PGCIL’s tax expenses recorded a 44.2% fall to Rs 755.5 crore, contributing to higher profit.
Power Grid Corporation of India (PGCIL), the central transmission utility of the country, recorded a 9.4% year-on-year (y-o-y) rise in net profit to Rs 2,527.1 crore on a standalone basis for the quarter ended September 30, as revenue from power transmission — its main business segment — grew 4.2% y-o-y to Rs 8,497.6 crore.
PGCIL’s tax expenses recorded a 44.2% fall to Rs 755.5 crore, contributing to higher profit. Earnings before interest taxes, depreciation and amortisation (Ebitda) were up 8.3% to Rs 7,556.8 crore in the quarter from the same period a year ago as its ‘other expenses’ fell nearly 25% to Rs 643.5 crore.
“Powergrid reported weak set Q2FY20 results wherein core transmission segment revenues posted low single digit revenue growth, which impacted absolute Ebitda and core profitability front,” ICICI Securities said.
The company said that revenue from the transmission segment decreased by Rs 297.4 crore due to change in minimum alternate tax (MAT) from 18.5% to 15%. MAT is considered for grossing up of return on equity according to the regulations by the Central Electricity Regulatory Commission. The company operates 1.6 lakh circuit km of transmission lines. The company was recently given ‘Maharatna’ status by the Centre.