Indian Energy Exchange (IEX) Q4 16/17 earnings summary

Executive summary

• FY17 operating income was Rs. 2,039.13 million and profit after tax was Rs. 1,133.16 million; the power exchange maintained its market leadership.

• Day-Ahead Market (DAM) cleared volume increased, while higher sell-side liquidity contributed to a lower average market clearing price.

Financial highlights

• Total income rose to Rs. 2,374.76 million from Rs. 2,001.40 million in FY16; operating income was Rs. 2,039.13 million versus Rs. 1,750.28 million.

• Profit before tax was Rs. 1,732.58 million versus Rs. 1,466.23 million; profit after tax was Rs. 1,133.16 million versus Rs. 1,001.32 million.

• Total expenses increased to Rs. 642.18 million from Rs. 535.17 million, including technology expenses of Rs. 234.24 million and other operating expenses of Rs. 216.28 million.

• Net cash generated from operations was Rs. 2,059.52 million versus Rs. 886.21 million; cash and cash equivalents ended FY17 at Rs. 816.32 million.

Outlook and guidance

• Surplus generation capacity and increased coal availability were expected to support sell volumes; this supply-demand backdrop was expected to continue over the next 4–5 years.

• FY18 market growth expectations included greater exchange liquidity, cross-border term-ahead trade, green DAM contracts, ESCert trading and improved transmission availability.

• Maintaining market leadership and developing the power market remained priorities; the outlook also cited fewer congestion, curtailment and market-splitting instances.

• Regulatory consent had been received to trade ESCerts; an application was pending for separate solar and non-solar Green-DAM contracts.