Tata Power on Wednesday reported 66 per cent drop in consolidated net profit for the June quarter at Rs 145.93 crore driven down by lower profits from its coal subsidiaries.
However, on a standalone basis, Tata Power's net rose 11 per cent to Rs 312.30 crore during the quarter as against Rs 281.56 crore, while its total sales stood at Rs 2,284.10 crore, up 19 per cent compared to Rs 1,921.24 crore in the same period previous fiscal.
"The decline in the consolidated net profit is mainly due to lower profit in coal companies owing to lower price realisation due to global economic slowdown and higher cost of production of coal," Tata Power managing director Anil Sardana told reporters.
Besides this, higher interest and depreciation cost due to commissioning of the Mundra and Maithon units pulled down the profits, Sardana said here this evening. Its consolidated revenues, however, grew 24.54 per cent to Rs 7,253.89 crore from Rs 5,824.51 crore a year ago.
On the rise in standalone net income, Sardana said, "the growth in profits represents strong operational performance during the period. This growth is in spite of the reversal of revenues due to changes in effective date of multi-year tariff (MYT) regulations in Mumbai impacting profits to the tune of Rs 155 crore."
The current capacity of the company stands at over 6,000 mw. During the reporting period, the company generated 4,259 million units and sold 4,227 million units.
The company had set a target of commissioning around 3,200 mw this fiscal, out of which it has already commissioned 800 mw by going on stream the second unit of the Mundra UMPP and the 525-mw-second unit of the Maithon Power plant Jharkhand in July.
"We will be commissioning some units of Mundra and a few more wind projects this fiscal," executive director S. Ramakrishnan said. During the quarter, Tata Power had signed a long-term coal supply agreement with PT Antang Gunung Meratus, a 100 per cent subsidiary of the Indonesian company PT Baramulti Sukses Sarana.
Further, to secure the coal supplies, the company, through its 100 per cent subsidiary Khopoli Investments, has also entered into an agreement which gives the latter an option, subject to necessary approvals, to take up to a 26 per cent stake in BSSR. AGM and BSSR own approximately 1 billion tonne coal resources in south and east Kalimantan in Indonesia.
"By signing this agreement with PT Antang Gunung Meratus, we have taken proactive steps to ensure imported coal supply for our upcoming power projects to be developed for next five years," Sardana added. He further said the company continues to look at international markets that offer a greater potential for growth.
"We are actively pursuing opportunities in other countries and hope to increase our global footprint in the coming years. Besides this, we are also scouting for coal mines in other countries," he said.