Proactive Investors - Run By Investors For Investors

OPG Power draws line under Gujarat power station, to focus on Chennai and solar

The news at Chennai is more encouraging as the price of seaborne coal has fallen back
Solar capacity is expanding

India-based power utility OPG Ventures PLC (LON:OPG) has written off its Gujarat power station after a series of ongoing disputes.

Efforts in future will be directed toward the Chennai power plant and OPG’s growing solar capacity. Profits here for the year to March were £6.2mln while revenues rose by 3% to £140mln. The Gujarat write-down, however, meant a loss for the year of £100.9mln (£23.1mln profit).

READ: OPG Power Ventures sees record production in 2018 as tariffs improve for 2019

A sharp rise in seaborne coal prices and escalating disputes with the Gujarat authorities and electricity distribution companies meant debt repayment deadlines had been missed. No more cash will be spent on the Gujarat operation, OPG added.

The news at Chennai is more encouraging as the price of seaborne coal has fallen back and the loan on the first generator built at Chennai is on schedule to be paid back fully in December.

Four solar projects at Karnataka, meanwhile, are ramping up to full capacity of 62Mw.

Borrowings at the end of the March were £93.5mln, down from £321mln which reflects the absence of the Gujarat loans.

To preserve cash, there is a scrip rather than cash dividend for the year.

Arvind Gupta, executive chairman: “We are already benefitting from reduced coal prices following the FY18 spike and expect to be able to demonstrate a clear path to profitability in FY19.

“Our focus will remain on repaying the long-term debt on the Chennai plants and look forward to Unit 1 being debt free later this year with the remaining units following within five years.”

View full OPG profile View Profile

OPG Power Ventures PLC Timeline

Related Articles

A visualisation of the CNG 200 Optimum ship
March 26 2019
GEV's unique CNG 200 Optimum ships could establish a new gas transportation market.
High Peak chairman Andy Carroll at a CEO Session
November 22 2018
High Peak claims royalties from oil and gas endeavours on Australian and US landholdings.
Biomass power station
March 27 2019
The AIM-listed renewable energy and forestry management business has developed a fuel substitute called CoalSwitch made from waste wood normally left to decompose following forestry operations

© Proactive Investors 2019

Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use