OREANDA-NEWS. November 15, 2011. Tata Power, India’s largest integrated private power utility, today, announced its consolidated and standalone financial results for the quarter ended September 30, 2011.

Key highlights Q2 FY2011-12: Tata Power (standalone)

During the quarter, Tata Power’s results reflected a robust financial and operational performance. Revenues for the quarter were up by 19 per cent and stood at Rs1,864.39 crore as compared to Rs1,570.82 crore, in Q2 FY2010-11. PAT increased by 13 per cent to Rs281.50 crore as against Rs248.73 crore registered in the corresponding quarter last year. PBT for the quarter was up by 65 per cent at Rs499.58 crore as compared to Rs303.40 crore in the same quarter last year. During the quarter, other income stood at Rs385.09 crore as against Rs156.97 crore in the previous quarter, a rise of 145 per cent. Other income this quarter also included a dividend of Rs268 crore received from the overseas coal SPVs.

Key highlights Q2 FY2011-12: Tata Power consolidated

On the consolidated basis, Tata Power’s revenues were up by 30 per cent and stood at Rs6,248.33 crore as compared to Rs4,797.84 crore in the corresponding period last year. Profit from operations before other income, interest, exceptional items and tax increased by 21 per cent from Rs890.33 crore to Rs1,078.13 crore.

The company’s net profit / (loss) was Rs(1,218.86) crore against Rs672.54 crore in the corresponding quarter last year. Net profit is not comparable due to the provision made for impairment of Rs823 crore and forex loss of Rs638.96 crore incurred by Coastal Gujarat Power (CGPL) a wholly-owned subsidiary, which is in the process of implementing the 4,000MW Ultra Mega Power Plant at Mundra in this quarter.

Based on assessment of fuel and other operating costs on cash flows for the Mundra project, a provision has been made for impairment loss. Given the volatility of coal prices, the assumptions will be monitored on a periodic basis and necessary adjustments will be made if external conditions relating to the assumptions indicate that such adjustments are appropriate.

The company’s investments in coal companies in Indonesia were made to secure long-term coal supply. In order to provide protection from the risk of price volatility on coal to be used in power generation in CGPL, to the extent not covered by price escalations and to support its cash flows, the company will be undertaking a restructuring and will transfer at least 75 per cent of the ownership of the investments in the coal companies to CGPL in the current financial year, subject to receipt of regulatory and other necessary approvals. It will also evaluate other alternate options. Keeping in mind the overall returns from the company’s investment in CGPL, including the proposed shareholding of CGPL in the coal companies, no provision for diminution in value is considered necessary in the standalone accounts of the company.

 The company’s net profit after appropriations was Rs(1,218.86) crore as against Rs672.54 crore reported in Q2 of FY2010-11. On consolidated segment-wise performance, revenues from power business has increased by 31 per cent to Rs3,934.43 crore as compared to Rs2,992.69 crore registered in the corresponding quarter last year. The coal business contributed Rs2167.29 crore to the revenues, an increase of 47 per cent as compared to Rs1,474.92 crore, during the corresponding quarter last year.

Profit before interest, tax and exceptional items excluding exception items for power business segment stood at Rs462.15 crore, as compared to Rs471.13 crore in the corresponding period last year. Whereas, PBIT for coal business stood at Rs596.24 crore as compared to Rs362.30 crore, 65 per cent higher than the corresponding quarter last year.

Key highlights H1 FY2011-12: Tata Power (standalone)

During the half year ended September 30, 2011, Tata Power’s Revenues was up 10% and stood at Rs. 3706.46 Crores. Profit After Tax (PAT) for the half year was up by 8% at Rs. 551.19 Crores as compared to Rs. 511.71 Crores for the same period last year. PBT for the quarter was up by 38% at Rs. 929.51 Crores as compared to Rs. 675.55 Crores in the same quarter last year. During the quarter, Other income stood at Rs. 645.09 Crores as against Rs. 282.62 Crores in the previous quarter, a rise of 128%.

Key Highlights FY12: Tata Power Consolidated

During the half year ended September 30, 2011, Tata Power’s revenues stood at Rs12,053.15 crore, up by 21 per cent as compared to Rs9,949.46 crore in the same period last year.

The net profit / (loss) after statutory appropriations stood at Rs(800.29) crore as compared to Rs984.21 crore in the corresponding period in the previous year. Net profit is not comparable with last year due to impairment provision made in CGPL and forex losses of Rs642.62 crore incurred as compared to the corresponding period last year. The differential cost Rs50.39 crore in power supply at 1,050 Maithon Power Project also impacted the profitability.

