With a consolidated debt of Rs. 38,618 crore on its books, private power utility Tata Power is mulling dilution of its non-core investments to reduce the debt burden.
“The company will relook at its non-core investments from time to time to see whether they can be rationalised,” Tata Power chairman Cyrus Mistry told shareholders at the company’s 95th annual general meeting.
“The decision (of offloading stake in TTML) taken by the board was unfortunate as the investment has not paid dividend. We will relook at our non-core investments to see how they can be rationalised,” Mistry said in reply to a shareholder’s query about Docomo selling its entire stake in Tata Teleservices (Maharashtra) in which Tata Power has 7.02% stake.
Tata Power’s consolidated net debt stood at Rs. 35,892 crore in FY13.
Mistry said the company is also re-looking at investment in Nelco, Tata Ceramics, Tata Projects, among others.
To reduce its debt, the company in 2013-14 had also signed an agreement to sell 30% stake in PT Arutmin mine in Indonesia and associated companies in the coal trading and infrastructure.
“The aggregate consideration for Tata Power’s 30% stake is $510 million and we expect the process will be completed this fiscal itself,” said Anil Sardana anaging director, Tata Power.
“After selling stake in the mines, raising Rs. 1,993.38 crore through rights issue and other internal resource generation, we think our debt-equity ratio will come to a normative. Therefore we may not look at selling any assets. But we will definitely look at selling our non-core investments at appropriate time,” Sardana said.