Coal India Units Get Cabinet Nod For Equity Investment In Thermal Power Plants

The Cabinet Committee on Economic Affairs approved on Thursday proposals for equity investment by Coal India Ltd. subsidiaries for setting up two thermal power plants.

South Eastern Coalfields Ltd.'s proposal is for the 660-megawatt thermal power plant through a joint venture with Madhya Pradesh Power Generation Co. at Amarkantak thermal power station in Anuppur district, according to an official release.

The second proposal is by Mahanadi Coalfields Ltd. for a 2x800 MW thermal power plant through subsidiary Mahanadi Basin Power Ltd. in Odisha's Sundargarh district.

The cabinet, chaired by the Prime Minister Narendra Modi, also gave approval to Coal India to carry out equity investments beyond 30% of its net worth—in SECL's joint venture involving an equity capital of Rs 823 crore and in MBPL with an equity capital of Rs 4,784 crore.

The MCL project has an estimated project capital expenditure of Rs 15,947 crore. The Madhya Pradesh project will have SECL exploring a debt-equity ratio of 70:30 and 49% equity investment in the joint venture with an estimated project capex of Rs 5,600 crore, it said.

Shares of CIL were trading 0.96% lower at Rs 376 apiece on the NSE compared to a 0.6% decline in the benchmark Nifty 50 at 2.10 p.m.