NTPC’s Jhabua Power bid hits NPA tag hurdle

State-owned power giant NTPC Ltd NSE 0.00 % faces a Section 29A hurdle in its bid for Jhabua Power, a clause embedded in the Insolvency and Bankruptcy Code (IBC) that prevents bidders from buying insolvent companies if they themselves or their associate companies have a track record of default, according to multiple executives.

NTPC owns stakes in Ratnagiri Gas and Power Ltd and Konkan LNG. Both companies had defaulted on loans prior to the commencement of Jhabua Power’s insolvency proceedings.