BackR-Infra, R-Power post marginal rise in Sep quarter profit
R-Infra's net profit rose to Rs431.19 crore from Rs426.60 crore, while R-Power's net profit rose to Rs253 crore from Rs250.5 crore a year ago
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Mumbai: Reliance Infrastructure Ltd (R-Infra), the infrastructure arm of the Anil Ambani-led Reliance Group, posted a marginal increase of 1% in profit for the three months ended 30 September.
Another group company, Reliance Power Ltd (R-Power), also reported a marginal increase of 1% in its net profit for the reporting quarter. For R-Power, higher interest costs and a lower non-operating income dented profit growth.
R-Infra’s net profit rose to ₹ 431.19 crore from ₹ 426.60 crore a year ago. However, total operating revenue fell 18% to ₹ 4,057.95 crore from ₹ 4,977.28 crore a year ago. A company press release did not state any reason for the rise in profit. A Bloomberg poll of earnings estimates pegged R-Infra’s net profit at ₹ 457 crore and net sales at ₹ 4,016.2 crore.
As of 30 September 2014, the consolidated net worth of the company stood at ₹ 28,040 crore, it said in a statement.
The company posted a 7% year-on-year decline in revenue from the power business to ₹ 3,277 crore for the quarter, while it registered a 65% drop in the engineering, procurement and construction (EPC) and contract business at ₹ 576.78 crore. The power business recovered arrears of ₹ 221 crore in Mumbai during the quarter and added 19,000 new consumers. The Delhi power distribution business recovered around ₹ 2,100 crore of arrears including carrying cost, R-Infra said.
The EPC business had an order book of ₹ 6,106 crore as of 30 September.
The infrastructure business reported a 24% rise to ₹ 215.17 crore. The company’s cement business posted a 116% growth in revenue to ₹ 31 crore for the reporting quarter. Reliance Cement has been launched in six states with a capacity of 5.8 million tonne per annum.
The Mumbai Metro project made a loss of ₹ 57 crore during the quarter. For the Metro project, the retail and advertisement agreements for non-fare box revenue are fully tied up, the company said in the statement.
Analysts said that the companies’ performance in the quarter was not indicative of a definitive revival.
“With this kind of a flat rise in profit, it is difficult to say when will these companies recover and take off," said an independent equity analyst based in Mumbai. He requested anonymity.
The results were announced after market hours.
Shares of R-Infra lost 0.99% to close at ₹ 636.95 on Wednesday on BSE, while the benchmark Sensex gained 0.35% to close at 28,008.90 points.
R-Power’s net profit in the June-September quarter rose to ₹ 253 crore from ₹ 250.5 crore a year ago. Revenue increased 35% to ₹ 1,783.24 crore.
According to a Bloomberg poll of 11 analysts, the company had been expected to post a revenue of ₹ 1,700.5 crore and a net profit of ₹ 231.9 crore for the September quarter.
The company reported lower other income, or income from revenue streams other than its main operations, of ₹ 101 crore, compared with ₹ 136 crore a year ago. Also, interest expense for the quarter (as a percentage of revenue) increased to 14% from 12.5% a year ago.
The fifth unit of 660 megawatts (MW) at the firm’s 3,960MW Sasan project became operational during the quarter, the company said, adding that it expects to reach full capacity at the plant by the end of the fiscal. R-Power’s 100MW concentrated solar power plant in Rajasthan also began generating power in the quarter.
On Wednesday, R-Power shares ended at ₹ 74.55 on the BSE, down 1.5% from the previous close.
Reliance Power has sued HT Media Ltd, publisher of Mint, in the Bombay high court over a 12 May front-page story in Mint that it disputed. HT Media is contesting the case.
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