New Delhi, Apr 15 (PTI) Mining conglomerate Vedanta Ltd has secured an 11-year term loan of Rs 3,918 crore from Power Finance Corporation Ltd (PFC), sources said.
The financial closure will enable Vedanta to expedite completion of its power projects.
The group plans to increase the operating capacity of its power business in India to 4.8 GW by FY27, sources with knowledge of the matter said.
The latest financing follows Vedanta group's takeover of Meenakshi Energy Ltd on December 28 in an NCLT-driven insolvency process.
Meenakshi Energy has a coal-based power plant at Nellore, Andhra Pradesh, which Vedanta will use to supply power to merchants.
Vedanta has acquired two plants -- Meenakshi Energy Ltd in Andhra Pradesh with a capacity of 1 GW, and Athena Power in Chhattisgarh with a capacity of 1.2 GW.
It will primarily use the funds for these two of its key power plants, they said.
The funding is part of the group's renewed focus on growing its energy portfolio in India and the financial closure will enable the company to expedite the completion of the power projects.
PFC is India's largest power-sector lender and typically extends financing to corporations that own promising power projects and manufacture power-sector equipment.
In August 2022, the London-headquartered mining giant acquired Athena Chhattisgarh Power Ltd for Rs 565 crore to meet its captive power requirements.
Athena Chhattisgarh has a 1.2 GW coal-based power plant at Janjgir Champa district.
Vedanta's power strategy is in focus amid the group's ongoing demerger. Marquee investors, including BlackRock, the world's largest asset manager, as well as the Abu Dhabi Investment Authority (ADIA) and domestic mutual funds like ICICI Mutual Fund, Nippon India Mutual Fund and Mirae Mutual Fund have all increased their holdings in company which is proof to its strong and stable financial position.
Vedanta has sharply increased focus on the energy generation business over the past two years.
Last month, Serentica Renewables, a renewable power company promoted by Sterlite Power, said it would invest Rs 25,000 crore to expand its projects portfolio to about 4 GW by June 2025.
Sterlite will first commission 600 MW of renewable energy projects and add 500 MW of capacity in each subsequent quarter.
In September, Serentica received Rs 2,600 crore from PFC for its hybrid renewable energy projects in Karnataka that is being built to meet captive energy needs of Vedanta group companies.
Athena's plant, built close to Mahanadi river, is about 80 km from BALCO and about 180 km from Jharsuguda, and is connected by national highways and railway stations.
The company recently announced the commissioning of a new 1.5 metric tonnes per annum expansion at its alumina refinery in Lanjigarh, Odisha.
This additional capacity will take the overall nameplate capacity at the Lanjigarh refinery from 2 mtpa to 5 mtpa.
Vedanta Sesa Goa also commenced mining operations at the Bicholim mineral block, adding to its growth plans.
In September, Vedanta announced the demerger of its metals, power, aluminium, and oil and gas businesses to unlock value.
The exercise will create six independent verticals -- Vedanta Aluminium, Vedanta Oil & Gas, Vedanta Power, Vedanta Steel and Ferrous Materials, Vedanta Base Metals and Vedanta Ltd.