Lanco Infratech ties up $2 billion loans from Chinese banks

Tags: News
Infrastructure company, Lanco would raise a debt of $2 billion from the China Development Bank for two of it’s power projects — Anpara phase II and Himawat.

The company on Monday said they have signed a memorandum of Understanding with the government-backed bank. Of the total amount, the Chinese Development Bank will contribute $600 million and the bank will syndicate the rest from other Chinese banks and financial institutions.

“For the past couple of quarters, we have been working on strategies to address the liquidity concerns due to delay in receivables from utilities. The transaction comes at a time when many are saying that market conditions are quite unfavorable and sentiments are impacted. We are also working closely with utilities so that receivables can come through, which is likely in the coming days,” said L Madhusudhan Rao, chairman, Lanco Infratech, adding that the company is in the process of addressing the debt equity ratio as well.

The two power plants have a capacity of 1,320 megawatt each, with supercritical boiler technology. It is estimated that each project may have a total cost of around $1.25 billion, of which 20-30 per cent would be raised through equity.

“It will take a year’s time for the project to get on stream. We may raise the equity through internal or external sources, but this component may even go higher,” said Sharad Jhingan, chief operating officer, Lanco Infratech.

Lanco now has an operating capacity of 4740 MW and 4636 MW in different stages of execution, across coal, gas, hydro, solar and wind projects. It has also set a target of having 13,000 MW of capacity in the coming two years.

So far, CDB has sanctioned over $7 billion to Indian corporations and has an outstanding amount of over $4.3 billion. The bank is also said to have sanctioned $200 million buyer’s credit to Lanco for Amarkantak 3 & 4, Babandh and Vidarbha power projects being developed by the company. The company has an EPC order book of Rs 28,500 crore.

EDITORIAL OF THE DAY

  • Insurance regulator must ban differential pricing and exemptions on health covers

    To reduce their overall losses, non-life insurance companies have been increasing the health insurance premium they charge retail customers, both at t

FC NEWSLETTER

Stay informed on our latest news!

TODAY'S COLUMNS

Arun Kumar Jain

Reframe mindset to achieve excellence

Niels Bohr, the famous quantum physicist on­ce said, “The opposite ...

Kuruvilla Pandikattu

More real than the reality

Virtual reality (VR), a te­chnology that offers an un­imaginably altered ...

Dharmendra Khandal

Urbanisation is costing us our wildlife

The road transport and highways minister Nitin Gadkari aims to ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture