Haldia Petro buys out L&T in power JV
The 10-year joint venture produced 116MW for HPL's operations. The initial agreement said that HPL could buy out L&T's stake in 2020 at suitable prices. Both the parties decided to go ahead with a buy-out now.
HPLCL registered a net profit of Rs 76 crore last fiscal. HPL planned to invest in HPLCL to improve the energy efficiency of the plant by utilising alternative feedstock that matched its expansion plans.
It could use mixed gases in place of naphtha for power generation, said Swapan Bhowmik, chief executive officer of HPL.The company currently used 70MW power from HPLCL.
Its energy requirements were estimated to rise post its 30 per cent capacity expansion project that is likely to be commissioned by end of 2008.
The total installed capacity will be 1.7 million tonnes per annum after expansion. The petrochemical major was expecting a turnover of Rs8600 crore for 2007-08 as against Rs 8200 crore achieved in the last fiscal.
Rising naphtha prices had, however, eaten into its earnings before interest, taxes, depreciation and amortization (EBITDA) margins at Rs 933 crore for FY08, against Rs 1421 crore in the previous fiscal. Profit after tax for FY08 was estimated to touch Rs 262 crore, down from Rs 581 crore in FY07. International prices of naphtha had risen to $918 per ton now.