Odisha to divest 49% stake in profit-making PSU

The Odisha government has started the process to sell its 49% ownership in the profitable PSU Odisha Power Generation Corporation (OPGC), which runs the 1,740 MW Banharpalli thermal power plant in the Jharsuguda district.

The action was taken just two years after the Odisha government opted to acquire back its 49% stake in OPGC from US-based AES Corporation Ltd.

The corporation, which purchased a 49% stake in OPGC in 1998, opted to sell its stake for $135 million in August 2020. The thermal power plant is currently 100% owned by the state government. The planned disinvestment in the PSU has been invited by the Odisha energy department, but no justification for the decision has been given. The department has also not made it clear how much money it will make after the disinvestment procedure.

The disinvestment will be carried out in two stages, with SBI Capital Markets Limited (SBICAP) acting as the transaction adviser.

OPGC, which was founded in November 1984, runs a modern, four-unit coal-fired power station. While two 210 MW units each have been in service for the past 25 years, the second phase of two 660 MW units each was added in 2019. The first two units receive coal through a subsidiary of OPGC from the neighbouring mines of Mahanadi Coalfields Limited, a division of Coal India Ltd. The last two units obtain coal from Manoharpur.

OPGC is considering expanding its current capacity through implementation of Phase III by constructing two more units with a capacity of 660 MW each, according to sources in the state energy department.

A number of officials questioned the state government's decision, even though the opposition parties have not yet responded to the Odisha government's decision to sell its stock in a PSU that is producing money.