High fuel costs may lead to tariff hike, growth expected to touch pre-Covid levels: CESC
1 min read . Updated: 29 Jul 2022, 06:44 PM IST
Premium- CESC Chairman Sanjiv Goenka said on Friday that the company is expected to post similar growth witnessed in the pre-Covid period during this financial year
Power utility company CESC on Friday said that it could look at hiking tariffs in the wake of high fuel costs. CESC Chairman Sanjiv Goenka said on Friday that the company is expected to post similar growth witnessed in the pre-Covid period during this financial year.
"Input prices have been increasing… We have issues with costs, which are beyond our control, and at some point in time those will be reflected," Goenka said at CESC’s 44th annual general meeting held virtually, according to news agency PTI report. “Though the company is still not back to the pre-Covid levels (in terms of growth) as on March 31, 2022, but this year, hopefully we should," he said.
Additionally, Goenka pointed out that the Kolkata-based power utility was one of the few companies that could manage the coal crisis without many glitches. The Centre has allowed import of coal for up to 10 per cent blending purposes and CESC will go ahead with its plans as per the government order, he added. In its annual report for 2021-22, Goenka had said fuel cost is a short-to-medium-term constraint, and it is vital that power producers and distributors are able to expeditiously pass on purely the element of higher fuel cost through tariffs, according to PTI report.
To a question about inorganic growth, he said, "We are always open to the idea of growth, and we will examine every worthy opportunity that comes our way." He also said the Chandigarh distribution is likely to be handed over to the company soon. It had recently bagged its sixth distribution licensing area outside Kolkata in Chandigarh. The distribution licence will be valid for 25 years. Apart from Kolkata, CESC has distribution interests in Bharatpur, Bikaner, Greater Noida, Kota and Malegaon.
Meanwhile, earlier this month, the power utility firm said it will seek shareholders' nod to mortgage its immovable or movable properties for financial assistance and term loans of up to ₹1,900 crore. According to the notice for the AGM (Annual General Meeting) scheduled on July 29, the company will mortgage properties in favour of Bank of Baroda for a term loan of ₹300 crore; State Bank of India for a term loan of ₹300 crore and Union Bank of India for a term loan of ₹300 crore.
(With inputs from PTI)
