Mumbai, Sep 18 (IANS) Reliance Infrastructure (RInfra) Chairman Anil Ambani on Tuesday said he expects the company to become debt-free by next year with the best credit ratings to match following the sale of its Mumbai power business to Adani Transmission for Rs 18,800 crore earlier this year.
Addressing the company's annual general meeting here, Ambani said RInfra is on track to transform into a capital-light, high-growth, high-dividend company that will create more value for shareowners.
"We fully expect to be zero-debt by next year, with top-end credit ratings to match," the Chairman said.
"This year, we have successfully concluded the sale of our integrated Mumbai power business for a total consideration of Rs 18,800 crore -- the largest-ever quantum of debt reduction in the history of India's power sector."
This single transaction will help the company reduce its debt by 65 per cent, from around Rs 22,000 crore to Rs 7,500 crore.
Ambani said that defence, which has limited private sector participation in India, is a focus area for the company and would become the key business of the group in some years.
"We have entered into multiple partnerships with leading OEMs (original equipment manufacturers) from across the world, building a technology platform that is set to transform defence into one of our fastest growing verticals in the next 5 years," he said.
Speaking of the company's Delhi distribution business which distributes peak power of 5,000 MW and has a growth rate of over 5 per cent, Ambani said the debt of Delhi discoms has come down by 80 per cent, from a peak of Rs 8,000 crore to Rs 1,500 crore.
"Delhi discoms have reduced their AT and C (aggregate technical and commercial) losses from 57 per cent to just 9 per cent - the best performance across the distribution ecosystem in India," he said.
Ambani informed the AGM that the company has already won arbitration awards worth Rs 6,300 crore against various government agencies which are yet to be paid out, while arbitrations of another Rs 8,000 crore under advanced stages of approval.
"It is an unfortunate fact of doing business in India that despite amendments to the Arbitration Act by the Central government and clarity from the Supreme Court in multiple judgments, many government entities continue to drag their feet on arbitration award payouts to the detriment of shareholder interest," the Chairman said.
RInfra, the operator of the Mumbai Metro, has bagged the contract this year for the Versova-Bandra Sea Link project, which the Chairman described as "the largest urban infrastructure project in the country and represents our deep commitment to the city and people of Mumbai".