| CESC chairman R. P Goenka, vice-chairman Sanjiv Goenka and managing director Sumantra Banerjee in Calcutta on Friday. Picture by Kishore Roy Chowdhury
Calcutta, Sept. 19: CESC, the RPG-controlled power utility, has decided to set up a 250-MW power plant at a cost of Rs 1,000 crore in Bengal.
The company is currently carrying out an internal study to find a location for the power plant. It has also initiated talks with banks and financial institutions for funding the project. A financial consultant will be appointed soon.
“The new power plant will be funded through loans, internal accruals and proceeds from the sale of non-performing assets. The complete proposal will take shape within a couple of months,” vice-chairman Sanjiv Goenka said here today.
The planned increase in generation capacity may see the revival of the Balagarh power plant, which is lying dormant for couple of years. “We may revive Balagarh or start a greenfield power plant,” Goenka said.
The move will also help fill the gap in output if the company goes ahead with its plan to close down Mulajore and Cossipore units, which now generate 536 million units.
“The need for power in Bengal is increasing and there is a mismatch between supply and demand. It is necessary to increase generation,” Goenka said.
The company will offer voluntary retirement schemes to 4,500 employees of Mulajore and Cossipore plants. The funds outflow on account of VRS is yet to be worked out.
The company hopes to earn a positive PBT (profit before tax) this fiscal. It had pruned transmission and distribution losses to 18.8 per cent in 2002-03.
The company’s debt restructuring exercise will begin within a few weeks, he said. The company is saddled with a debt burden of Rs 3,300 crore.
According to the debt restructuring proposal, promoters are required to invest Rs 50 crore in the company’s equity against which 33 lakh preferential shares will be issued. The investment will be done through Hilltop Investments, Jubilee Investments and Adapt Investments, Goenka said.
The company has priced the shares at Rs 49.70 which is almost Rs 6 more than the share price currently being quoted on the bourses.
Demand for poll
CESC shareholders have demanded a poll on all the resolutions, including profit and loss accounts of 2002-03. The poll will take place tomorrow.
They also demanded a poll on the accounts of 2000-01 and 2001-02. CESC today conducted three meetings — the first one for getting the accounts of 2000-01 approved, the second one for the accounts of 2001-02 (which was adjourned last year) and the third one for the last financial year.
The accounts for 2000-01 and 2001-02 were recast following the Supreme Court’s judgement on tariff revision. The company had called the meeting of the shareholders to approve the accounts.