Torrent Power (TORNTPOWER) Q4 12/13 earnings summary

Executive summary

• FY 2012-13 revenue rose 3.12% to ₹8,269.97 crore, while PBDIT fell 38.94% and PAT fell 68.89%, reflecting domestic gas shortages, costly LNG, lower CER income and deferred recovery of power-purchase costs.

• Lower gas availability cut SUGEN output and reduced overall power sales; distribution volumes grew in Ahmedabad-Surat, Bhiwandi and Agra, while Ahmedabad-Surat T&D losses improved.

• UNOSUGEN’s 382.5 MW expansion entered commercial operation on 4 April 2013; DGEN and other projects faced delays, cost pressures or approval constraints.

Financial highlights

• Standalone revenue from operations was ₹8,129.87 crore versus ₹7,915.61 crore; total revenue was ₹8,269.97 crore versus ₹8,019.66 crore.

• Standalone PBDIT was ₹1,439.15 crore versus ₹2,357.10 crore; PBT ₹622.74 crore versus ₹1,679.25 crore; PAT ₹384.96 crore versus ₹1,237.46 crore.

• Consolidated total revenue was ₹8,364.53 crore versus ₹8,063.10 crore; profit after tax and minority interest was ₹386.70 crore versus ₹1,252.59 crore.

• CER income was ₹44.99 crore versus ₹324.99 crore; 0.77 million CERs were sold during the year, while CER prices fell from ~€3.77 in March 2012 to ~€0.32 in March 2013.

Outlook and guidance

• DGEN’s 1,200 MW project was expected to complete in Q4 FY 2013-14, with revised project cost anticipated from additional works, foreign-exchange variation and commissioning requirements.

• The 75 MW Bhud wind project was expected to commission by February 2014, subject to forest clearance.

• Agra operations were expected to improve in FY 2013-14 through network upgrades, undergrounding, improved meter reading and collection efficiency.

• Potential sector support included domestic gas allocation and pricing measures, coal-block reallocation, tariff revisions and debt restructuring for state distribution utilities.