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(Reuters) - Indian infrastructure firms are circling coal assets overseas to fire up planned power plants in India as they look to benefit from the energy-hungry nation's aim to halve its near 14 percent power deficit within two years.
Companies in the sector such as Hindustan Construction Co (HCC) (HCNS.BO) are also looking at acquisitions in other sectors such as transmission towers or oil and gas pipelines to take on larger infrastructure projects in the fast-growing Indian market.
HCC is exploring acquisitions in Europe, the Middle East and South East Asia, the firm's chief financial officer told the Reuters Indian Investment Summit on Tuesday.
GVK Power and Infrastructure (GVKP.BO) and Lanco Infratech (LAIN.BO) are scouting for coal assets in Indonesia, Australia and Africa, top executives from the companies said at the summit.
"We are scouting around for (coal) assets. It's on the top of our mind," GVK Vice Chairman G.V. Sanjay Reddy said at the summit. "We are looking for as much coal as we can get.
India's power shortages, clogged and potholed roads and creaking railway network are seen as a significant brake on growth in Asia's third-largest economy, which aims to invest $1.5 trillion from 2007-17 to overhaul its infrastructure.
India aims to cut its power deficit to 6.5 percent in the fiscal year ending March 2012 from the current 13.8 percent, the head of the Central Electricity Authority told Reuters.
To achieve that target, more power plants need to be built to boost capacity in the country, but getting sources of energy such as coal to fuel the plants is a hurdle.
"The slow development of the coal sector and concerns being raised by the Ministry of Environment, by declaring that large chunks of coal mines as no-go area, this is a very serious matter," Gurdial Singh, the head of the Central Electricity Authority, told Reuters at the summit.
With renewable energy and natural gas resources limited, and coal assets underdeveloped in India, companies are increasingly looking to buy overseas assets to fuel their ambitious plans.
"We foresee in the near future, affordable power is the answer. We feel there is a huge opportunity to grow in terms of size," K. Raja Gopal, chief executive of Lanco's thermal power business, told Reuters.
OPPORTUNITY IN ROADS
Foreign investors are likely to fund up to 30 percent of India's $18 billion road projects in the current fiscal year, a top official at the National Highways Authority of India (NHAI) told Reuters at the summit. But Indian firms are players too. HCC wants to expand its presence in the building of toll roads, a relatively new concept in India, as the Indian government is expected to accept bids for around 6,000 kilometers of highway projects by March next year.
HCC will bid for at least three to four national highway projects over the next six months, worth between $1.5 billion to $2 billion each, Group Chief Financial Officer Praveen Sood told Reuters at the summit. He expected to bag two of the projects.
The firm, founded in 1926, has constructed nearly 2,300 kilometers of roads in India, including high profile projects such as the Mumbai-Pune expressway and the Bandra-Worli Sea Link in Mumbai.
GVK and Lanco are also looking at fresh opportunities in toll roads, lured by the potential for large orders. All firms said that auctions for road projects in India were very competitive.
(Reuters) - Indian infrastructure firms are circling coal assets overseas to fire up planned power plants in India as they look to benefit from the energy-hungry nation's aim to halve its near 14 percent power deficit within two years.
Companies in the sector such as Hindustan Construction Co (HCC) (HCNS.BO) are also looking at acquisitions in other sectors such as transmission towers or oil and gas pipelines to take on larger infrastructure projects in the fast-growing Indian market.
HCC is exploring acquisitions in Europe, the Middle East and South East Asia, the firm's chief financial officer told the Reuters Indian Investment Summit on Tuesday.
GVK Power and Infrastructure (GVKP.BO) and Lanco Infratech (LAIN.BO) are scouting for coal assets in Indonesia, Australia and Africa, top executives from the companies said at the summit.
"We are scouting around for (coal) assets. It's on the top of our mind," GVK Vice Chairman G.V. Sanjay Reddy said at the summit. "We are looking for as much coal as we can get.
India's power shortages, clogged and potholed roads and creaking railway network are seen as a significant brake on growth in Asia's third-largest economy, which aims to invest $1.5 trillion from 2007-17 to overhaul its infrastructure.
India aims to cut its power deficit to 6.5 percent in the fiscal year ending March 2012 from the current 13.8 percent, the head of the Central Electricity Authority told Reuters.
To achieve that target, more power plants need to be built to boost capacity in the country, but getting sources of energy such as coal to fuel the plants is a hurdle.
"The slow development of the coal sector and concerns being raised by the Ministry of Environment, by declaring that large chunks of coal mines as no-go area, this is a very serious matter," Gurdial Singh, the head of the Central Electricity Authority, told Reuters at the summit.
With renewable energy and natural gas resources limited, and coal assets underdeveloped in India, companies are increasingly looking to buy overseas assets to fuel their ambitious plans.
"We foresee in the near future, affordable power is the answer. We feel there is a huge opportunity to grow in terms of size," K. Raja Gopal, chief executive of Lanco's thermal power business, told Reuters.
OPPORTUNITY IN ROADS
Foreign investors are likely to fund up to 30 percent of India's $18 billion road projects in the current fiscal year, a top official at the National Highways Authority of India (NHAI) told Reuters at the summit. But Indian firms are players too. HCC wants to expand its presence in the building of toll roads, a relatively new concept in India, as the Indian government is expected to accept bids for around 6,000 kilometers of highway projects by March next year.
HCC will bid for at least three to four national highway projects over the next six months, worth between $1.5 billion to $2 billion each, Group Chief Financial Officer Praveen Sood told Reuters at the summit. He expected to bag two of the projects.
The firm, founded in 1926, has constructed nearly 2,300 kilometers of roads in India, including high profile projects such as the Mumbai-Pune expressway and the Bandra-Worli Sea Link in Mumbai.
GVK and Lanco are also looking at fresh opportunities in toll roads, lured by the potential for large orders. All firms said that auctions for road projects in India were very competitive.
(Reuters) - Indian infrastructure firms are circling coal assets overseas to fire up planned power plants in India as they look to benefit from the energy-hungry nation's aim to halve its near 14 percent power deficit within two years.
