OREANDA-NEWS. February 15, 2011. Tata Power, India’s largest integrated private power utility announced its consolidated and stand-alone financial results for the quarter ended December 31, 2010.

Key highlights Q3 FY2010-11: stand-alone

During the quarter, the company’s stand-alone results reflected a stable financial and operational performance. Revenues for the quarter were up by 4 per cent and stood at Rs1,595.87 crore as compared to Rs1,527.80 crore. Profit after tax (PAT) increased by 4 per cent to Rs153.07 crore, as against Rs147.89 crore registered in the corresponding quarter last year. The other income was up by 89 per cent at Rs85.24 crore, as compared to Rs45.17 crore in the corresponding quarter last year due to dividend received from a subsidiary, buyback of shares by another subsidiary and higher treasury income. Effective tax rate is also low since the dividend income (which is tax-free in the hands of the company) is higher. Deferred tax is low on account of lower wind capitalisation.

Key highlights Q3 FY2010-11: consolidated

On a consolidated basis, Tata Power’s revenues stood at Rs4412.91 crore, as compared to Rs4488.37 crore in the corresponding period last year. The company’s net profit rose by 348 per cent to Rs441.37 crore, as against Rs98.57 crore reported in Q3 of FY2009-10. Net PAT before share of associates, minority interest and statutory appropriations was up by 204 per cent at Rs464.11 crore, as compared to Rs152.73 crore for the corresponding quarter last year. Profit before tax (PBT) increased by 276 per cent to Rs672.96 crore, as against Rs179.21 crore in the corresponding period last year.

On a consolidated segment-wise performance, net revenue from power business was Rs2611.26 crore, as compared Rs2909.35 crore and from coal business, was Rs1672.31 crore, as compared to Rs1434.62 crore in the corresponding period last year. Profit before interest and tax (PBIT)from power business was Rs401.82 crore, as against Rs515.48 crore. The decrease was mainly due to low merchant rate realisation, lower AT&C incentives accrued by NDPL and unscheduled maintenance of DG sets. Whereas, PBIT from coal business was up at Rs432.57 crore as compared to Rs(171.17) crore reported in the corresponding quarter last year. The coal companies reported higher realisation although the quantity sold was lower than the corresponding period last year. Further, in the previous year, the carrying cost of deferred stripping was reviewed based on a technical report which resulted in a charge of Rs371 crore in Q3 FY2009-10. In this quarter, the deferred stripping cost has been capitalised to the extent of Rs71 crore.

Commenting on the company’s performance, Anil Sardana, managing director, Tata Power, said: “All our business divisions have performed well. Our operations continue to be stable and the new projects under implementation are progressing well. The quarter performance is in line with the growth target charted out by the company. Tata Power now moves into an exciting stage of commissioning its new projects at Maithon and Mundra.

We are committed to our sustainability agenda. The recent signing of the PPA with the Gujarat Government for 25 MW of solar power is a significant step in strengthening our renewable portfolio. Further, the acknowledgement and award received for Tata Power Energy Club have been very encouraging and we intend to take this movement to newer dimensions.”

Key highlights nine months FY2010-11 stand-alone and consolidated:

Tata Power’s stand-alone revenues for nine months stood at Rs4969.14 crore as compared to Rs5175.67 crore in the same period last year. Profit after tax (PAT) for the period stood at Rs673.78 crore, as against Rs708.16 crore in the corresponding period last year.

On a consolidated basis, revenues for the period were at Rs14,362.37 crore, up by 2 per cent compared to Rs14,065.16 crore in the corresponding period last year. The company reported net profit after statutory appropriations at Rs1,426.58 crore, as compared to Rs1,032.95 crore in the corresponding period last year. Net PAT before share of associates, minority interest and statutory appropriations was at Rs1,551.24 crore, as compared to Rs1,113.65 crore, up by 39 per cent for the same period last year.

