Power Finance Corporation Ltd has recorded a robust loan asset growth of 14% this year with its’ highest-ever disbursement of Rs 64,400 crores and highest-ever sanctions of Rs 1,16,000 crores in FY 2017-18, according to Rajeev Sharma, CMD, (PFCL).

Highlighting PFCL’s achievements during FY 2017-18 here today, Sharma told mediapersons that disbursements witnessed a significant jump in the area of Renewables and Refinancing. The Renewables business saw 260% growth (from Rs 2,500 crores to Rs 9,000 crores) including 5 Wind projects of IL&FS (Rs 2,500 crores), ACME 3 Solar projects (Rs 950 crores) and Mytra Wind (Rs 750 crores), he said.

PFCL’s Refinancing business had 100% growth from Rs 6,900 crores to Rs 30,750 crores, of which significant deals were: NTPC Meja (Rs 1,700 crores – Replaced 16 Banks) and Raichur Yermarus TPS (Rs 1,700 crore—Replaced 7 Banks).

The company’s new areas of funding included: First time venture into Irrigation schemes (funding Electro & Hydro mechanical components of irrigation schemes in Telengana through sanctioning Rs 12,000 crores and disbursements of Rs 2,000 crores –backed by State Government Guarantee); and First waste-to-energy Project with sanctioning and disbursement of Rs 290 crores to Ramky Group, besides also sanctioning 15 MW WTE project in Ahmedabad (Good Watts Energy).

Sharma said PFCL is exploring diversification of its loan portfolio including funding for Electro & Hydro mechanical components related to Lift Irrigation/Sewage treatment plants/Smart Cities, Gas/LNG/Coal Mining, Railway Electrification, E-Vehicle manufacturing Units (including Charging Stations), Battery manufacturing Units for Solar Projects, Mini/Metro Grids for distributed generation, Energy Efficiency Systems like Cogeneration/Trigeneration/Combined heat & power, waste recovery systems.

In PFCL’s diversification in Borrowings & Efforts undertaken for reduction in cost of funds, it had mobilized Rs 78,000 crores during FY 2017/18 and raised highest-ever foreign currency loans of US$ 1.7 billion in a year, which included; First-time tapped Green Bonds of US$ 400 million; besides raising US$ 800 million syndicated loans in a year; and raising FCNR B loans of US$ 460 million.

PFCL highlighted highest-ever refinancing of existing ECBs of US$ 1.1 billion to reduce cost and which included: US$ 450 million already done (Savings of Rs 60-70 crores); US$ 250 million already done (effective June 2018 – savings of Rs 17 crores); and US$ 400 million underway for refinancing.

Sharma said that PFCL’s total Loan Assets stood at Rs 2.79 lakh crores, including Government-owned projects (82% at Rs 2.28 lakh crores) and Private (18% at Rs 51,000 crores that included — Rs 20,000 crores (7%. No STRESS) and Rs 31,000 crores (11% — STRESSED). “However, 89% of our total Asset Book is not having any kind of stress,” he said while noting that out of the Stressed Projects, 55% are commissioned (10 GW out of stressed capacity of 18.4GW), and ~ 50% have coal linkage/FSA.

“Four projects are in advanced stage of resolution amounting to Rs 4,300 crores where we don’t expect a major haircut. The DANs & Shiga projects in Sikkim signed PPAs and should be out of stress; GVK Ratle has agreed for a one-time settlement; and South East — talks are in advanced stage with UP for a takeover,” he said.

Four projects are under bidding for change of management (i.e. Rs 6,300 crores). The market response is good as the participating players are reputed. GMR Chhatisgarh –5 bidders submitted Non-Binding offers (NLC, Adani, Vedanta, Torrent and JSW); KSK Mahanadi – 15 EoIs received, 13 qualified and RFP to be issued shortly – with qualified bidders being: Adani, Hinduja, JSW, Resurgent, Torrent, Edelweiss, India Resurgence, L&T, SSG Capital (Singapore), Vedanta, Lone Star Fund, Merrill Lynch, NIIF; Jhabua Power – 18 EoIs received, finalizing evaluation criteria to float RFP (Adani, Bank of America Merrill Lynch, Bhilwara Energy, Edelweiss, Hindustan Thermal Power, JM Financial, Ind RF, JSW, KKR (Fund), Lonestar – IL&FS, Resurgence Power, SC Lowy, Torrent, Vedanta, Varde Partners, SSG Asia, World Window EXIM, NIIF); and Essar Mahan – EoIs to be floated shortly.

Sharma said that 9 projects of Rs 8,100 crores are being resolved through the NCLT route. Talks are on with the Maharashtra Government for the Rs 3,000 crore Rattan India project at Nasik, while a Resolution Plan is under finalization for 6 projects (estimated at Rs 8,700 crores) including RKM Powergen (under restructuring, terms to be finalized in June 2018), Rattan Amravati (under restructuring), and Resolution Plan underway for Essar Transmission, India Power Haldia, RS India and Astonfield.

About Reversals likely in 2018-19, he said the Government Sector would witness: Rs 4,600 crores in Government NPAs getting an upgrade (Reversal of Rs 230 crores); and Rs 12,000 crores of Government Restructured Assets being upgraded (Reversal of Rs 600 crores.)

Replying to questions, Sharma said “We are financing private power projects — due to our robust mechanism of appraisal – of Rs 2500 crores (Three solar projects of Rs 950 crores and another of Rs 750 crores). We are also financing efficient projects– where we look at the vitality, viability and capacity of the developer first — and are even into coal mining development if it is for power.”