XL Telecom & Energy Ltd has announced that the Company has decided to enter into “Power Generation Sector” with initial investments in Spain, the current global destination for Grid Connected Solar Energy.

Saptashva Solar, a subsidiary of the company, will establish a series of "Solar Farms" for power generation in Spain with a 28 MW capacity target for the first year. The medium term target is to install close to 200 MW of these farms in Spain and surrounding Portugal alone, an official release said.

There would be no dilution in the parent company as the investments are made in the wholly owned subsidiary of XL Telecom. The solar farms proposed to be set up in the first year would require a total investment of about €168 million or Rs 1000 crore, it added.

The project is expected to have debt equity ratio of 1:4 and would largely get funding from local banks. The first Solar Farm of 2.3 MW would be implemented before March, 2008 and the balance would get installed by Dec 2008.

XL Telecom & Energy Limited was incorporated in Hyderabad as a private limited company in 1985 and became a public limited company in 1990. The company is partnered by Corning, Inc. and Kyocera Inc. of USA.

The firm presently holds market cap worth Rs. 767 crore, PE Ratio of 34.76 ; EPS of 15.21 and BV of 105.68. The firm had showed a net profit of Rs 6 crore for the quarter ended September 2007 as against Rs. 4 crore in same quarter of last year.

The stock has given a return of 170% in last three months. Stocks from Power Sector are still looking good for long term investments. Torrent Power, Videocon Industries, Tata Power and Reliance Energy are the stocks to watch. IMP Powers is a good long term bet and is expected to offer decent gains.

The stock closed today at Rs. 528.70 on NSE, up by 5% compared with previous close of Rs. 503. It touched an intraday high of Rs 529 and low of Rs 490.