On consolidated segment-wise performance, net revenue for power business was Rs9,108.76 crore and for coal business, was Rs4,686.29 crore, as compared to Rs9,450.94 crore and Rs4,112.18 crore respectively, during the corresponding period last year. PBIT for power business was Rs1,390.27 crore, as against Rs1,600.82 crore, and PBIT for coal business stood at Rs1,218.84 crore, as compared to Rs542.38 crore, over the corresponding period in the previous year.

OPERATIONAL AND BUSINESS HIGHLIGHTS:

During the quarter under review, the company’s operations continued to be stable. Sales volume for the quarter stood at 3,824 MUs and overall generation was 3,713 MUs. Trombay Thermal Power Station generated 2,374 Mus, as compared to 2,497 MUs in the corresponding quarter last year; Hydro-power stations generated 266 MUs, as compared to 328 MUs in the corresponding quarter last year and Belgaum generated 34 MUs, as compared to 111 MUs in the corresponding quarter last year. Jojobera Thermal Power Station generated 769 MUs, as compared to 687 MUs in the corresponding quarter last year. Haldia reported generation of 212 MUs, as compared to 167 MUs in the corresponding quarter last year. Power House number six was at 182 MUs, as compared to 166 MUs in the corresponding period last year. Wind farms generated 58 MUs, as compared to 59 MUs in the corresponding quarter last year.

Mumbai retail business:

The retail customer base in Mumbai crossed the one-lakh mark in December 2010. The rapid pace at which the consumer base has moved from 26,000 to 50,000, followed by 50,000 to 75,000 and now to 1,00,000, not only reflects the faith shown by the Mumbai consumers in the company but also endorses the quality and reliability that have been the hallmark of the company for several decades.

The company’s consumer mix at present comprises 78 per cent residential, 5 per cent industrial and 17 per cent commercial, which further reiterates its commitment in meeting changeover requests across user groups. In Q3, 19,638 changeover customers were added, taking the total number of changeover customers to 70,798. Three new bill collection centres were opened at Jogeshwari, Vile Parle and Powai.

North Delhi Power (NDPL): The company’s distribution subsidiary and joint venture with the Delhi Government, NDPL, posted revenues of Rs813.72 crore during Q3 ended December 31, 2010, as compared to Rs813.45 crore registered in the corresponding period of the previous year.

The PAT decreased to Rs34.78 crore, as against Rs68.39 crore in the previous quarter last year. This is mainly due to lower AT&C incentives accrued during the quarter. However, on the YTD basis, the AT&C incentives are higher than previous year.

Powerlinks Transmission (Powerlinks): Powerlinks, the first public-private joint venture in

power transmission in India has earned revenues of Rs73.48 crore in Q3 FY2010-11, as against Rs72.39 crore in the previous year. The PAT also decreased to Rs27.98 crore from Rs34.35 crore due to reversal in previous year of deferred tax provision made for the nine-month period.

Tata Power Trading Company (TPTCL): TPTCL traded a total of 730 MUs during the quarter as compared to 1083 MUs in the similar period of the previous year, thereby resulting in a decrease in its revenues to Rs253.66 crore from Rs561.14 crore in the previous year. The profit after tax was at Rs0.71 crore, as against Rs1.48 crore in the previous year, primarily due to poor merchant market and power rates.

GROWTH PLANS:

The progress on the company’s upcoming projects is as follows:

4,000-MW, Mundra Ultra Mega Power Project (UMPP): Mundra UMPP is progressing as per schedule with engineering, procurement and construction activities in full swing. Overall project progress achieved is 71 per cent. Unit 1 — turbine generator(TG) and auxiliary equipment pre-commissioning activities are progressing as per schedule. Unit 2 — boiler hydro test was completed. Equipment and piping erection is in progress. TG box-up was completed and HP piping is in progress. Unit 3 — TG has been delivered and erection started. Erection of boiler pressure parts for Units 4 and 5 is progressing well. The first unit is expected to be commissioned by September 2011.

1050-MW Maithon Project: The Maithon Project is also progressing well and has achieved 92 per-cent completion. Unit 1 boiler light up has been completed and Unit 1 is expected to be synchronised with oil by February 2011 and coal synchronisation is expected within a month thereafter.

