Jindal power aims to outbid Adani in high-stakes battle for Indian coal-power plant

Adani Power had increased its bid from an initial 29.5 billion rupees, surpassing the 30.2 billion rupees bid made in December 2022 by state-run lenders Power Finance Corp (PFC) and REC Ltd.

 Jindal Power, a subsidiary of Jindal Steel and Power, has reportedly submitted a proposal to surpass Adani Power’s bid for a 1,980-megawatt thermal power plant in central India. This power struggle unfolds amid India’s pursuit of increased private investment in coal-fired power, responding to a surge in electricity demand, as highlighted by the power minister’s call for more participation last November.

The thermal power plant, known as the Amarkantak project, has been entangled in insolvency proceedings, prompting Jindal Power to appeal to India’s insolvency court for permission to enter the auction. According to sources, Jindal Power’s bid is not only competitive but offers better value compared to Adani’s previous offer of 41 billion rupees ($494 million) last month. The sources, requesting anonymity, revealed that Jindal Power’s proposal had not been previously reported.

Despite Adani Power’s revised bid being considered favourable by officials, the emerging competition from Jindal Power adds a new layer of complexity to the ongoing saga. Adani Power had increased its bid from an initial 29.5 billion rupees, surpassing the 30.2 billion rupees bid made in December 2022 by state-run lenders Power Finance Corp (PFC) and REC Ltd.

Private investments in coal-based power in India have dwindled since 2018 due to lower demand and a strong push towards renewable energy initiatives. The Amarkantak project, previously hindered by insolvency proceedings, is now up for a fresh auction mandated by the insolvency court. Participation in the auction is limited to those who submitted financial bids, excluding Jindal Power initially.

Adani Power’s revised bid is set to establish the base price for the auction, as reported by the sources. Jindal Power, despite expressing interest early in the insolvency process, was excluded from the auction for not submitting a financial bid. The company is now seeking court approval to join the bidding process, adding another layer of complexity to the situation.

It remains unclear how much Jindal Power intends to bid for the partly operational Amarkantak project, currently owned by the insolvent industrial group Lanco and situated in the central state of Chhattisgarh. This project is one among several distressed coal-fired private power stations facing insolvency proceedings in recent years, primarily due to challenges such as lack of fuel supplies or insufficient funds for completion.

As the battle for the Amarkantak project intensifies, industry observers are closely watching the proceedings, anticipating the impact on India’s power sector and the broader landscape of coal-based energy investments in the country. The outcome of this high-stakes competition will undoubtedly shape the future trajectory of these power assets and influence the dynamics of private investment in India’s energy sector.