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Essar Power says it will make a profit in fiscal year 2017

Essar Power Ltd, part of the debt-laden infrastructure conglomerate Essar Group, says it will make a net profit in fiscal 2017 after four years of losses and is looking at becoming a zero-debt company in the next three years.

In an interview, Essar Power managing director and chief executive officer Sushil Maroo said lower domestic and international coal prices, a revival in demand following the government’s power sector revival package and better plant utilization have helped the company improve its financial performance.

The claims come at a time when the Essar Group seeking to bring in investors in other group companies including Essar Steel India Ltd to bring down debt levels. In November last year, Essar Steel said that it will bring in a strategic partner into it steel division but a deal is yet to be struck. In July, the Essar Group agreed to sell 49% in Essar Oil Ltd to Russia’s OAO Rosneft. That deal is yet to be closed as well.

In the interim, Essar Power has seen its performance improve.

“Essar Power is on the verge of a major turnaround for the first time in last four years’ operations. The company has posted around Rs.600 crore of losses. The year 2015-16 would be profit after tax positive,” Maroo said.