Jaiprakash Power Ventures Share price and Fundamental Analysis

Company History

Jaiprakash Hydro-Power Limited (JHPL), a part of the Jaypee Group owns and operates the 300 MW Baspa-II Hydroelectric Project at District Kinnaur in Himachal Pradesh. The erstwhile Jaiprakash Industries Limited (JIL), the promoter company, since merged with Jaypee Cement Limited (JCL) and now known as Jaiprakash Associates Limited (JAL) signed the Memorandum of Understanding (MOU) with Government of Himachal Pradesh (GoHP) for Baspa Stage-II project in November of the year 1991 and was granted approval to develop 300 MW Baspa Stage-II Hydroelectric project in private sector on 'Build, Own and Operate' basis by the Government of Himachal Pradesh in October of the year 1992. Hence, the Company was incorporated in 21st December, 1994 with the object to set up hydroelectric or Thermal power projects and for the supply of general electric power. The Certificate of Commencement of Business was granted in 9th January of the year 1995.

Financial Institutions approved the Project at an estimated project cost of Rs.11, 020 million in March of the year 1995 and signed PPA as one of the pre-disbursement conditions. Executed the tripartite agreement between JHPL, JAL and GoHP in the same year 1995 consenting the transfer of all assets, liabilities, obligations, privileges and benefits arising out of MOU from JAL to JHPL. During June of the year 1997, the company signed PPA with HPSEB pursuant to Implementation Agreement with GoHP. In the same year, the financial institutions reappraised the project with a revised cost of Rs.12, 630 million. In January of the year 2008, JHPL made an amendment in the PPA to include provisions for escrow mechanism and letter of credit for realisation of payment from HPSEB. Accomplished the agreement with Siemens AG Consortium, Germany and Alstom T & D, France in the year 1999 for import of electromechanical equipment and GIS/GIB respectively. Again the financial institutions reappraised project cost at Rs.13, 450 million in the year 2000 and Rs. 16,120 million in the year 2002.

The Baspa-II project - India's Largest Private Sector Hydro-Power project has been fully commissioned in 8th June of the year 2003 at a project cost of Rs 1624.72 crores and has started generating power. Jaiprakash hydropower filed prospectus with ROC, all decks cleared for IPO in power sector in third week of March 2005. During the year 2005-2006, the company entered into a memorandum of Understanding with the Power Grid Corporation of India Ltd to promote a Joint Venture Company for establishing a Transmission System for evacuating power from 1000 KW Karcham Wangtoo Hydro-Electric Project. To minimize the erosion due to silt (with large quartz content) during monsoons, two more modern technology spare runners with Tungsten Carbide coating employing HVOF thermal spray have been procured/ ordered. One such runner was put in operation in May of the year 2006. JHPL filed the tariff application in 30th November of the year 2007 with Hon'ble HPERC for determination of tariff for Financial Year 2008-09 to 2010-11, which is in process.

In 2009-10, the Scheme of Amalgamation of erstwhile Jaiprakash Power Ventures Limited (JPVL) with Company (formerly known as Jaiprakash Hydro-Power Limited) with effect from 1st April, 2009 (appointed date) was sanctioned by Hon'ble High Court of Himachal Pradesh at Shimla on 20th November, 2009. Further, in terms of the said Scheme of Amalgamation, name of the Company was changed from Jaiprakash Hydro-Power Limited to Jaiprakash Power Ventures Limited with effect from 23rd December, 2009.

The Scheme of Amalgamation of Jaypee Karcham Hydro Corporation Limited (JKHCL) and Bina Power Supply Company Limited (BPSCL) with the Company was sanctioned by Hon'ble High Court of Himachal Pradesh at Shimla on 14th June, 2011 with the appointed date, 1st April, 2010. The Scheme of Amalgamation came into effect from the date of filing of the said Order with the Registrar of Companies, Punjab, Himachal Pradesh and Chandigarh on 26th July, 2011 and consequently, 1000 MW Jaypee Karcham Wangtoo Hydro-Electric Power Plant being implemented by erstwhile JKHCL and 1250 MW Jaypee Bina Thermal Power Plant (500 MW being implemented in Phase-I) by erstwhile BPSCL stood merged with Company. Out of the 1000 MW (4 x 250 MW) capacity of Jaypee Karcham Wangtoo Hydro Electric Plant, first unit of 250 MW was commissioned on 26th May, 2011 and second unit of 250 MW was commissioned on 23rd June, 2011.

The Board in its meeting held on 1st March, 2014 sanctioned a Scheme of Arrangement for hiving off 300 MW Baspa-II HEP and 1091 MW Karcham Wangtoo HEP to two separate wholly owned subsidiaries and eventual transfer of ownership of the said wholly owned subsidiaries to a consortium led by TAQA India Power Ventures Private Limited (TAQA). With withdrawal of TAQA, the Acquisition Agreement dated 1st March, 2014 automatically stands terminated.

2 MTPA Jaypee Nigrie Cement Grinding Unit at Singrauli in Madhya Pradesh, started commercial operations w.e.f. 3rd June, 2015. In 2015, the assets, liabilities, rights, interest, privileges, etc. of 300 MW Jaypee Baspa-II Hydro - electric Plant and 1091 MW Jaypee Karcham Wangtoo Hydro - electric Plant were transferred and vested with the then Company's subsidiary, Himachal Baspa Power Company Limited (HBPCL) upon the Scheme of Arrangement sanctioned by the Hon'ble High Court of Himachal Pradesh dated 25th June, 2015, becoming effective w.e.f. 1st September, 2015. Thereafter, the entire securities i.e., Equity Shares & Non Convertible Debentures issued by HBPCL to the Company in terms of Scheme of Arrangement, were transferred & sold to JSW Energy Limited dated November 16th, 2014 at an enterprise value of Rs. 9,700 crore.

In 2018, the Company had implemented 1980 MW Bara Thermal Power Plant of which, all the three units of 660 MW each are operational through its erstwhile subsidiary i.e. Prayagraj Power Generation Company Limited (PPGCL), which ceased to be subsidiary of the Company, consequent upon invocation of entire pledged shares held by the Company in PPGCL, by SBICAP Trustee Company Limited on behalf of banks/ financial institutions on 18th December, 2017.

Consequent upon holding of 51% shares by conversion of loan into equity under Strategic Debt Restructuring Scheme and holding of 49.85% shares by Banks and Financial Institutions, Jaiprakash Associates Limited (JAL), the Promoter of the company, ceased to be holding Company of the Company w.e.f. 18th February, 2017. However, since 29.74 % shares of the company are held by JAL as such, the Company is an Associate Company of JAL.

The Jaypee Powergrid Ltd. (JPL) was a Joint Venture Company between the Company and Power Grid Corporation of India Limited (PGCIL) in which, 74% capital was held by the Company. As approved by the Board on 2nd March, 2021, the entire 74% stake of JPL was sold to PGCIL at a consideration of Rs. 35,450 lakhs and consequently, JPL ceased to be subsidiary of JPVL w.e.f. 25th March 2021.