THDC India Limited, a leading government-owned power development company and subsidiary of NTPC Ltd, has officially approved plans to raise funds up to 15 billion rupees. This significant financial move aims to bolster the company’s capital resources, support ongoing and upcoming infrastructure projects, and strengthen its market position in the power generation sector. The approval reflects THDC India’s proactive strategy to enhance its financial flexibility and maintain steady growth amid evolving energy demands.
Key Financial Move Highlights:
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The approved funds raising amount is up to 15 billion rupees, accessible through market channels such as bond issuance or other financial instruments.
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The fundraising is intended to partially finance debt obligations and ongoing capital expenditure requirements for current construction projects.
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This decision aligns with prior successful fundraises, including corporate bonds, that have contributed to THDC’s robust capital structure.
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The company holds a strong credit rating (CARE AA/Stable, IND AA/Positive) which supports investor confidence in its debt instruments.
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The funds will enhance THDC’s capability to refinance existing loans, optimizing its debt profile and reducing financing costs.
Strategic Importance of Fundraising:
THDC India has been expanding its energy capacity diligently, with a current operational portfolio of approximately 1,587 MW, including hydro, solar, and wind power installations. The recent approval comes at a critical time as the company also pursues new projects such as a 53.9 MW solar plant in Karnataka and ambitious pumped storage hydro storage projects aggregating nearly 6,790 MW in Maharashtra.
The infusion of new capital will empower THDC to:
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Accelerate construction and commissioning timelines of ongoing power projects.
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Manage debt maturities effectively, including repayments scheduled in the near future.
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Invest selectively in renewable energy expansions, sustaining alignment with national clean energy targets.
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Seize emerging investment opportunities in both conventional and renewable sectors.
Background and Ongoing Projects:
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As a Schedule A Mini Ratna Central Public Sector Enterprise, THDC India has a remarkable history of profitability and operational efficiency. Its notable projects include the Tehri Hydropower Project (1,000 MW), Koteshwar HEP, and several wind and solar ventures. The company also holds a portfolio of 13 projects under various stages of development, totaling about 5,539 MW capacity, including cross-border initiatives in Bhutan.
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In addition to hydropower, THDC’s strategic focus now involves renewable energy projects and new technology adoption such as pumped storage. Some key projects recently advanced or in planning phases include:
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The 53.9 MW solar project in Karnataka, for which THDC is inviting bids and expects completion within 12 months.
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Large-scale pumped hydro storage projects in Maharashtra, backed by state government collaboration.
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Acquisition and development of coal-based thermal power plants to diversify the energy mix.
Financial Health and Credibility:
THDC India benefits from a strong credit rating profile with CARE Ratings Limited assigning an AA rating with stable outlook and India Ratings & Research endorsing an IND AA rating with a positive outlook. The company’s prudent financial management and consistent profitability underscore its ability to raise funds at competitive terms. With manageable debt repayment schedules and stable cash flows, THDC is well-positioned to utilize the raised capital efficiently.
Implications for Investors and Market:
The fundraising approval is likely to be viewed positively by analysts and investors, as it signals THDC’s continued growth trajectory and proactive capital management. Market confidence in existing corporate bonds issued by THDC has been strong, with yields remaining attractive due to the company’s creditworthiness and steady earnings.
Source: Reuters
