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Analyst Meet / AGM - Analyst Meet

Short-term volume outlook remains uncertain for next couple of quarters

PTC India

02-Jun-2015, 10:11
The company held its analyst meet on 2^nd June 2015 and was addressed by Mr. Deepak Amitabh MD

Key highlights

Total volume traded in FY'15 stood at 37137 MUs, up by 6% YoY. Short term volume traded stood at 20805 MUs, down by 3% YoY while long term and Medium term volumes grew by 20% and 17% to 14674 MUs and 1645 MUs respectively.

Long term volume stands at around 40% of total overall power traded volumes. Management expects the share of long term to go to upwards of 50% in next couple of years.

For Q4 FY'15, the total volume traded stood at 6331 MUs, down by 17% YoY. Short term volume traded stood at 3750 MUs down by 28% YoY while Long term volumes stood at 2138 MUs, up by 21% YoY.

The company saw severe Grid constraints and lower volume off takes from SEB's in FY'15. Nearly, 60% of contracted short term power could not flow in FY'15. Management expects the phenomena to continue for couple of more quarters and then some clarity will emerge on short term trading.

There is a mismatch between transmission capacities and generation capacity both existing and the new capacities that are coming up. For example in Jaipur and in States of Kerala, Tamil Nadu, Transmission lines are not completed due to environmental issues and new generation capacities are already ready. Further due to Grid collapse issues in 2013, Grid are behaving very cautiously and are not ready to load additional power in inter grid connectivity.

The company has won the arbitration of the remaining Rs 220 crore to be received from TNSEB. Management expects the same to be received in July'15. Management is confident of good surcharge income also to be received before Mar'16 from TNSEB. .

Medium term power largely related to trading of power with Nepal, Bangladesh and other neighboring countries. The demand was lower in FY'15. Both Nepal and Bhutan are expecting generation capacities to come up in FY'16 thus the inter regional power trading once again will pick up in FY'16 with these neighboring countries.

Long term power supply trading margin is not capped by CERC. Realization for long term power is better than short term. The margins hover around 7-8 paise on an annualized basis. Of the 11500 MW long term contracts, more than 7500 MW are tied up by PTC India.

So overall, while short term outlook remains uncertain, there is a good visibility on long term.