|
| PowerGrid to float overseas subsidiary by early 2011 |
| Sudheer Pal Singh / New Delhi Jan 27, 2010, 00:53 IST |
|
Powergrid Corporation of India Ltd (PGCIL), India’s largest power transmission utility, is set to float its overseas subsidiary by early next year. The move is aimed at opportunities outside the country.
“Currently, our hands are full in India. We are open for acquisitions outside. By early next year, we would form the subsidiary that would become our overseas arm. It would operate on the lines of ONGC Videsh Ltd (OVL),” said a senior official from the company. OVL is the overseas arm of the oil and gas explorer, Oil and Natural Gas Corporation (ONGC).
With increasing private participation in the power sector, the public sector behemoth’s share in domestic power transmission is likely to come down, say experts. “Eventually, if you want to grow, you have to look outside,” added the official.
The company has plans to launch a Follow-on Public Offer (FPO) in the second quarter of the coming financial year, Chairman and Managing Director S K Chaturvedi had said earlier this week. The company is planning to raise around Rs 3,000 crore through the issue, which would include a partial stake sale by the government. The power ministry is likely to take up Powergrid’s issue after the follow-on offers of NTPC Ltd and Rural Electrification Corporation.
The navratna public sector undertaking has already formed an international business division. After having completed the Tala power transmission project in 2006, which enables India to trade electricity with Nepal, the company is now setting up a 1,000-Mw undersea transmission link with Sri Lanka and a 250-Mw link with Bangladesh, apart from eyeing project partnerships in Bhutan, Myanmar, the US and Europe.
Powergrid’s overseas plans include taking over the existing transmission network of developing countries which are trying to privatise their transmission assets, to bring in efficiency, and eventually help these expand.
Earlier, the company had a failed attempt at acquiring a stake in the Philippines power transmission network. The deal fell after one of its consortium partners opted to move out.
Experts believe creating an overseas presence is a wise move for Powergrid, especially in the long term, but only after domestic business opportunities are fully captured. “The company needs to focus on augmenting growth in the Indian market. Huge generation capacities are being created here which are not matching transmission capacity. But, in the long term, the company should leverage capacities beyond India. It would also help the company to build quality manpower,” said Arvind Mahajan, Executive Director, KPMG Advisory Services.
The transmission utility owns and operates around 72,000 circuit kilometres of transmission lines and alone transmits over 45 per cent of the total power generated in the country. The company plans to invest Rs 55,000 crore to ramp up its inter-regional power transfer capacity to over 37,000 Mw by the end of the current Plan period (March 2012).
|
|
|
|
|
|
|
|
|
|
 Read Business news in |  |
|
|
|
|
|
|
Advertisements |
|
|
|
|
|
|
|
|
|
|
Content Guide
