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The Tata Power Company Limited, India's largest integrated private power company, has been reaffirmed its corporate credit rating to BB- with ‘positive’ outlook by Standard & Poors’. Standard & Poors’ believes that the Company’s capital expenditure plans will remain significant and project completion risks of Maithon Power project and the Mundra UMPP is continuing although limited due to considerable progress. Standard & Poors’ further attributes this rating to Tata Power's good operating efficiency, competitive position of its core licensed operations and adequate liquidity of the company.
The Maithon Power project which has a capacity of 1050 MW has achieved more than 85% completion and the Mundra UMPP, a 4000 MW project has progressed considerably well with more than 60% completion, thereby moving towards addressing the ever increasing demand of electricity in India.
In addition, Tata Power plans to expand its generation capacity to 6,905 MW over and above Maithon and Mundra Project. The company has made a significant progress in acquiring the required land for many of its captive (Domestic) and imported coal-based projects in India. The construction work for some of the projects is expected to start shortly.
The positive outlook on the rating reflects Standard &Poor’s expectation that the company's development projects will continue to make progress and the company's financial metrics will improve. It also expects the company to benefit from the favourable outlook for coal demand and higher coal production by the Coal Op Cos.
Standard & Poors’ has noted the extraordinary tax payments made for previous years by its 30% owned Indonesian coal producers and expects higher cash flows from it in future. Commissioning of Maithon's 525 MW units is also expected in next 6 months and Mundra's first 800 MW unit by September 2011.
About Tata Power:
Tata Power is India's largest integrated private sector power utility with an installed generation capacity of about 3000 MW and a presence in all the segments of the power sector viz Generation (thermal, hydro, solar and wind), Transmission, Distribution and Trading. The Company has successful public-private partnerships in Generation, Transmission and Distribution - “North Delhi Power Limited” with Delhi Vidyut Board for distribution in North Delhi, ‘Powerlinks Transmission Ltd.’ with Power Grid Corporation of India Ltd. for evacuation of Power from Tala hydro plant in Bhutan to Delhi and ‘Maithon Power Ltd.’ with Damodar Valley Corporation for a 1050 MW Mega Power Project at Jharkhand. It has acquired 30% stake in Coal Companies at Indonesia and is developing the first 4000 MW Ultra Mega Power Project at Mundra (Gujarat) based on super-critical technology. With its track record of technology leadership, customer care and redefining contours of the Indian power sector, Tata Power is poised for a five-fold growth and committed to ‘lighting up lives’ for generations to come.
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