Andhra Pradesh-Transco to tap the capital markets soon

As part of its major financial restructuring plan, the Transmission Corporation of Andhra Pradesh Limited (AP-Transco) is gearing up to float an Initial Public Offering (IPO). This is to tap the capital markets as per the Ministry of Power (MoP)’s mandate that at least one power utility in each State should undertake an IPO subject to the prescribed eligibility conditions stipulated in the draft Fiscal Responsibility and Budget Management (FRBM) framework issued by the MoP.

With this, AP-Transco was instructed to prepare and formulate a time-bound roadmap for facilitating the proposed IPO following a decision taken by Chief Minister N. Chandrababu Naidu in a high-level review meeting on the power sector held in August 2026, according to a Transco Office Order (TOO) issued by the Andhra Pradesh Government Special Chief Secretary (Energy) and AP-Transco CMD K. Vijayanand on October 21.

He stated that the financial restructuring plan encompasses both short and long-term strategies drawn up to strengthen the AP-Transco’s financial position and ensure its financial sustainability.

Short term plan

The short-term plan’s focus is on rationalisation and optimisation of the AP-Transco’s existing loan portfolio in order to reduce the interest cost on outstanding borrowings to a targeted range of 8.00% to 8.60%, while the long-term plan is targeted at restructuring borrowings to strengthen power utility’s creditworthiness with the ultimate objective of achieving AAA+ rating.

It was mentioned in the TOO that the MoP has been consistently emphasising the need for expeditious action towards completion of all preparatory activities and requisite formalities for initiating the IPO processes of the power utilities to facilitate timely implementation.

Taking the IPO proposal forward, AP-Transco identified the Key Result Areas (KRAs) with actionable items for timely completion of the roadmap.

The KRAs are regularisation of land properties recorded in the books of AP - Transco, improvement of financial parameters and ratios to enhance the credit rating, exploring project finance through various sources, exploitation of leasing of dark fibres for enhancing non - tariff income and implementation of ISO 55001:2024 Asset Management Certificate.