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Wednesday, August 23, 2006

Bhoruka lines up Rs 580cr expansion plan

The Bangalore-based independent power producer, Bhoruka Power Corporation, which specialises in mini hydel and wind power projects, is planning to invest around Rs 580 crore (Rs 5.80 billion) by 2009 on new projects, reports Business Standard.

It plans to set up power projects with a combined capacity of 110 mw in both – hydel and wind energy sector – in Karnataka and Haryana.

Of the proposed Rs 580 crore investment, 70% will be financed by consortium of banks and financial institutions. Of the remaining 30% (Rs 170 crore (Rs 1.70 billion)), the company will contribute Rs 70 crore (Rs 700 million) through internal accruals while the balance Rs 100 crore (Rs 1 billion) will be either raised through a public issue or from private equity funds.

“A decision on the initial public offer, IPO, will be taken in the 6-9 months. Work on some of the projects has already commenced. By 2009 end, the company will cross 200 mw capacity, making us a significant player in the renewable energy sector,” Bhoruka Power Corporation managing director S Chandrashekar said.

The company, so far, has commissioned various projects to generate 90 mw. The proposed investment of Rs 580 crore will be used to set up mini hydel projects (60 mw) and wind farms (50 mw).

“Except for a 6 mw mini hydel project in Haryana, the rest of the projects, including the wind-based ones, will be commissioned in Karnataka. The wind farms will be located in Chitradurga district, considered as one of the best regions for harnessing wind power,” he pointed out.

The company recorded a turnover of Rs 60 crore (Rs 600 million) in the 2005-06. “Its profit after tax, PAT, stood at Rs 22 crore (Rs 220 million) with another Rs 8 crore (Rs 80 million) coming from other income. By 2009, we will be in a position to clock Rs 70 crore PAT after completing all the projects,” Chandrashekar stated.

Bhoruka Power Corporation has successfully bid for 25-mw mini hydel power project in Himachal Pradesh. Partnering global major Alstom, it has bid for a 42-mw hydel renovation project under the LROT (lease, rehabilitate, operate and transfer) scheme at Uttaranchal.

“These two projects entail a combined investment of Rs 270 crore (Rs 2.70 billion). But the two projects are yet to crystallise. Once we commission these two projects, our power production capacity will reach 267 mw,” he said.

The company’s future projects include a 300 mw thermal power plant in Karnataka. “This proposed thermal power plant will use imported coal. But its implementation will depend on reforms in the power sector. We are optimistic about the reforms,” he added.

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