In segment-wise performance, revenues for power business was up by 18 per cent at Rs7,654.73 crore and coal business was up by 38 per cent Rs4,157.98 crore as compared to Rs6,497.50 crore and Rs3,013.98 crore respectively during the corresponding periods last year. Profit before interest, tax and exceptional items for power business was Rs1,089.15 crore as against Rs988.45 crore and PBIT for coal business increased to Rs1,346.31 crore as compared to Rs786.27 crore, in the corresponding periods last year.

Commenting on the company’s performance, Anil Sardana, managing director, Tata Power, said:

“The company’s operations continue to be robust and the quarter gone by saw improved performance of all our businesses. All Tata Power operations and subsidiaries have done well this quarter as well as in half year as compared to the corresponding period last year. The 4,000MW Mundra Ultra Mega Power Project and the 1,050MW Maithon Power Project are in advanced stages of completion. We are also on track on all our other projects which are under implementation.

"One of the key highlights this quarter is the provision made for impairment of Rs823 crore in CGPL, the wholly-owned subsidiary implementing Mundra UMPP. This has been done primarily on the projected fuel costs that has an impact on future cash flows. Further, to provide protection from the risk of price volatility on coal to be used in power generation in CGPL, and to support its cash flows, the company will be undertaking a restructuring and will look at the option of  transferring  at least 75 per cent of the ownership of the investments in the coal companies to CGPL or else evaluate alternate options to give effect to the above objective of protection. Hence, no provision has been considered necessary for standalone purpose.

"As a company, we are committed to reducing carbon footprint through investment in renewables. We are happy to announce that our wind power project has crossed 300MW capacity. All our other renewable projects including solar and geo-thermal are on track.”

He further added, “Amongst all this, our commitment to environment remains a key priority. We are happy to have been bestowed with the Greentech Gold Award for excellence in Environment Management and ranked 12th in Asia amongst utilities by Platts."

Operational and business highlights:

During the quarter under review, the company’s operations performed well and continued to be robust. Sales volume for the quarter stood at 3,793MUs and overall generation was 3,772MUs. Trombay Thermal Power Station generated 2,120MUs as compared to 2,263MUs in the corresponding quarter last year; hydro power stations generated 495MUs as compared to 318MUs in the corresponding quarter last year and Belgaum generated 3MUs as compared to 61MUs in the corresponding quarter last year. Jojobera Thermal Power Station generated 735MUs as compared to 770MUs in the corresponding quarter last year. Haldia reported a rise in generation to 197MUs as compared to 155MUs in the corresponding quarter last year. Industrial Energy (IEL) reported increased generation of 375MUs as compared to 212MUs in the corresponding period last year. Wind farms generated 220MUs as compared to 129MUs in the corresponding quarter last year. Solar plants recorded in generation of 1MU.

Mumbai retail business: Retail customer base in Mumbai crossed the quarter-million mark on August 15, 2011. As on September 30, 2011, customer base stood at 260,894. Overall retail sale growth in the quarter is 36 per cent as compared to the same quarter last year. Two new customer relation centres (CRC) were opened at Bhayander and Borivali. Upgradation of payment kiosks in Borivali and Saki CRCs was completed allowing consumers to view / print bills and make online payment through credit card at the CRC itself.

North Delhi Power (NDPL): The company’s distribution subsidiary and joint venture with Delhi Government, NDPL posted revenues of Rs971.39 crore during Q2 ended September 30, 2011, as compared to Rs820.96 crore registered in the corresponding period of the previous year. The profit after tax was at Rs86.16 crore as against Rs74.13 crore in the corresponding quarter last year. The regulator has revised the tariff effective September 1, 2011, by an average of 22 per cent.

Powerlinks Transmission (Powerlinks): Powerlinks, the first public-private joint venture in power transmission in India, has earned revenues of Rs72.27 crore in Q2 FY2011-12 as against Rs73.73 crore in the corresponding quarter year. The profit after tax stood at Rs29.54 crore as compared to Rs27.53 crore in the corresponding period last year.

Tata Power Trading Company (TPTCL): TPTCL traded a total of 1,570MUs during the quarter as compared to 1,067MUs in the corresponding period last year, thereby resulting in revenues of Rs394.18 crore as compared to Rs418.36 crore in the corresponding quarter last year. The profit / (loss) after tax was at Rs3.33 crore as against Rs(1.83) crore in the previous quarter last year.

Growth plans:

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

4,000MW, 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 85 per cent. The first 800MW Unit 1 has been ready for synchronisation since June 29, 2011, awaiting transmission evacuation system from PGCIL which has got commissioned on September 29, 2011. Contractually, it requires seven months post availability of transmission lines to stabilise a unit. The company aims to stabilise Unit 1 of Mundra UMPP in 4-5 months. Work on Units 2, 3, 4, and 5 is also on track and progressing well.”

