CESC seeks Rs 1,000 cr PE infusion

RPG Enterprises flagship, CESC Ltd, is seeking to raise Rs 1,000 crore from private equity (PE) players for three projects by its subsidiary Haldia Energy (HEL).

The power major is looking for PE infusion for two 600 Mw projects at Haldia in West

Bengal and Chandrapur in Maharashtra and another 1,300 Mw plant at Talcher in Orissa.

“We are looking for PE investments in three projects by HEL, which will produce about 2,500 Mw at Rs 12,500 crore. For this, we are in talks with domestic and overseas firms on the premium and exit clause,” CESC Vice-Chairman Sanjiv Goenka said here today.

Goenka, however, was reluctant to divulge the number of PE firms the power generator was speaking to, but said the dialogue process would be complete by February 15 next year. “The selection of merchant bankers is also on course,” he added.

The company has also decided to re-work the distribution split for its Haldia plant, which was earlier intended primarily for merchant users. Instead, more supply will now be routed to Kolkata, where CESC is the main power supplier.

“I feel that this region (Kolkata) has a high potential for power consumption. We have decided to give 400 Mw of power to Kolkata, as a result of that, and if demand grows, we will increase this,” said Goenka.

Financial closure for the Haldia and Chandrapur projects has already been achieved, and for the Orissa project it will be done as soon as the coal linkages are finalised, he said.

For CESC’s three other projects – 2,000 Mw plant at Pirpainty in Bihar, 1,000 Mw unit at Dumka in Jharkhand and 1,320 Mw Balagarh project in West Bengal – a separate subsidiary could be floated, although the final decision is yet to made.

“We have applied to the Centre for permission of coal linkage in our Balagarh plant in West Bengal. Things are not happening at a swift pace there, as the standing linkage committee has not met for the last 16 months,” said Goenka.

Company net profit up 23 per cent

CESC has reported a 23 per cent jump in net profit to '155 crore for the quarter ended September 30, compared to '126 crore for the same quarter last year. The firm’s net sales, during the period under review, also saw an increase of 14.86 per cent to '1,090 crore, against '949 crore for the same quarter last year. “Generation increased by 15 per cent due to commissioning and satisfactory performance of the third unit of Budge Budge, in spite of reduction in imports by 12 per cent,” CESC said in a statement.