Finance deals with SBI, Federal Bank, TMB etc
THIRUVANANTHAPURAM: Kerala State Electricity Board Ltd (KSEBL), a perennial loss maker and one of the biggest public sector burdens for the state exchequer, has pruned its loss by about two-thirds during 2018-19 to Rs290 crore from Rs784.09 crore a year ago.
It is reliably learnt that the company has been able to reduce its finance cost substantially during 2018-19 thus effecting a drastic reduction in its loss incurred during the year.
KSEBL has signed financial deals with lenders such as SBI, Federal Bank, Bank of Baroda and Tamil Nadu Mercantile Bank in the past one or two months.
In fact, KSEBL has consistently been able to curb its annual loss, which was further high at Rs1494.63 crore during 2016-17. The KSEBL loss is generally made good by subsidy from Government or through additional revenue as decided by State Electricity Regulatory Commission (SERC).
According to a document seen by businessbenchmark.news, the additional chief secretary (finance) had sought clarification in respect of the spike in KSEBL’s administrative and general expenses, cost incurred on purchase of power and employee benefit expenses during the financial year 2018-19.
“It has also been resolved to approve the netting off of dues between the company (KSEBL) and Government of Kerala as on March 31, 2019, and to obtain the concurrence of the Government on the same,” said the document.
Finance cost has always been a spoilsport in the KSEBL financials and this has almost doubled during 2017-18 to Rs1814.69 crore from Rs989.92 crore a year ago though this is understood to have eased during the period under review.
Though the other numbers with respect to the 2018-19 financials are unavailable as of now, the trend has been that KSEBL generates only one-fifth of the electricity needs of the state, the bulk of the state’s power needs being purchased from outside. The company had an asset base of Rs30,560 crore as of 2017-18.
KSEBL had recently availed a working capital demand loan (WCDL) of Rs300 crore from Federal Bank as a sub limit of an overdraft facility to the tune of Rs350 crore, at an interest rate of 8.7 per cent.
In fact, State Bank of India (SBI) had replaced a Virtual Account System (VAS) facility for high tension and extra high tension (HT/EHT) payments earlier provided by Federal Bank.
SBI had also offered KSEBL a renewal enhancement of credit facilities including a term loan of Rs950 crore. The facilities offered by SBI were in the form of takeover of the loan from Federal Bank sanctioned against their VAS facility, whereas an earier Rs300 WCDL facility from Federal Bank was closed on December 11 using the term loan from SBI.
KSEBL has also availed a new facility and renewed an existing facility from Tamil Nadu Mercantile Bank as well as Bank of Baroda in the recent past, according to the KSEBL document.