Industrial Energy: 120-MW Unit 5 being constructed at the company’s existing site at Jojobera has been synchronised. The project is expected to be commissioned by March 2011.

114-MW Dagachhu Project: In partnership with The Royal Government of Bhutan (RgoB), the Dagachhu Project is progressing well. Major ordering for the project has been completed. All statutory clearances, land, water and environment clearances have been received and PPA for the entire quantum of power has been signed for the project. Civil works are in progress and around 1.3km of tunnelling has been completed. Work has also commenced on other fronts viz. desilter, surge shaft, weir, etc. Infrastructure activities like approach road, bridges, construction power, etc. have been completed. The first unit is targeted to be commissioned by March 2013.

Partnership with SN Power: The company has signed an exclusive partnership agreement with SN Power, Norway, to set up joint ventures for developing hydro-power projects in India and Nepal. Tata Power and SN Power have already begun pursuing potential project opportunities based on the vast reserves of renewable energy in the Himalayan region.

1600-MW Coastal Maharashtra Project: All statutory clearances required to start the project implementation are in place. Disbursement of compensation to land-owners is in progress by the Raigad district authorities and 45 per cent of private land has been covered till date. Activities pertaining to site enabling works have been identified and are being addressed. Specifications for boundary walls, site grading, roads and drains are under preparation.

660-MW Naraj Marthapur, Orissa: The environment clearance has been recommended by MoEF, subject to clearance from National Board of Wild Life (NBWL), for which the process is on. All the balance clearances for the project have been obtained. Land acquisition is currently in progress. Out of the total 990 acres of land, payment for over 600 acres of land has been completed. The entire land acquisition process, including the forest land, is expected to be completed by April 2011. The company has been allotted the Mandakini coal block located in the Angul district of Orissa, along with Monnet Ispat and Energy, and Jindal Photo, which will feed coal to the plant.

Tiruldih Power Project, Jharkhand (3 X 660 MW): The process of land acquisition for the project is in progress and is expected to be completed by March 2012. In-principle clearance has been received from Railways for transportation of coal from Tubed Coal Block (TCB). TCB has been jointly allotted to Tata Power and Hindalco in Jharkhand.

Satpura CBM Block: Tata Power, along with its consortium partner Arrow Energy, has been awarded the Satpura CBM Block in Madhya Pradesh during the CBM IV bidding round.

Renewable projects:

Wind power: Tata Power is the leading private wind-generation company with an installed capacity of 228 MW. Tata Power’s wind power capacity is spread across three states— Maharashtra, Gujarat and Karnataka. The company has placed an order for 150 MW of additional wind capacity to be set up in Maharashtra and Tamil Nadu.

Solar power: The company has signed a PPA with Gujarat Urja Vikas Nigam to develop a 25-MW solar photovoltaic project at Mithapur in Gujarat. The company is also implementing a 3-MW solar photovoltaic plant at Mulshi and will be one of the largest grid-connected plants in Maharashtra. The plant is expected to be commissioned by February end.

Geothermal power: Tata Power-led consortium comprising Tata Power (47.5 per cent), Origin Energy (47.5 per cent) and PT Supraco Indonesia (5 per cent) won the bid for the Sorik Marapi geothermal project in Northern Sumatra, Indonesia. The Sorik Marapi project is estimated to support the development of approximately 240 MW of geothermal generation capacity.

SUSTAINABILITY INITIATIVES:

Tata Power Energy Club:

In FY2010-11, the club plans to reach out to 275 schools nationwide and targets to save two million units. Last year being a year of unprecedented growth, this year is one of consolidation and quality management. Over 7.5 lakh students have been sensitised already and eight lakh units of electricity saved till date. Tata Power Energy Club won 'Gold' at ABCI Golden Jubilee Annual Awards Night in the environmental communication category. The club was ranked number two, out of the 22 entries for the earth-care category of Siemens Ecovative Awards 2010.