L&T sells 1,400 Mw Nabha power plant to Torrent for Rs 3,660 crore

Infrastructure major L&T announced its wholly owned subsidiary, L&T Power Development, has agreed to sell 100 per cent stake in Nabha Power Ltd (NPL), which owns and operates the 1,400 megawatt Nabha power plant in Punjab, to Torrent Power for Rs 3,660 crore.

 

L&T said in a statement the divestment is a value-driven monetisation exercise and the transaction is aligned with L&T’s broader strategy to exit the development projects business. NPL recorded a turnover of Rs 4,421 crore and a net worth of Rs 3,553 crore for the last financial year 2024-25.

 

“The divestment of NPL aligns with L&T’s strategic objective of unlocking value to strengthen our robust core businesses. This move positions us to create long-term value for all our stakeholders — business partners, shareholders and employees,” L&T Chairman S N Subrahmanyan said.

 

 

The coal-based Nabha power plant houses two supercritical units of 700 megawatt capacity each at Rajpura in Patiala district, Punjab. Commissioned in 2014, the plant was set up under Case-II competitive bidding guidelines of the government. It operates under a 25-year power purchase agreement.

 

The plant has a long-term fuel supply agreement (FSA) with South Eastern Coalfields Ltd (SECL) and Northern Coalfields Ltd (NCL) for 2.775 million tonnes and 2.464 million tonnes, respectively, along with mechanisms for alternate coal procurement to address any supply shortfall.

 

The plant’s equipment is designed to blend domestic and imported coal. It had achieved a plant availability factor (PAF) of 95.36 per cent in 2024-25 and a plant load factor (PLF) of 94.33 per cent in July 2024.

 

For Torrent, the acquisition marks the company’s entry into the high-growth power market of northern India. Post completion of the acquisition, Torrent’s operational capacity will increase from the present around 5 gigawatt to 6.4 gigawatt, the company said in a statement.

 

“Leveraging our proven expertise in managing power assets, this addition provides a robust platform to enhance scale, improve operational efficiency, and strengthen cash-flow stability,” Torrent Chairman Samir Mehta said.

 

Accounting and consultancy firm EY acted as the exclusive merger and acquisition (M&A) investment banking adviser to L&T for this transaction. “There is again a huge interest in coal-fired power projects among investors due to the government’s renewed focus on thermal power, which is now deemed critical for grid stability considering significant additions in renewable capacity,” Kuljit Singh and Jitesh Khatrani, investment banking partners at EY, said.