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Adani Power
Adani Power

Adani Power swings back to profit

  • Favourable decisions from state electricity commissions have led Adani Power to swing back into profit
  • The Mundra plant also recognized other income of 217.75 crore on account of carrying cost for change-in-law due to shortfall in domestic coal

Favourable decisions from state electricity commissions have led Adani Power to swing back into profit to the end of FY19. These include decisions from regulatory commissions of Maharashtra, Gujarat and Rajasthan that approved change-in-law claims that affected coal supply to its plants.

During the March quarter, Adani Power (Mundra) Limited, the ultra mega power coal project, renegotiated power purchase agreements (PPAs) for 2434 MW capacity with Gujarat Urja Vikas Nigam Limited, the state discom, which have been approved by Central Electricity Regulatory Commission. The effect of Supplemental Agreement in terms of additional revenue of 711.28 crores was considered in the results for the quarter. The plant also recognized other income of 61.48 crore backed by an order from the Appellate Tribunal for Electricity for the award of carrying cost benefit on approved change-in-law claims such as Clean Energy Cess, Compensation Cess, Countervailing Duty, Integrated Goods and Service Tax and Basic Custom Duty, during the year based on submissions of carrying cost claims made with Gujarat Discom (distribution companies) and Haryana Discoms. Out of the said amount, Haryana Discoms have made full payment and Gujarat Discom has made payment of significant portion of the claim amount, the company said in notes to its March quarter financial results.

Based on the order of the Central Electricity Regulatory Commission, the Mundra plant also recognized other income of 217.75 crore (including 216.58 crore pertaining to earlier years) on account of carrying cost for change-in-law due to shortfall in domestic coal.

Adani’s Tiroda power plant benefited from an order by the Maharashtra Electricity Regulatory Commission for change-in-law claims on account of shortage of coal supply under the New Coal Distribution Policy upto 31 st March, 2017. The plant accounted estimated income of 1685.12 crore against such claims including revision made based on the said order in earlier financial years. It also recognized other income of 131.69 crore during Q4 based on the submission of carrying cost claim made with Maharashtra Discom, which has been fully recovered.

The Rajasthan Electricity Regulatory Commission has granted relief for the additional cost incurred on procurement of alternate coal whereby, Adani Power Rajasthan (Kawai) accounted for the claim receivable on account of NCDP policy of the government, against which the company received 2,351.14 crore during the year.

Adani Power has a thermal power generation installed capacity of 10,440 MW spread across four power plants in Gujarat, Maharashtra, Karnataka and Rajasthan, apart from a 40 MW solar power plant in Gujarat. The company, which houses the Gautam Adani group’s thermal and renewable energy generation, reported net profit of 634.64 crore for the March quarter, as opposed to the loss of 653.25 crore that it reported in the previous year. For FY19, net loss stood at 984.4 crore, lower than the 2073.77 crore it reported in FY18.

Average plant load factor (PLF) more than doubled to 79% in Q4FY19, against 37% in Q4FY18 while units sold during Q4FY19 more than doubled to 16.6 billion units from 7.9 billion units in previous year. Consolidated total income stood at Rs. 8,078 crore for the quarter as compared to Rs. 4,161 crore in Q4FY18, an increase of 94%, while consolidated EBIDTA for Q4FY19 was at 1,964 crore vs Rs. 1,414 crore in Q4FY18 – an increase of 39%.

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