GSPC-LNG looking for Rs242cr cash injection
Mundra terminal operator GSPC-LNG wants to raise Rs242cr ($29m) by farming out equity to new shareholders.
A source tells us GSPC will use the money to pay EPC contractors for outstanding bills from the LNG terminal's construction and to repay short-term bank loans. "With a (potential) cash injection, the company can also seek additional disbursements against long-term loans (from banks who demand specific debt-equity ratios before paying out loans)," he says.
"Equity might come from the Gujarat government or government-owned companies." Among those cited are GSPC, Gujarat Maritime Board (GMB), Gujarat State Petronet and Gujarat Gas.
Private companies such as Adani Enterprises or LNG suppliers might also be interested. On August 2 (2023), GSPC's cash-rich city gas retailer Gujarat Gas announced an injection of Rs100cr ($11.97m) into GSPC LNG and a further cash injection is expected.
Gujarat Maritime Board (GMB) has the highest stake in GSPC-LNG, with a 43.3% stake. Next is the Gujarat government, with 36.65%.
Gujarat Gas, with 7.87%, is in third place, while GSPC holds 4.84% and Adani Enterprises holds 3.79%. Gujarat State Petronet holds a nominal 1.97%, while Gujarat Industrial Development Corporation (GIDC) and Gujarat Industries Power Company hold 0.79% each.
Mundra's approved project cost was Rs5041cr ($603.78m), financed through a 70:30 debt-equity ratio, where the equity portion is Rs1512.30cr ($181m). So far, the paid-up equity in GSPC LNG is Rs1270.13cr ($152m), leaving Rs242cr outstanding that must be raised.
Determining the size and the cost of the offloaded equity stake will be left to a registered valuer as GSPC-LNG is not a stock market traded company; additional shares might be disbursed in one or more tranches. But final approval rests with the company's board.
At the terminal itself, utilisation has languished below 30% since it was commissioned in February 2020. From April 1 (2023) to January 31 (2024), Mundra throughput was just 12.2% of the 5.5m t/y capacity, the worst of all the country's LNG terminals, according to PPAC figures.