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Dabhol debt recovery process in motion
New Delhi: With the Gail India board clearing a Rs500-crore investment in Ratnagiri Gas and Power Pvt Ltd (RGPPL), a special purpose vehicle set up to revive the plant, the debt recovery process in the Dabhol power plant is now in motion. The National Thermal Power Corporation (NTPC) board had earlier cleared the investment in the SPV.

The plant , will first be transferred to New Age Power Company Pvt. Ltd, an SPV floated by GE and Bechtel, and then to Ratnagiri Gas and Power Pvt. Ltd. Once the asset transfer is complete, RGPPL will undertake construction and commissioning activities of the power plant.

Meanwhile global investment banker Rothschild has valued the assets of the defunct Dabhol power venture at Rs10,038 crore. While the asset valuation of the 2,184MW Dabhol power plant is roughly Rs7,538 crore, the combined assets of the LNG terminal and re-gasification facilities is pegged at Rs2,500 crore.

Rothschild is financial advisor to the IDBI-led lenders with whom the Dabhol assets are mortgaged.

Ratnagiri Gas & Power (RGPPL), the SPV that will take over Dabhol assets from the local lenders will be a three-way equity partnership with NTPC, Gail and domestic FIs holding 33.33% each in the SPV.

The lenders will sell the Dabhol assets to RGPPL by invoking their mortgage rights. They propose to recover the entire Rs10,038 crore from RGPPL through the debt-recovery tribunal (DRT) and legal process involving the Mumbai HC.

RGPPL's promoters will make a total cash payment of Rs1,500 crore to the IDBI-led lenders in proportion to their respective holdings in the SPV. The balance Rs8,538 crore will be converted into a loan for RGPPL by IDBI-led lenders, NTPC officials said.
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GAIL projects possibility of hike in per unit tariff from Dabhol plant
Mumbai: GAIL India has projected every possibility of a hike in the per-unit tariff from the Dabhol plant to Rs2.60-2.75 from the already agreed upon price of Rs2.30. The projection arises from the fact that LNG prices have now shot up to $6-7 million British thermal unit (MBTU).

GAIL sources have said that though all efforts were on to close a deal for a long-term period, so that the per unit tariff of Rs2.30 was maintained, the possibility of marginal variation in view of increased LNG prices in the world market could not be ruled out.

The LNG issue came up for discussion at the review meeting chaired by power secretary RV Shahi on July 22.

Meanwhile, a team comprising National Thermal Power Corporation (NTPC) and GAIL India would carry out a due diligence at the plant site in next two days. According sources, NTPC, GAIL India and Maharashtra Power Development Corporation Ltd (MPDCL) during this week would finalise the terms with lenders on filing consent petition in the Bombay High Court.

Subsequently, they would later approach the Debt Recovery Tribunal within 10 days for acquiring the Dabhol assets.
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Tata Motors working on prototypes for hybrid cars
New Delhi: Tata Motors plans to have its concept prototypes ready for hybrid cars and hybrid buses over the next six months. The company is also working on a fuel cell bus, the prototype of which would be ready over the next one-and-a-half to two years.

Tata Motors officials have indicated that they are in talks with various electric vehicle motor manufacturing companies to have them set up shop in India so that motors for electric vehicles could be available at lower costs. This in turn would drive down the manufacturing costs.

"We are working on the prototypes for hybrid cars (Indica and Indigo) and buses. They are expected to be ready over the next six months," Tata Motors General Manager (Electricals & Electronics), V.G. Gujrathi, has said. He was addressing a workshop on `Technology Priorities for Electric Vehicles' organised by the Technology Information, Forecasting and Assessment Council (TIFAC).

Pointing out that there is a need to bring down the cost of electric motors to encourage usage of electric vehicles, he said, "Importing the motors of electric vehicles escalates the cost to a major extent making it impossible to be an economically feasible option for Indian consumers. We are in talks with some companies and asking them to set shop in India."

Apart from bringing down the motor prices, improving battery technology and making easy finance schemes available for electric cars are other issues to be taken care of, pointed out experts.
He also stressed on the need to have battery-charging centres in place.

Senior official from Scooters India, H.S. Sikka, also called for easy financing schemes for purchasing electric vehicles, for batteries and for putting charging infrastructure in place if the country has to encourage electric vehicles. Over 700 electric vehicles (three wheelers) developed by Scooters India are plying in various cities including Agra, Delhi, Lucknow and Pune, he added.

TIFAC Executive Director Prof Anand Patwardhan said that TIFAC would bring out a report that would list out the kind of intervention required to promote electric vehicles.
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REL asked to hike equity in Dadri project
New Delhi: Financial institutions backing Reliance Energy Ltd's 3,740-megawatt (MW) Dadri power project have asked the promoters to raise the equity component to 30 per cent of the project cost, instead of the 10 per cent equity investment proposed by the company.

