jindal said, would be to build a sustainable energy business that could withstand present and future challenges.
On the current demand scenario in the power sector, Jindal said: “During 2016-17, we saw a continuation of the trend of poor power demand, translating into weak merchant offtake and lower tariffs (rates). This got compounded due to increasing prices of imported coal, impacting our standalone business.”
He said India’s power sector
had a huge opportunity to grow but was presently struggling with multiple challenges like sluggish industrial demand, unsustainable capacities, lack of long-term power purchase agreements and poor financial health of distribution companies.
He also raised concerns over the financial viability of solar energy projects, where bids have touched all-time lows. “Part of the reduction can be attributed to declining equipment costs but it also raises questions about the long-term viability of projects at such low tariffs. The government has set ambitious targets for setting up renewable capacities and the viability of projects will be a crucial factor to achieve the long-term goal of energy security,” he said.