The Business Bytes
NEW DELHI, APRIL 15, 2024 (TBB BUREAU): In a significant development for the energy sector, billionaire Anil Agarwal-led mining conglomerate Vedanta Ltd has successfully secured a long-term loan of Rs 3,918 crore from Power Finance Corporation Ltd (PFC), according to sources familiar with the matter.
The 11-year term loan marks a crucial milestone for Vedanta, facilitating the acceleration of its power projects’ completion timeline. Sources indicate that the group is strategically aiming to elevate the operating capacity of its power business in India to 4.8 gigawatts by the fiscal year 2027.
This financing announcement follows Vedanta group’s recent acquisition of Meenakshi Energy Ltd on December 28 through an insolvency process overseen by the National Company Law Tribunal (NCLT). Meenakshi Energy possesses a coal-based power plant located in Nellore, Andhra Pradesh, which Vedanta plans to utilize for supplying power to merchants.
With the acquisition of Meenakshi Energy and Athena Power in Chhattisgarh, both with substantial capacities, Vedanta will primarily allocate the newly secured funds to these key power plants. This move aligns with the company’s renewed focus on bolstering its energy portfolio in India.
In addition to the recent loan agreement, Vedanta had previously acquired Athena Chhattisgarh Power Ltd in August 2022 for Rs 565 crore, underscoring its commitment to meeting its captive power requirements. Athena Chhattisgarh operates a coal-based power plant with a significant capacity located in the Janjgir Champa district.
Vedanta’s strategic shift towards energy generation over the past couple of years has been noticeable. The company’s subsidiary, Serentica Renewables, in which Sterlite Power holds a stake, announced plans last month to invest Rs 25,000 crore to expand its renewable energy projects portfolio to approximately 4 gigawatts by June 2025.
Notably, Serentica had received Rs 2,600 crore from PFC in September for its hybrid renewable energy projects in Karnataka, dedicated to meeting the captive energy needs of Vedanta group companies.
With its diversified operations, Vedanta has recently achieved milestones such as the commissioning of a 1.5 million tonnes per annum expansion at its alumina refinery in Lanjigarh, Odisha, and the commencement of mining operations at the Bicholim mineral block by Vedanta Sesa Goa, signaling robust growth plans for the company.
The strategic moves by Vedanta underscore its commitment to enhancing its presence in the energy sector while leveraging its existing assets and resources for sustainable growth.
