New Delhi, Sept. 12: Power minister Anant G. Geete has assured National Thermal Power Corporation (NTPC) that his ministry will take up the issue of budgetary support for the public sector giant with the finance ministry.
He has also promised the PSU chief and senior officials that the demand for offloading a 10 per cent share through an initial public offer (IPO) will also be taken up with the Securities and Exchange Board of India (Sebi). The Sebi guidelines do not permit offloading of more than a 5 per cent stake through an IPO for the first time.
The minister also said that a decision on coming out with an IPO of Power Grid Corporation of India Ltd (PGCIL) would also be taken soon. “We will try to have an IPO of NTPC during the current financial year, if all the necessary approvals are received from all the concerned agencies,” he said.
The minister also promised to hike the authorised share capital of NTPC from Rs 8,000 crore to Rs 10,000 crore.
Earlier today, Geete met the senior officials of two PSUs, NTPC and PGCIL. Speaking to the NTPC officials Geete said, “We will support you (NTPC) to achieve the target of 41,000 megawatt capacity generation. This is important since the demand for power is bound to go up over the next few years.”
The public sector power company has decided to go for an IPO anticipating that tariff policy to be announced by the government later this year may strain its efforts to generate capital through internal resources. NTPC needs about Rs 80,000 crore investment over the next 10 years to add 20,000 MW generation capacity. NTPC has tied up Rs 6,289 crore from financial institutions and banks to fund part of its projects.
NTPC had sought an equity support of Rs 13,000 crore from government in the Tenth Plan proposal. The matter was raised at the Planning Commission but finally the finance ministry approved only Rs 5,000 crore. NTPC has set a target to generate 20,000 megawatt by 2012.
NTPC had an installed capacity of 19,935 MW as on March 31, 2002, accounting for nearly 20 per cent of the country’s installed capacity.