Resolution of eight stressed power projects delayed

Power Finance Corporation's (PFC's) attempt to resolve at least eight stressed power assets by mid-November has got pushed back to a later date.

The eight stressed assets together comprise 9,040 megawatt (mw) or 9.04 gigawatt (gw). They are KSK Mahanadi (2,400 mw), Jhabua Power (600 mw), RKM Powergen (550 mw), Bharat Utkal (700 mw), Jal Power (120 mw), RattanIndia Amravati (1,350 mw), RattanIndia Nashik (1,350 mw), Essar Mahan (600 mw) and GMR Raikheda (1,370 mw).

In these eight power assets, the total exposure of all lenders put together, including PFC, stands at Rs 21,876 crore.

"There are some issues and discussions are underway to move towards resolution of these stressed power assets. At the moment, none of these eight stressed assets has been resolved," a senior PFC told DNA Money.

In March 2017, the Union government had classified 34 power plants as "stressed assets" which included these eight plants.

Though the official didn't divulge the timeframe by when these power assets would be settled, stating a specific timeline cannot be easily stated. However, the official said that things are moving in a positive direction, and an outcome may come soon.

"In certain cases, the promoters themselves have agreed to make a one-time settlement. We are working towards that too," the official said.

These one-time settlement offers are from the managements of Indiabulls Amaravati and Essar Mahan.

Similarly, a resolution for KSK Mahanadi is in the final stages. There are one-time settlement offers for Jhabua Power, RattanIndia Amravati and RattanIndia Nashik too. PFC, along with other lenders, is still restructuring RKM Powergen's debt pile. For Jal Power, a public sector undertaking or even Sikkim government may acquire the project.

"Even lenders have to be on the same page to come to a resolution. Apart from us, there are other banks with whom we are in talks," said the official.

In case of Bharat Utkal, the National Company Law Tribunal will take its course. Bidders have been finalised for GMR Raikheda.

Once these stressed power assets get resolved, though PFC will be able to put behind a Herculean task to revive these projects. However, it would be at a cost of up to 52% haircut, "provisions for which have been made in the books", the official said.

PFC’S REVIVAL ATTEMPT

• 9.04 gw – the eight projects comprise
   
• Rs 21,876 cr – Total exposure of lenders to these power plants