Reliance Energy Eyeing Coal Mines

The next big focus for Anil Ambani''s group companies is Reliance Energy as it diversifies into engineering, construction and power.Reliance Energy is planning to increase its capacity to 20,000 MW over next five years. But one big constraint as it ramps up is the availability of fuel especially coal.

However, Reliance Energy is scouting for coalmines abroad. Its eyeing stakes in Australian, Indonesian and African coal mines and its also evaluating options to sign long-term contracts with coal miners.

Reliance Energy says that right pricing would be the key to any acquisition. However, it''s not shying away from any size of the acquisition target. It may consider raising funds via debt for coal mine acquisition.

The strategy behind acquiring mines is to ensure regular supply of coal and it''s targeting coal mines with high calorific value to maximize investment returns.

Reliance Energy stock has outperformed markets. It has gained 111 per cent in last one year and closed at an all time high on Thursday. Analysts say that more value could be unlocked if Reliance Energy demerges its engineering and construction business from power.