Power Finance Corporation Ltd (PFC) on Wednesday said it is considering offering ‘transition loan’ of about Rs 17,330 crore to six ailing state electricity distribution utilities.
These loans are not part of the Rs 1.20-lakh crore re-structuring packages that is under inter-ministerial consultation.
“We will give a small amount of the loan, which will be in the form of ‘transition loan’ to the Six states that are having difficulty. The loans in terms of payment will be – up to three years moratorium and up to seven years re-payment – depending up to what a State is looking for,” said PFC Chairman and Managing Director Satnam Singh.
PFC has total exposure of Rs 1,890 crore short-term loans and Rs 5,820 crore of long-term loans to State utilities. “So far, there is no NPA or written off any debt of state power utility,” he added.
He was speaking to the media after considering the first quarter results.
The company has reported 42 per cent increase in first quarter net profit at Rs 972 crore.
FUNDING VIDEOCON
PFC has decided to grant loan of Rs 2,200 crore to Videocon Industries for its Mozambique natural gas project. This is the first overseas project PFC would be funding.
PRIVATE EQUITY FUND
PFC has selected four partners – Tata Capital, Religare, Reliance Capital and Edelweiss (in order of merit) – to join hands for a proposed $1 billion private equity fund.
Discussions will start with Tata Capital first and if that doesn’t work out, PFC will move to the second player. The fund is likely to have a start-up capital of $300 million to be utilised for funding power projects. PFC will hold 49 per cent in the fund, while the partner will have 51 per cent stake.