Nalco & NTPC to jointly initiate Power Project in Odisha

NALCO and state-owned power producer NTPC Ltd and signed a deal to jointly set up a
2.4 giga watt (GW) power plant and one million tonne
aluminium production facility in Odisha with an investment
of more than Rs 36,000 crore. Formal joint venture and
power purchase agreements will be in place by the end of
the ongoing financial year.
The suggested power plant at Gajmara will costitute three
units of 800 mega watts (MW) each and will extract coal
from the mines under Nalco. The plants will have Nalcos
factory at Angul as a power customer.
The aluminium smelter project and the power project will accelerate the industrial
growth in the region. Thus, it will create direct and indirect employment for engineers,
supervisors and skilled, semi-skilled and unskilled workers.
Piyush Goyal, Power minister is of the view that coal, which is available in ample amount
at present, will make the new power project viable in Odisha and also enable production
of aluminium cost competitive. Currently, aluminium use is going up in the automobile
and aerospace industries to improve energy efficiency. The joint venture was part of the
Make in India drive.
Dharmendra Pradhan, Oil minister informed that the government was committed to
building these plants with the best clean coal technology available in the world to keep
pollution under check.
The construction of the power plants and the aluminium production unit will be
executed in four years. The joint venture attempts to keep the cost of power generation
to a minimum so as to benefit aluminium production.

Stock Analysis
Nalco share price was last trading in NSE at Rs. 61.75 as compared to the previous close
of Rs. 61.00. The total number of shares traded during the day was 24,78,727 with a
traded value of Rs. 1,520.45lacs, as per NSE.

The stock hit an intraday high of Rs. 62.85 and intraday low of Rs. 60.25. Dynamic Levels
have identified Nalco as one of the top 500 performing stocks for this quarter, owing to
its strong fundamentals.

Road Ahead
NTPC is in the process of diversifying into the commodities business, apart from entering
into clean energy and nuclear energy sectors.
The government had given the approval to a deal between NTPC and Coal India Ltd in
May in order to initiate three fertilizer factories with a total investment of Rs 20,000
crore. State-run Indian Oil Corp. Ltd is anticipated to join the project for which
state-owned Fertilizer Corp. of India Ltd. will provide land. The power producer also has a
joint venture with Nuclear Power Corp. of India Ltd (NPCIL) for establishing two 700 MW
nuclear power plants in Gujarat.
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Article Written by
Madhurima Chowdhury