Tata Power To Enter Shipping Biz

Mumbai: Tata Power, the country''s largest private sector power company, mulls to enter into the shipping and logistics business in order to facilitate coal procurement for its power plants. The Tata group''s power arm also mulls to mop up Rs 4,000 crore from the international markets. Tata Power will mop up Rs 4,000 crore either via sale of equity via the GDR route or issue of foreign currency convertible bonds (FCCB).

The company will ask the shareholders clearance for getting into the logistic business through a postal ballot. An entry into the shipping business would help it decrease the cost of transporting coal from abroad. With coal becoming scarce in the country, power utilities will have to rely more on imported coal from countries like Indonesia, China and other south Asian countries. The company will quadruple its generation capacity from 2,400 mw in five years. The aimed capacity will not be attained without having a coal commitment from foreign countries. So, the entry into shipping business is actually a logical step forward.