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Reliance Energy upbeat on EPC business

NEW DELHI: With Rs. 7,000-crore worth engineering, procurement and construction (EPC) contracts of the power sector in its kitty, Anil Ambani owned Reliance Energy Limited (REL) is upbeat on getting a major chunk of the Rs. 60,000-crore of business in the next five years, hoping to end fiscal 2008 with Rs. 15,000-crore order book.

According to company sources, REL has EPC contracts worth Rs. 7,000 crore in hand. The company is planning to bid for 7,000-8,000 MW projects in the EPC division and is also looking at bidding for Rs. 15,000-20,000-crore worth of projects. The company has already bagged two major transmission projects — Kol Dam and Parbati Valley in Himachal Pradesh and the western region transmission system project — worth Rs. 2,750 crore. It is also looking at some other transmission projects that can take its business in this segment to Rs. 10,000 crore.

A company official said REL was closely looking at ultra mega transmission projects. It had already put an Expression of Interest for four projects and was looking forward to ten more projects that were in the pipeline. The EPC division’s revenue was Rs. 2,082 crore in the last fiscal, almost a third of REL’s total revenue of Rs. 6,575 crore. About 8 per cent of the net profit of Rs. 801 crore of REL had been contributed by the EPC division.

REL is planning to add 14,960 MW in the next five years, for which the total investment will be Rs. 60,000 crore. Out of this, over 30 per cent is required for EPC activities. REL’s proposed projects include a 4,000-MW Ultra Mega Power Project (UMPP) at Sasan in Madhya Pradesh and Krishnapatnam in Andhra Pradesh, a 4,000-MW station at Shahapur in Maharashtra’s Raigad district, a 7,480-MW project at Dadri in Uttar Pradesh and a 300-MW captive power plant at Nagpur. The EPC activities of these projects will be channelled to the newly-floated company.

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