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Caparo Energy May Need $510 Million to Fund Wind Turbines Orders

Caparo Energy, a Guernsey company that is the holding company for subsidiaries (together, the “Group”) that seek to generate wind power in India.

The Group intends, in due course, to acquire and develop a portfolio of wind farms with a target total annual installed capacity of up to 5,000 MW, which it intends to develop in two concurrent phases: Phase I consisting of 3,000 MW with a target completion date of 2016; and Phase II consisting of 2,000 MW with a target completion date of 2017.

Caparo has been talking about its Phase I of the project from May of last year, and once again in January this year when they  posted their  maiden interim results and announced the details of senior debt facility of Rs 4.5 bn that they had finalized. Again in April this year, Caparo Energy announced plans to raise $150 million (Rs. 7 billion) through private equity.

According to reports, Caparo Energy Ltd., the Indian wind farm developer backed by Blackrock Inc., may need $510 million in financing to begin paying for the $3 billion in wind turbines it has ordered, according to Religare Enterprises Ltd.

Mark Thompson, a clean-technology equity analyst at the Delhi-based financial services company, said Caparo must raise the money to meet its commitments to buy the windmills for clean-energy projects it’s planning.

The Hyderabad-based company, which has no operating projects, lost about 13 percent since money managers including New York’s Blackrock and Henderson Group Plc (HGG) of the U.K. bought stock in October in its 50 million-pound ($80 million) initial public offer in London.

Since then, the company has unveiled the most ambitious plans among Indian wind-park developers, including orders from Suzlon Energy Ltd. and Spain’s Gamesa Corp. Tecnologica SA for 3,000 megawatts of windmills. That power capacity exceeds the combined installations by all other wind-energy developers in 2010 in India, the world’s third-largest market for wind parks behind China and the U.S.

The company is “on track” to raise what it needs and meet its targets for starting up wind farms, Caparo Chief Executive Officer Ravi Kailas said in an e-mail on June 6. He declined to elaborate, saying another announcement would be made soon.

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