OPG Power Ventures falls on GBP2.5 million hit from coal tax rise

(Alliance News) - OPG Power Ventures PLC shares plunged on Monday as it said it expects an annual cost increase of around GBP2.5 million due to changes to the goods and services tax rate on coal in India.

Shares in the Isle of Man-based developer and operator of power plants in India were down 17% to 5.95 pence in London on Monday morning.

The company said the rate on coal in India was increased to 18% from 5% on Monday. At the same time, the compensation cess levied on coal of INR400 per tonne, or around GB3.36, is expected to be abolished and subsumed within the new tax rate.

OPG said the overall impact on the tax burden for coal is dependent on its specific import and domestic and domestic procurement mix.

The thermal power plants using imported coal as a primary fuel source are expected to see an increase in their generation costs after the increase of GST in coal, OPG noted.

Following the abolishment of the cess, companies will remain unable to claim input credits due to electricity being outside GST under the new regulations.

OPG said its Indian power plants rely on coal as a primary fuel source. Based on the current coal procurement mix, it expects an annual cost increase of around GBP2.5 million.

By Michael Hennessey, Alliance News reporter

Comments and questions to newsroom@alliancenews.com

Copyright 2025 Alliance News Ltd. All Rights Reserved.