The Sinnar Thermal Power Plant, currently owned by RattanIndia Power, was initially developed by Indiabulls Power. It was admitted by the National Company Law Tribunal (NCLT) for corporate insolvency in September 2022 and entered insolvency in January after a plea by Shapoorji Pallonji & Co over unpaid dues related to plant construction.
“Six resolution plans were received earlier this month and are still being evaluated for compliance under the bankruptcy code. The value of these bids is yet to be ascertained as there could be some to and fro between the resolution professional and creditors,” said a source. All bidders have submitted initial plans, including a Rs 10 crore deposit as part of their proposals.
The plant’s major creditors include Power Finance Corp, owed Rs 6,553 crore, and its subsidiary, Rural Electrification Corp, owed Rs 5,262 crore. The total dues stand at Rs 15,909 crore, with other creditors such as Punjab National Bank, Axis Bank, Canara Bank, Bank of India, and Life Insurance Corp. The plant, situated in the Sinnar special economic zone (SEZ), is located approximately 50 km from Nashik and 4 km from a national highway.
With 1,600 acres of land surrounding the defunct plant, the new owner could potentially double the capacity by adding another 1,350 MW. However, unresolved land disputes, coal supply issues, and the lack of a power purchase agreement (PPA) may complicate the valuation for creditors. “There are right-of-way issues and also no railway linkage to the plant. Building a 150 to 200 km rail line will cost hundreds of crores and will have to be factored in by any prospective buyer,” another source told The Economic Times.
Only one 270 MW unit has achieved commercial operations, with the remaining units operating intermittently. The joint bid by MAHAGENCO and NTPC could be a strong contender due to their ability to leverage existing infrastructure, particularly MAHAGENCO’s 2,190 MW Koradi power plant near Nagpur, which could serve as a coal supplier to the Sinnar plant. MAHAGENCO, with over 13,000 MW of installed capacity, is the largest state government-owned power producer in India.
The plant’s coal supply has been a major issue since December 2022, when South Eastern Coalfields Ltd cancelled its coal contract, citing the lack of a PPA and the partial commissioning of the plant. The plant’s previous PPA with Maharashtra State Electricity Distribution Company (MSEDC) was also terminated several years ago, adding further complexity to the bidding process.
First Published: Oct 16 2024 | 10:54 AM IST
