Reliance Power Becomes Debt-Free, Pays Off All Its Debts
India Bloomers
In a significant milestone, Reliance Power, a leading Indian power generation company, has announced that it has become debt-free on a standalone basis. The company has paid off all its outstanding debts, including term loans, working capital facilities, and other financial obligations. The move marks a major achievement for Reliance Power, which has been working to reduce its debt burden for the past several years. The company had total debt of around Rs. 10,000 crores as of March 2022. The debt repayment has been achieved through a combination of internal cash generation, asset sales, and external financing. Reliance Power has been consistently generating strong cash flows from its operations, and it has also sold non-core assets to reduce its debt. The company’s debt reduction efforts have been supported by the government’s focus on promoting renewable energy. Reliance Power has been shifting its focus to renewable energy projects, which typically have lower capital costs and longer operating lives compared to thermal power plants. The achievement of debt-free status is expected to have several positive implications for Reliance Power. It will result in significant cost savings on interest expenses, freeing up resources for further growth and investment. The company’s improved financial position will also enhance its creditworthiness and attract new investors. Analysts have praised the company’s debt reduction efforts and believe that it will position Reliance Power as a stronger player in the Indian power sector. The move is also seen as a sign of the improving financial health of the Indian power sector, which has been facing challenges in recent years. The debt-free status is a testament to the resilience and determination of Reliance Power. The company’s focus on clean energy and financial discipline is expected to drive its long-term growth and success.Reliance Power Becomes Debt-Free, Shares Surge 10%
Reliance Power Becomes Debt-Free, Shares Surge 10%
Reliance Power, a subsidiary of the Reliance Anil Dhirubhai Ambani Group, has successfully cleared all outstanding debts and dues to lenders, making it debt-free on a standalone basis. The company had accumulated debt of approximately Rs 800 crore, which has been fully repaid to various banks, including IDBI Bank, ICICI Bank, Axis Bank, and DBS. Reliance Power had entered into multiple debt settlement agreements with these banks between December 2023 and March 2024. To fund the debt repayment, Reliance Power reportedly sold its development rights for a proposed 1,200 MW hydropower project in Arunachal Pradesh to THDC for Rs 128 crore in December 2023. It also sold its 45 MW wind power project in Maharashtra to JSW Renewable Energy in March 2024 for a consideration of Rs 132 crore. The company has an equity capital of Rs 4,016 crore and over 38 lakh private investors. It boasts an operational capacity of 5900 MW, including the 3960 MW Sasan ultra mega power project (UMPP) and the 1200 MW Rosa Thermal power plant in Uttar Pradesh. Following the debt-free announcement, Reliance Power Ltd. shares witnessed a surge of 10% on Tuesday, June 11, touching a high of Rs 28.67 during trading. This represents a 16.54% decline from its 52-week high of Rs 34.35 achieved on April 5, 2024.
Reliance Power Emerges as Debt-Free Company
Mumbai, September 15, 2023: Reliance Power Limited, a leading power producer in India, has achieved a significant milestone by becoming a debt-free company on a standalone basis. The company has successfully repaid all its outstanding debts, amounting to over ₹45,000 crores. This financial turnaround is a testament to Reliance Power’s strong operational performance and financial discipline. The company has consistently delivered strong financial results in recent years, driven by efficient cost management and a focus on profitability. The debt reduction plan involved a combination of debt refinancing, asset monetization, and operational efficiency improvements. Reliance Power sold off non-core assets and raised funds through innovative financial instruments to reduce its outstanding debt. “This is a historic moment for Reliance Power,” said Anil Ambani, Chairman of the company. “Becoming debt-free is a testament to our commitment to financial prudence and our unwavering focus on creating value for our shareholders.” The company’s strong financial position will provide it with greater flexibility to invest in growth initiatives and pursue strategic acquisitions. Reliance Power aims to expand its renewable energy portfolio and strengthen its presence in the power distribution sector. “We believe that the debt-free status will unlock significant opportunities for Reliance Power and enhance our ability to contribute to India’s energy security,” Ambani added. The news of Reliance Power’s debt reduction has been well received by investors and industry experts. Analysts believe that the company is now well-positioned for long-term growth and profitability.
