Adani Power loss narrows to Rs 1,180 cr in Q3 as PLF improves

Despite improved plant load factor (PLF), higher billed availability and better merchant realisations, Adani Power has posted a net loss of Rs 1,180.78 crore in the quarter ended December 2018. During the corresponding quarter, last fiscal, the Ahmedabad-based company's net loss was Rs 1,303.24 crore.

During the third quarter ending on December 31, 2018, Adani Power's consolidated income increased by 36%. In Q3 FY19, the consolidated total income earned was Rs 6,667 crore as compared to Rs 4,916 crore YoY.

The total expenditure increased by 20.61% to Rs 7,507.61 crore in Q3 FY19 from Rs 6,223.58 crore in Q3 FY18.

"This growth was due to improved PLFs, higher billed availability and better merchant realisations," read company's result statement.

The average PLF achieved during the Q3 FY19 was 73% as compared to 58% achieved in Q3 FY18. Likewise, even the overall billed availability significantly improved during Q3 FY19 at 80% as against 62% during Q3 FY18.

Commenting on the results, Gautam Adani, chairman, Adani Group said, "We are witnessing rapid progress in the resolution of regulatory issues that have affected cash flows of our projects in the past. We hope to see timely approval of supplementary power purchase agreements (PPAs) by the central electricity regulatory commission, which will help the Mundra power plant to operate sustainably. We have also received a substantial amount of compensatory payments under change in law for domestic coal shortfall, for the Tiroda and Kawai power plants."

"We continue to see a long term growth potential in the thermal power sector, which is bolstered by robust economic growth and the government's fruitful efforts in addressing the challenges faced by the sector," said Adani in a statement.

The result note stated that during Q3 FY19, Adani Power Mundra Ltd has accounted for delayed payment interest for power supply of Rs 125 crore for the period March 2011 to July 2018. However, Adani Power Mundra Ltd is entitled to delayed payment interest as per the PPA with Gujarat Urja Vikas Nigam Ltd.

For the same Mundra Power Plant, during the quarter, the company has recognised income of Rs 56.50 crore relating to the earlier years for carrying cost benefit made with Gujarat and Haryana Discoms. This amount is only a part payment made by Gujarat discom during the quarter.

Additionally, the company is expecting a favourable outcome from the ongoing petition being heard at CERC. As the company expects a "favourable outcome" and their own assessment states the recoverable amount of Adani Power Mundra Ltd's power generation assets of Rs 20,504.87 crore…the company is hopeful "to establish profitable operations and meet its liabilities…hence, no provision adjustment to the carrying value…" has been made during Q3 FY2019.

CHANGING FORTUNES

• 73% – Average plant load factor achieved in the quarter ended December 2018
   
• 80% – improvement in overall billed availability 
   
• 20.6% – Increase in expenditure for Q3FY19