Adani Power swings to Rs 634.6-crore profit in Q4

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New Delhi | Published: May 30, 2019 4:26:00 AM

Adani Power reported a profit of Rs 634.6 crore on a consolidated basis for the quarter ended March 31

adani, adani power, adani power limitedEarnings before interest, tax, depreciation and amortisation (Ebitda) rose 39% to Rs 1,964 crore in the quarter but Ebitda margins decreased by 632 basis points y-o-y to 29.2%.

Adani Power reported a profit of Rs 634.6 crore on a consolidated basis for the quarter ended March 31, against a loss of Rs 634.3 crore in the corresponding period last fiscal as capacity utilisation (PLF) of its power plants doubled to 79% on improved coal supply.

Buoyed by regulatory approvals for substantial compensatory payments against previous domestic coal shortfalls and fuel-cost under-recoveries at its Mundra, Tiroda and Kawai power plants, the company’s revenue went up by 94% year-on-year (y-o-y) to Rs 8,077.9 crore.

Total income in the quarter included a relief of Rs 711 crore which the company recognised after the Central Electricity Regulatory Commission (CERC) allowed the Gujarat government to revise its power purchase agreement (PPA) with the imported coal-based power plant.

The supplemental PPA for 2,434 MW is effective retrospectively from October 15, 2018. The revenue also includes `975 crore recognised against favourable “change in law” and “force majeure” judgements to compensate for coal shortages in its 3,300 MW Tiroda power plant.

Earnings before interest, tax, depreciation and amortisation (Ebitda) rose 39% to Rs 1,964 crore in the quarter but Ebitda margins decreased by 632 basis points y-o-y to 29.2%.

The company recognised tax refund of Rs 718.8 crore in the quarter, compared with the Rs 3.2 crore tax refund it had recognised in Q4, FY18.

Fuel costs increased 134% y-o-y as the company sold 16.6 billion units (BU) of electricity in the quarter as compared to 7.9 BU in the corresponding quarter in the previous year.

Commenting on the company’s performance, Gautam Adani, chairman, Adani Power, said, “Recent months have seen a veritable transformation in India’s electricity sector regulation, which will go a long way in restoring the financial robustness of private sector power plants, and supporting economic growth through reliable and affordable power supply to the end consumers”.

Adani Power was the first to benefit from the Supreme Court’s October 29, 2018, ruling that extended the lifeline to the three troubled imported-coal-based power plants in Gujarat (Tata Power’s Mundra unit and Essar’s Salaya plant are the other two) by allowing the CERC to amend their PPAs to facilitate pass-through of future fuel price escalation, subject to a ceiling.

Adani’s Mundra unit — which has a total capacity of 4,620 MW — has accumulated losses of about `10,789 crore as on March 31, 2019.

Further, its current liabilities (including `2,643.9 crore for related parties) exceed current assets by `3,347.6 crore and, based on the latest financial statements, the net worth of the unit has been completely eroded.

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