Power Trading Corpn Plans To Raise Capital Base

The Power Trading Corporation (PTC) plans to increase its capital base to around Rs 800 crore over the next few years to overcome the problems of non-payment of dues from state electricity boards.

Immediately the Corporation, which is buying power from the 330 mw Chukha project in Bhutan, plans to increase its capital base to Rs 40 crore from the present level of Rs 6 crore.

Speaking at a press conference, R K Madan chairman of the PTC said "PTC will increase its equity base to Rs 40 crore this financial year to be able to absorb payment defaults of beneficiaries."

 

This would be substantially hiked as its business also grows. Under the strategy Madan said that PTC will focus in raising its share in the quantum of power traded in the country from the present five per cent to 20 per cent within the next eight years.

PTC has faced problems in receiving payments from some of the beneficiary states electricity boards including West Bengal, Bihar and Sikkim for sourcing power from the Chukha project. Madan said that with a small capital base the company runs a huge risk if the payments from states are delayed.

As PTC plans to limit its risk exposure to one month's payments, the monthly payment towards the Chukha project alone ranges from Rs 33 crore to Rs 15 crore, while its capital base is only Rs 6 crore.

At present, 60 per cent of the total equity in PTC is held by Power Grid Corporation, National Thermal Power Corporation and Power Finance Corporation, while the balance 40 per cent will be picked by FIs.

IDBI , IDFC and LIC have already agreed to invest more than Rs 5 crore each in the initial year. The remaining Rs 18 crore would come from the PGC, NTPC and PFC_-which would enable PTC to maintain equity ratio.

Once the other projects_-like the 1020mw Tala project also in Bhutan__comes on stream PTC would adequately hike its capital base to meet the risk requirements.