Bhel's NBFC plan delayed, board seeks changes: CMD
Cash-rich power equipment giant Bhel's plan to float a non-banking finance company has been delayed as the board of the PSU has asked consultancy firm Crisil to incorporate some changes before finalising the contours of the NBFC proposal.Updated: Jul 03, 2011 14:43 IST
Cash-rich power equipment giant Bhel's plan to float a non-banking finance company has been delayed as the board of the PSU has asked consultancy firm Crisil to incorporate some changes before finalising the contours of the NBFC proposal.
"Our consultant -- Crisil -- has worked out details and submitted the report to the board, which has asked them make some changes, the revised report would be considered by the board again in next 1-2 months," Bhel CMD BP Rao told PTI in an interview.
"Certain working changes were sought by the board," he said, but did not specify what changes the board has asked for.
Bhel, which is sitting on a cash surplus of Rs 9,000 crore, plans to foray into NBFC space to fund power projects. Creation of the NBFC would help Bhel to better utilise its cash surplus, especially in terms of financing infrastructure projects.
Bhel's operations are organised under three business verticals -- power, industry and overseas business. The industry segment includes transmission, transportation and renewable energy.
It has installed equipment with a total generation capacity of over 1,00,000 MW for utilities and captive and industrial users, according to the company website.
Asked whether this financing arm would compete with the likes of Power Finance Corp and Rural Electrification Corp, Rao said, "No. They (PFC, REC) have a big magnitude... our NBFC would be small."
Bhel, which has an orderbook position of Rs 1.64 lakh crore, is present in over 70 countries, spanning six continents, and has set a target of generating Rs 45,000 crore of revenue by the end of the current XI Five-Year Plan (2007-12).
NBFC operations would help Bhel in facilitating financial closure for power projects without much delay and in return, would get orders for equipment.