TNB’s strong foothold

Malaysia’s Tenaga Nasional Bhd (TNB) sees future value in India’s large and supply constrained power market which is projected to have compounded annual growth rate of between six to seven per cent.

“Growth in power generation is crucial to the success of India’s ‘Make In India’ industrialisation programme and progressive development of reliable supplies of new power will be needed to support the creation of new manufacturing bases throughout the country,” said TNB President and chief executive officer Azman Mohd.

“Strong growth in both the economy and energy demand coupled with a favourable energy policy framework means that this deal offers TNB attractive opportunities in the power sector on the sub-continent and establishes a strong foothold in the Indian power market,” he said on completing TNB’s 30 per cent stake acquisition in GMR for US$300 million.

The acquisition marks TNB’s entry into India’s rapidly expanding power sector, where demand for electricity posted compound annual growth rate of between six and seven per cent, adding 20-GW of new capacity annually, an amount equivalent to Malaysia’s current installed capacity.

The growth in India’s electricity consumption was in line with TNB’s international expansion roadmap to secure new generation capacity overseas, Azman added.

“We believe the deal makes strong commercial sense by increasing our competitiveness, maximising shareholder value and delivering sustainable long-term earnings growth.”

The acquisition marks TNB’s entry into India’s rapidly expanding power sector, where demand for electricity posted compound annual growth rate of between six and seven per cent, adding 20GW of new capacity annually, an amount equivalent to Malaysia’s current installed capacity.

It also cements a strategic investment in GMR Energy, which has a portfolio of five operational power assets in India comprising coal, gas and renewable energy with a combined capacity of 4,630MW. fii-news.com