Sri Lankan conglomerate buys mini hydro plant for Rs. 900 million
Sri Lanka’s Aitken Spence PLC has reportedly announced the acquisition of mini-hydro power firm Waltrim Energy Ltd. for Rs. 900 million indicating the company’s confidence in the renewable energy generation sector.
Aitken Spence has reportedly noted that it had entered into an agreement with shareholders of Waltrim, a subsidiary of Sunshine Holdings PLC, owning 60% stake, and Mouldex owning the balance.
According to reports, Waltrim operates three hydropower generation plants in Nuwara Eliya with a total capacity of 6.6 MW under separate wholly-owned subsidiaries – Waltrim Hydropower Ltd., Upper Waltrim Hydropower Ltd. and Elgin Hydropower Ltd.
Aitken Spence’s power sector interests include a 100 MW thermal power plant, a 3 MW wind power plant, a 2.5 MW hydro power plant and the country’s first 10MW waste-to-energy plant commissioned recently.
The power sector exposure is via strategic investments that include plantations, printing and apparel manufacturing and this segment’s revenue in the first nine months of FY21 was Rs. 12 billion, down from Rs. 14 billion a year earlier. Profit from operations was Rs. 840.5 million, lower in comparison to Rs. 1.28 billion in the first nine months of FY20, according to the Daily FT.
Separately Sunshine Holdings has stated that it had sold its entire 60.59% stake in Waltrim Energy for Rs. 545.3 million.
Also, Sunshine via a joint venture with SBI Holdings – Japan separately operates a 1 MW of electricity from rooftop solar and aims to increase to 9 MW in the near future, for which it raised US$ 2 million in additional funding and Sunshine’s overall energy sector revenue had increased to Rs. 348 million in the first nine months of FY21 from Rs. 255 million a year ago due to higher rainfall in the catchment areas in 1HFY21. This has resulted in a profit-after-tax of Rs. 108 million compared to a profit-after-tax of Rs. 29 million reported last year, local media reports added.
OSL take:
The procurement of a hydro power plant by a Sri Lankan conglomerate is indicative of the growing business/investment opportunities in Sri Lanka’s renewable energy generation sector. Sri Lankan authorities are committed to increasing the country’s renewable energy generation capacity. Given the country’s looming power crisis, opportunities in Sri Lanka’s renewable energy generation sector are further expanding. Sri Lanka is also becoming a business hub in the South Asian region given its geographical positioning in the Indian ocean and the many trade agreements as well as the trade concessions enjoyed by the country. Foreign businesses/investors could explore business/investment opportunities in Sri Lanka’s renewable energy generation sector.
| Article Code : | VBS/AT/20210421/Z-1 |