DVC plans acquisition, IPO, to pump Rs 3000cr on distribution

Kolkata: Damodar Valley Corporation (DVC) has sought an assistance of Rs 9,000 crore from the World Bank to give shape to its ambitious plans, including low-tension distribution network in Jharkhand.

The corporation, which registered a net profit of Rs 392 crore in 2012-13, is also mulling acquisition of a power producer.

"We have sought some Rs 9000 crore from the World Bank for five projects including Balpahari Dam, low tension distribution network in Jharkhand, solar power, upgradation of transmission and distribution network," DVC chairman R N Sen said.

DVC is not into low tension power distribution so far and it would be its foray into the segment after new licensing policy.

"We will establish low tension (retail power consumers) network in our command area of eight districts of Jharkhand at an estimated cost of Rs 3,000 crore," Sen said.

Speaking of the acquisition, Sen said there had been a proposal for takeover of an IPP from banks which are under stress.

"The talks are at a preliminary stage. We are working on a viable model," DVC director finance T K Gupta said without divulging further details.

According to indication, DVC will be a stakeholder along with bankers with operator right.

DVC had already begun the process of restructuring, including hiving off the generation into a new company that may hit capital market by 2018.

The power demand slowdown forced DVC to scale down its generation by some 1000 MW and yet having a surplus of 900 MW.

"We are exporting power with short term PPAs and once the southern corridor is opened up, we will export power to south India," Sen said.

PTI