1,050MW Maithon Project: The Unit 1 has achieved full load on June 30, 2011. The unit is under stabilisation. All the balance finishing work is expected to be completed by end November 2011. In Unit 2, boiler light up was completed on August 29, 2011.

114MW Dagachhu Project: In partnership with The Royal Government of Bhutan (RGoB), this 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. Infrastructure activities like approach road, bridges, construction power, etc. have been completed. Given the geological conditions, the project is facing some delay but all efforts are being made to commission the unit by 2013.

236MW Dugar Hydro Power Project: The Tata Power – SN Power Consortium JV won the bid for the 236MW Dugar Hydro Power Project in Himachal Pradesh. The capacity for Dugar Hydro Electric Project is estimated to be approximately 236MW. The run of the river 'Dugar Hydro Electric Project' will primarily feed the northern grid.

Renewable projects:

Wind Power: Tata Power is the leading private wind generation company, with an installed capacity of 349MW. Tata Power’s wind farms are spread across four states namely Maharashtra, Gujarat, Tamil Nadu and Karnataka, the leading states in promoting wind power generation in India. An additional 64.5MW capacity is under execution and will be commissioned by Q3 FY2011-12 in Tamil Nadu and Maharashtra.

Solar Power: The company is developing a 25MW solar PV plant in Mithapur, Gujarat, and has signed a PPA with GUVNL for the same. This plant is targeted for commissioning by December 2011. 

Geothermal power: Tata Power-led consortium along with Origin Energy, Australia and PT Supraco, Indonesia, won the 240MW Sorik Marapi Project. The expected COD for the project is June 2015.

Kalinganagar, Orissa 652.5MW (gas based) + 3X150MW (Coal+gas based)

The project is being executed through Industrial Energy, a JV of the company with Tata Steel. Tata Steel has commenced its project (3MTPA steel plant) related works and has requested the company to initiate the enabling works related to the power plant. Tata Steel has obtained environment clearance (EC) for gas-based plant along with their steel plant. Water allocation has also been obtained. The process has been initiated for obtaining coal linkage, water allocation, EC, etc for the coal-based plant.

1,600MW Coastal Maharashtra Project: All statutory clearances required to start the project implementation are in place. Land acquisition is in progress. The company also signed an agreement with the Maharashtra state government for the R&R package for the farmers in the Dehrand / Shahpur villages. Economic options for coal sourcing and logistics are under evaluation.

660MW Naraj Marthapur, Orissa: The major clearances for the project have been obtained. Land acquisition is currently in progress. The environment clearance has been granted by MoEF, subject to clearance from the National Board of Wild Life, for which the process is on.

1,980MW Tiruldih Power Project, Jharkhand: The process of land acquisition for the project is in progress. In principle clearance has been received from Railways for transportation of coal from the Tubed Coal Block. Tubed Coal Block has been jointly allotted to Tata Power and Hindalco in Jharkhand.

Sustainability initiatives:

Demand Side Management (DSM) Programmes:

The company has launched several DSM programmes which are approved by the regulator. Now, the company has a portfolio of eight DSM programmes for different categories of consumers.

Tata Power Energy Club:

In FY2011-12, Tata Power Energy Club will be reaching out to 400 schools nationwide (Mumbai, Delhi, Kolkata, Pune, Ahmedabad, Bengaluru, Lonavla, Jamshedpur, and Belgaum) to sensitise over 2.8 million citizens across the country and save more than 3 million units. The club has a strong, sustainable and replicable model to spearhead the movement. It is targeting more than 1,000 self-sustaining mini energy clubs this year across the country. The club is proud to have near than 26,895 Energy Champions and 39,356 Energy Ambassadors, spreading the mantra of energy conservation.

Awards and recognitions:

Tata Power was ranked 12th in Asia amongst utilities (Electric Utilities in Asia) and 53rd in the Top 250 Global Utilities.

Tata Power's Quality Control teams won 20 awards —10 gold, 7 silver and 3 bronze in Quality Circle Forum of India.

Tata Power Club Enerji was bestowed with the Asian Leadership Award 2011. Also, the initiative was conferred with an international recognition in the category of environmental leadership and best practice in corporate social responsibility.

Tata Power's wholly-owned subsidiary Coastal Gujarat Power achieved 'Strong Commitment to HR Excellence' level of recognition in the 2nd CII National Excellence Awards.

Tata Power's Trombay Thermal Power Station was bestowed 'Greentech Gold Award' for Excellence in Environment Management.