The Tata Power Company is working on a range of initiatives that will cut debt in half, and reduce losses at Mundra power plant, chairman N Chandrasekaran told shareholders at the annual general meet on Thursday. Tata will also sell non-core and coal assets overseas, Mr Chandrasekaran added.
The Tata group utility, which along with its subsidiaries and joint venture companies has an installed capacity of 12,742 megawatts, aims to cut debt and the shareholders approved a rs 2600 crore preference share issue to promoters Tata Sons.
“We will end this year with a debt of around Rs 25,000 crore, bringing down the debt- to-equity ratio of the company to close to 1. This will also move the net debt to earnings before interest, tax, depreciation and amortization ratio to closer to 3, significantly strengthening our balance sheet and lowering financing costs,” Chandrasekaran told shareholders.
In 2017, Tata Power decided to reduce its debt pile of Rs 49000 crore in half and In March, the company’s net debt was Rs 43,559 crore. “We have a clear plan to achieve our target by the end of this fiscal year,” the chairman said.