SJVN Limited , a joint venture between the Government of India and the Government of Himachal Pradesh, has achieved a significant milestone with the commencement of commercial operations of the 660 MW Unit-1 at its Buxar Thermal Power Project in Bihar. This development marks a crucial step in SJVN's efforts to bolster India's power generation capacity.

Project Details and Impact

The Buxar Thermal Power Project, with a total capacity of 1,320 MW (2x660 MW), is being implemented by SJVN Thermal Private Limited, a wholly-owned subsidiary of SJVN. The project, located at Chausa in Buxar district, Bihar, is equipped with state-of-the-art supercritical technology, ensuring higher efficiency and reduced environmental impact.

Key highlights of the project include:

• Annual Generation: The project is expected to generate 9,828.72 million units of electricity annually.
• Power Distribution: 85% of the generated power will be supplied to Bihar under a long-term Power Purchase Agreement.
• Tariff: The average tariff for the project is around INR 5.40 per unit.
• Environmental Considerations: The use of supercritical technology aims to minimize the project's environmental footprint.

Progress and Future Outlook

SJVN has reported significant progress on both units of the Buxar Thermal Power Project:

• Unit-1 (660 MW): Has successfully achieved commercial operation.
• Unit-2 (660 MW): Expected to commence commercial operations by January or February 2026.

The completion of this project is set to substantially enhance power availability in Bihar and the Eastern Region, addressing peak-hour shortages and strengthening energy security.

Financial Implications

The commissioning of the Buxar Thermal Power Project is expected to have a positive impact on SJVN's financial performance:

• Revenue Generation: With the commencement of commercial operations, the project will start contributing to SJVN's revenue stream.
• Debt Servicing: The company anticipates that the cash generated from the Buxar project will help in servicing its loans, maintaining a comfortable financial position.

SJVN's Growth Trajectory

SJVN is actively expanding its portfolio across various energy sectors:

• Operational Capacity: With the addition of the Buxar unit, SJVN's total installed capacity now stands at 3,146.52 MW.
• Renewable Energy: The company is set to commission around 650 MW of solar projects during the current financial year.
• Upcoming Projects: SJVN is preparing to start construction on two major hydroelectric projects in Nepal - the 680 MW Lower Arun and the 900 MW Upper Karnali projects.

Management's Perspective

Bhupender Gupta, Chairman and Managing Director of SJVN, expressed confidence in the company's growth trajectory, stating, "SJVN Limited is on very sound footing. We are focusing on completing our under-construction projects to start generating revenue. With our upcoming projects in Nepal and the commissioning of various renewable energy projects, we anticipate steady growth in revenue, profit, and capacity addition in the coming years."

As SJVN continues to expand its operational capacity and diversify its energy portfolio, the successful commissioning of the Buxar Thermal Power Project unit represents a significant step towards achieving its long-term growth objectives and contributing to India's energy security.

SJVN Limited , a joint venture between the Government of India and the Government of Himachal Pradesh, has announced a significant move to bolster its financial resources. The company's board of directors has approved a plan to raise up to ₹1,000 crores through the securitization of future income from its flagship Nathpa Jhakri Hydro Electric Project.

Fundraising Strategy

The fundraising initiative involves monetizing the expected future cash flows from the 1,500 MW Nathpa Jhakri Hydro Electric Project. This strategic decision aims to achieve the target set for the fiscal year 2025-26 under the National Monetization Pipeline, a government initiative to unlock value from public sector assets.

Project Significance

The Nathpa Jhakri Hydro Electric Project, SJVN's largest operational asset, has been a cornerstone of the company's power generation portfolio. By leveraging the future revenue streams of this project, SJVN is adopting an innovative financing approach to support its growth and expansion plans.

Financial Performance Context

The decision comes against the backdrop of SJVN's recent financial performance. As per the company's consolidated financial results for the quarter ended September 30:

While the company has maintained a steady revenue stream, the net profit has seen a decline compared to the same quarter in the previous year.

Regulatory Compliance

SJVN has emphasized its compliance with regulatory requirements. In line with SEBI Listing Regulations, the company has disclosed details of the utilization of issue proceeds and security cover for its existing Non-Convertible Debt Securities, demonstrating transparency in its financial operations.

Management Changes

Coinciding with this financial decision, SJVN has appointed Shri Sipan Kumar Garg as the new Chief Financial Officer. With over 23 years of experience in finance, accounts, taxation, and commercial aspects within the power sector, Garg's expertise is expected to play a crucial role in managing the company's financial strategies, including this securitization initiative.

Outlook

The securitization of future income from the Nathpa Jhakri project represents a forward-thinking approach to capital raising. It allows SJVN to access funds without increasing its debt burden in the traditional sense. This move may provide the company with the financial flexibility needed to pursue its expansion plans and meet its targets under the National Monetization Pipeline.

As SJVN continues to navigate the evolving energy landscape, this fundraising strategy could set a precedent for other public sector enterprises looking to optimize their asset utilization and financial structures.