The Mint Report for 28 May 2012

The Mint Report for 28 May 2012

Tata Power is carrying out a large restructuring to help increase its cash flows and reassure its lenders. The company will hive off at least 75% of its stake in Indonesian coal mines to its subsidiary, Coastal Gujarat Power Limited. CGPL is setting up a 4,000 MW plant in Mundra. Lenders have given the project 14,000 crores in loans- but are not convinced the company has enough cash flow at the moment to service that debt. Back in 2007, Tata Power had bought 30% stakes in two Indonesian coal mines for a total of $1.23 billion.

And in other news, there’s a spot of relief for consumers grappling with high inflation. On Monday, petroleum minister Jaipal Reddy said the government doesn’t plan to raise the prices of diesel, kerosene and cooking gas any time soon. Last week, government-run oil companies increased the retail price of petrol by more than six rupees nationwide.

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And finally, Indian shares rallied on Monday, with global conditions improving and despite continuing worries about India. The Sensex shot up 199 points to 16,417. And the Nifty climbed 65 to 4,986.