According to institutional sources, the consortium of lenders comprising ICICI, IDBI, SBI and Punjab Financial Corporation has asked Reliance Energy Generation, the special purpose vehicle floated by Reliance Energy for executing the project, to up its equity contribution to the 30 per cent normative project cost level suggested by the Central Electricity Regulatory Commission (CERC) for the funding of generation stations.

The 3,740-MW gas-fired project is the first stage of what is expected to be the world's biggest gas-based power project (with a capacity of 7,480 MW) proposed to be executed by Reliance Energy Generation at Dadri, Ghaziabad. The estimated cost of the first stage alone is around Rs11,000 crore. According to sources, if the project is executed on the proposed 90:10 debt-equity ratio, the consortium of lenders would have to chip in with loans of as much as Rs9,900 crore.

The sources, however, said that once the finance issue is sorted out, the project would be on course for financial closure, with the SPV having already received environmental clearance for the entire project and several States, besides Uttar Pradesh, evincing interest in drawing electricity from it.
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JVS Exports chalks out Rs.80 crore expansion plan
Chennai: JVS Exports, which recently won the 'International supplier of the year 2004' award from Wal-Mart, being chosen from among 45,000 suppliers worldwide, has set out a Rs80-crore expansion plan which will be executed over the next three to four years.

The company is now in the process of acquiring 50 acres near Madurai for the purpose. This follows a recent announcement by Wal-Mart that it would increase outsourced textiles manufacture by 30 per cent.

For 2004-05, JVS did business worth about $12.5 million with Wal-Mart, roughly half its current turnover of Rs105 crore. With the expansion, JVS is eyeing revenues of Rs500 crore by 2009.

JVS Exports officials said that the investment would be in three phases. The first phase would see Rs20 crore invested in creating extra capacity for the company's kitchen and dining textiles unit. This would eliminate the need for sub-contract jobs when demand spurts.

The second phase, to become functional by April 2006, would require a similar investment. The company plans to begin manufacture of terry towels at that point. The third phase, with an investment of Rs40 crore, would see the company expand into bathroom and bedroom textiles, which would start in April 2007.

According to company officials half of the funds necessary for the first two phases would come through debt and the other half from internal accruals.

For the first phase, the company has tied up with Central Bank of India for the debt portion. In the course of the expansion, JVS would double its number of automatic looms to 66 with the new plant. JVS is also looking at backward integration. That is, it currently outsources dyeing of spun cotton. At the new facility, it plans to do its own dyeing.

JVS' client list includes Canada-based Sears, the UK's Primark Stores and South Africa's retailer Pep Stores.
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Tata Indicom completes first phase of USO commitment in Karnataka
Bangalore: Tata Indicom has completed the first phase of its Universal Service Obligation (USO) commitment in Karnataka by installing 325 fixed wireless terminals (FWTs) in 15 villages and towns.

Tata Indicom won the bid in 42 short supply areas (SSAs), out of which 31 SSAs are in northern circles, five in Maharashtra, and two each in Karnataka, Bihar and Madhya Pradesh. Under the USO, Tata Teleservices Ltd (TTSL) will cover 215 short distance charging areas (SDCAs) in the SSAs.

TTSL proposes to invest over Rs215 crore to fulfil its USO obligation. The company envisages a substantial growth in demand for its FWTs in rural areas. The FWTs are user-friendly and easy to install. The instrument comes with a visual-based manual for semi-literate users and is backed by customer care.

In addition, TTSL will be completing its USO obligation in the Punjab and Bihar circles.

The purpose of the USO fund is to increase the teledensity in India by penetrating into remote rural areas. It is an incentive for operators to fund their wireless or wire-line telephony operations in rural areas with a population of less than 5,000 people.

Currently, the penetration in 5,000 villages in India is less than one per cent. With over 60 per cent of the population living in villages, the nationwide telecom demand is huge.
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Continental Airlines' direct US-India flights from November
New Delhi: US carrier Continental Airlines is set to start its daily non-stop service between New Jersey and New Delhi from November.

"Continental's Delhi-Newark service is being launched Nov 2, 2005. The first eastbound flight will depart Newark's Liberty International Airport Nov 1," a spokesman for the US carrier said. Fares begin from $499 each way.

"The airline will fly Boeing-777 aircraft with 48 seats in the business and first class cabin and 235 seats in the economy class," a spokesman for the airline said.

The airline official said this would be Continental's longest flight after the service to Hong Kong. "The flying time will be approximately 15 hours and 50 minutes for westbound, and 13 hours and 55 minutes eastbound," he said.

"Our non-stop service will offer average travel time savings between New Delhi and New York of at least two hours westbound and two-and-a-half hours eastbound, as well as cutting journey time to and from numerous other US cities."

The official said an added advantage of flying Continental will be quick and easy onward connections to cities throughout the Americas from the same airline as well as the same terminal.

Connections will be available to Continental's 427 daily services from Liberty International Airport to 170 destinations in the Americas, including 153 that are served with non-stop flights, airline officials added.
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