Torrent Power Emerges as Top Bidder in Raigarh Land Sale
RAIGARH (India CSR): In a significant development for India’s corporate landscape, a Gujarat-based company, reportedly Torrent Power, has acquired approximately 730 acres of land previously owned by the bankrupt Visa Power Limited in Raigarh, Chhattisgarh. The auction, finalized on August 20, 2025, fetched a staggering Rs 400 crore, marking a pivotal step in resolving the financial fallout of Visa Power’s insolvency. This acquisition highlights the growing interest in distressed assets and underscores Gujarat’s expanding influence in India’s industrial sector.
Background of Visa Power’s Insolvency
Visa Power Limited, once envisioned as a key player in Chhattisgarh’s power sector, aimed to establish a 1,200 MW thermal power plant in Devri and Doomarpali villages of Raigarh district. The company signed a Memorandum of Understanding (MoU) with the Chhattisgarh government in 2005, securing contracts with major firms like Bharat Heavy Electricals Limited (BHEL) and Larsen & Toubro. However, mismanagement and financial irregularities led to the project’s collapse by 2014. Unable to repay loans, Visa Power was declared bankrupt by the National Company Law Tribunal (NCLT) Kolkata Bench, triggering a liquidation process to settle debts estimated at Rs 4,000 crore, of which Rs 3,000 crore were approved claims.
Auction Details and Winning Bid
The liquidation process culminated in the auction of Visa Power’s assets, including 730 acres of land comprising 587.51 acres of privately owned land, 99.02 acres leased from the state’s industries department, and 39.85 acres purchased directly by the company in villages such as Dongitarai, Kiritamal, and Pandripani. The reserve price for the land was set at Rs 170 crore, with an additional Rs 1.95 crore for the smaller parcel and Rs 71.60 crore for other company assets. Sources indicate that Torrent Power, a leading Gujarat-based integrated power utility, placed the highest bid of approximately Rs 400 crore, though neither party has officially confirmed the transaction. The auction, conducted under NCLT oversight and following a Supreme Court directive to exclude machinery from the sale, marks a significant recovery effort for creditors.
Financial Irregularities and Legal Battles
Visa Power’s downfall was marred by allegations of financial misconduct. In August 2023, the Central Bureau of Investigation (CBI) filed an FIR against the company’s chairman, Vishambhar Sharan, managing director, Vikas Agrawal, and joint managing director, Subrato Dwivedi, accusing them of diverting Rs 1,964 crore in bank loans to purchase shares and equity in other companies. This fraud left public sector banks and operational creditors, including BHEL, with significant losses. BHEL, which had secured a Rs 2,665 crore contract for machinery supply, faced non-payment, and much of the installed equipment was later scrapped and sold to local steel plants, with no reported police action against the culprits.
Implications for Creditors and the Region
The successful auction of Visa Power’s land offers a lifeline to creditors, particularly the 11 banks and BHEL, who have been grappling with unpaid dues. The Rs 400 crore bid, while substantial, covers only a fraction of the Rs 4,000 crore debt, highlighting the challenges of recovering funds from distressed assets. For Raigarh, the sale could pave the way for renewed industrial activity, with Torrent Power’s expertise in power generation and distribution potentially revitalizing the region. The company’s recent ventures, including a 5 GW renewable energy portfolio and 6,000 hectares of land allocated for solar and wind projects in Gujarat, suggest a strategic expansion into Chhattisgarh’s industrial landscape.
Torrent Power’s Strategic Expansion
Torrent Power, a Rs 10,244 crore conglomerate, is a major player in India’s power sector, with a generation capacity of 3,588 MW, including 436 MW from renewables. The company’s acquisition of Visa Power’s land aligns with its ambitious growth plans, which include expanding its renewable energy footprint. In 2023, Torrent Power secured 6,000 hectares in Gujarat for renewable projects and has won multiple solar and wind auctions, including a 300 MW solar project in Gujarat and a 100 MW wind project in Karnataka. This move into Chhattisgarh could signal further diversification, leveraging the acquired land for renewable energy or industrial development.
Future Outlook for Distressed Asset Sales
The Visa Power auction underscores the growing role of insolvency proceedings in resolving corporate failures in India. The Insolvency and Bankruptcy Code (IBC), amended to enforce stricter timelines, has accelerated the liquidation of non-performing companies. However, the scrapping of Visa Power’s machinery highlights gaps in asset protection during insolvency, raising questions about enforcement and oversight. As India’s industrial sector evolves, such auctions could attract more players like Torrent Power, driving economic recovery in regions like Raigarh while addressing the financial burdens of creditors.
(India CSR)
