Total income for the period was lower by 29% year on year at Rs 3,959 crore due to a lower plant load factor and lower billed availability of the power plants.
Adani Power’s consolidated net loss nearly doubled in the April-June quarter to Rs 824 crore compared to Rs 452 crore in the same quarter last year as plant utilisation halved on lower availability of domestic coal and higher cost of imported coal.
Total income for the period was lower by 29% year on year at Rs 3,959 crore due to a lower plant load factor (PLF) and lower billed availability of the power plants.
The PLF, which measures the utilisation of the given plants for the three months to June quarter, almost halved to 38% compared with 63% a year ago on account of lower availability of domestic coal at 1,330 mw Kawai power plant in Rajasthan and 3,300 mw Tiroda plant in Maharashtra. Both the plants are facing coal linkage issues for the past couple of quarters. The operations were also affected by commercial shutdowns due to higher cost of imported coal.
The consolidated earnings before interest, tax, depreciation and amortisation (EBITDA) were down 20% on year to Rs 1,288 crore on account of lower generation due to shutdowns and and non-availability of coal. The billed availability was also down to 42% during the quarter. The operating margins, however, rose by 400 basis points to 33% compared with 29% a year ago.
Similarly, the 4,620-mw Mundra power project in Gujarat is incurring operational losses due to lower plant load factor, higher cost of operations and significant finance costs. “The company’s management has approached the various stakeholders to arrive at alternative solutions to minimize the operating losses. The discussions in the matter are still at an exploratory stage. Based on the assessment of the recoverability of the carrying amount of assets of the said power plant and the company’s intention to financially support APMuL, no further adjustment is considered necessary at this stage,” the company said in earnings report report.
The company also expects that the completion of the insolvency resolution process for Korba West Power Plant through National Company Law Tribunal will result in recommencement of operation of the plant and in the process, enable them to recover the amount paid in advance for its acquisition.
“The pending Corporate Insolvency Resolution Process (CIRP) of KWPCL with NCLT, the company would continue to demand and expects to realise the value of advances given to the owners of KWPCL/ sale proceeds and advance paid to KWPCL and no impairment/provision needs to be recorded in the books,” the company said. Adani Power has paid around Rs 2,714 crore since March 2015 to the owners of the company, however, the final sale could not take place and the plant was not operational since then.
Gautam Adani, chairman of Adani Power, said in a statement, “We are enthused by rapid progress in regulatory outcomes that will help us get compensated for increase in the cost of generation. With the constitution of the high powered committee by the government of Gujarat. We are hopeful of finding a lasting and sustainable solution to the cost under-recovery issue of the Mundra power plant soon.”