Tata Group-Backed Power Stock Secures Karnataka Transmission Project With Annual Charges Of Rs 521 Crore

On Friday, Indian equity benchmarks traded lower, with the Nifty 50 declining 237.35 points, or 0.98 per cent, to 23,930.65. Amid the broader market weakness, Tata Power share price traded at Rs 400, down Rs 2.90 or 0.72 per cent during the session.

Tata Power Receives Letter Of Intent

Tata Power informed exchanges that it has received a Letter of Intent (LoI) from REC Power Development and Consultancy Limited (RECPDCL), a wholly owned subsidiary of REC Limited, for the acquisition of Ryapte Power Transmission Limited, a project special purpose vehicle (SPV).

The project will be executed under the Build-Own-Operate-Transfer (BOOT) model and will provide transmission services for a period of 35 years from the Scheduled Commercial Operation Date (SCOD). The project is expected to be commissioned within 30 months from the effective date of transfer of the SPV.

Annual Transmission Charges Of Rs 521 Crore

Under the concession agreement, Tata Power will receive Annual Transmission Charges (ATC) of Rs 521.07 crore. The project has been awarded for a concession period of 35 years, providing long-term revenue visibility for the company.

The award further strengthens Tata Power's transmission portfolio and reinforces its position in India's growing power transmission infrastructure segment.

Tata Power Company Project Scope

The project involves the construction and commissioning of approximately 250 kilometres of transmission infrastructure across Karnataka.

The scope includes the development of 400 kV double-circuit transmission lines connecting the Ryapte AIS sub-station with the proposed Doddathaggalli GIS sub-station, along with transmission connectivity between the existing Kolar sub-station and Doddathaggalli.

Additionally, the project includes the construction of 220 kV double-circuit transmission lines connecting Doddathaggalli with the existing substations at Ekarajapura, Hosakote and Sarjapura. The project will also feature 220 kV underground cable systems linking these substations.

As part of the infrastructure package, Tata Power will establish a 5x500 MVA, 400/220 kV AIS sub-station at Ryapte in Tumkur district, along with 2x125 MVAr 400 kV bus reactors. The company will also develop a 3x500 MVA, 400/220 kV GIS sub-station at Doddathaggalli near Hosakote, equipped with similar reactor systems.
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Strengthens Transmission Business

The project is expected to play an important role in strengthening power transmission infrastructure in Karnataka and supporting the state's growing electricity demand. The long concession period and regulated transmission charges provide stable and predictable cash flows for the company.

Tata Power clarified that the project has been awarded by a domestic entity and does not constitute a related-party transaction. The company also confirmed that neither its promoter group nor associated entities have any interest in the awarding authority.

About Tata Power Company

Tata Power Company Ltd is one of India's largest integrated power companies with operations spanning generation, transmission, distribution, renewable energy, solar manufacturing, EV charging infrastructure and power trading. The company has been actively expanding its renewable energy and transmission portfolio, positioning itself as a key participant in India's energy transition and infrastructure development initiatives.

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Disclaimer: The article is for informational purposes only and not investment advice.