PTC plans to float $500 m power fund; eyes coal assets abroad

Power trading major PTC India Ltd is planning to establish a $500-million fund this fiscal year to finance power projects in the country. The company would use the Rs 500 crore ($105 million) it raised (in a sale of company shares last month) to start the fund.

The fund will buy equity in proposed Indian power projects, and PTC expects to market the power from these stations. The announcement of the proposed fund comes in the wake of the credit crunch being faced by a bevy of new generation projects on the anvil.

PTC, which is the country’s largest power trading firm, saw trading volume rise nearly 40 per cent in the financial year ended March 31. It expects volumes to grow steadily over the next few years as more generation capacity comes online and a greater amount of spare electricity is available for trading.

PTC also plans to enter into more coal-supply agreements with power plants in which it acquires stakes. The company is waiting to acquire overseas coal mines before getting into supply agreements with power plants. It is looking at assets that can give around 15 million tonnes coal a year. It has also identified some (undeveloped) mines in Australia and Indonesia, but are still under the negotiating stage.