NCC Ltd, the Hyderabad-based engineering and construction company, has achieved financial closure for the 1,320 MW, Rs 7,000-crore greenfield thermal power plant coming up in Nellore district of Andhra Pradesh.
“The debt component of Rs 5,300 crore is led by a consortium of Rural Electrification Corporation with Rs 1,900 crore, Power Finance Corporation pitching in with Rs 1,700 crore along with ICICI Bank and others. We hope to announce this major milestone for project implementation during the month,” Mr Y.D. Murthy, Executive Vice President, Finance, NCC Ltd, told Business Line .
The project is being executed through a special purpose vehicle in a joint venture with Gayatri Projects, another Hyderabad-based infrastructure company. The power project mandate was secured from Nelcast Ltd, which had the permission to develop the project.
The equity component has also been completed. While NCC will chip in with Rs 350 crore, Gayatri and other sources have closed in with the rest. The lenders had insisted that about 35 per cent of the equity component should come from the promoters and this objective has been achieved, Mr Muthy explained.
The company has taken a few decisive steps towards implementation of the project. It has chosen Harbin of China for boiler supplies and NCC itself would be the EPC and balance of plant services provider. It is proposed to commission unit one in 39 months and unit two in 42 months. All mandatory clearances for the project are in place, he said.
As a part of the project execution, NCC would get the mandate for Rs 5,000 crore EPC contract for the power plant. The company may consider taking up second phase of 1,320 MW at the same location.
Equity dilution
The company management is also considering some dilution of equity to raise funds for some of the ongoing projects. This could be either at the holding company or at the special purpose vehicle level. The idea is to bring down the debt, the company official said.