Tata Power plans to invest in infrastructure sector

MUMBAI: Tata Power Company (TPC), India’s largest private power utility, plans an entry into the burgeoning infrastructure sector through investments urban transport, airport development and other projects.

TPC, which has an engineering and construction wing, will invest in infrastructure along with other group companies such as Tata Realty and Infrastructure, people familiar with the matter said.

But its prospects could depend a lot upon government policies, which has tended to be fickle in recent months, especially where large urban infrastructure projects are concerned.

In at least two cases, the Delhi Airport and the Mumbai Metro phase One, the winning bidders are wrangling with the government over issues such as the sudden change in terms and conditions and refusal to fulfil the initial promise of providing viability gap funding.

TPC is venturing into the new business after receiving a green signal from its parent, Tata Sons. The company has not yet decided about the investments, which will be required for its upcoming projects.

As a first step towards the ambitious foray, the company has submitted bid for city-side development of Udaipur airport, jointly with Tril Airport Development, a subsidiary of Tata Realty and Infrastructure (TRIL). Singapore airport operator Changi is the other partner in the TPC-led consortium.

“We are examining opportunities in infrastructure business along with other Tata group companies, which will bring value to the company,” said a spokesperson. It would set up separate division for the infrastructure business, which could be reshaped as a subsidiary in the future.