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Analyst Meet / AGM - Analyst Meet

PTC India expects volume growth of 13-15% in FY 14 and PFS expects loan book to double in 15-18 months

PTC India and PTC India Financial Services

28-May-2013, 12:31
There was an Analyst Meet to discuss financials and update about the business of PTC India and PTC India Financial Services (PFS), on 27^th May'13 and was addressed by CMD of PTC India, Mr. Deepak Amitabh CMD, PFS.
Key highlights

India's peak power deficit continued to remain above 9% in FY'13. Country's total installed generation capacity stands at 2.23 lakh MW as on Mar'13. Capacity addition for 12^th 5 year plan is planned at 88 536 MW.

Total volume traded in short term power market in India stood at 99995 MU and PTC retains market share of around 40% in power trading. Trading volumes is increasing towards power exchanges and unscheduled interchange (UI) volumes is shifting to formal market mechanisms.

SEB health continues to remain a challenge and so as the fuel availability, for the Power sector. Management expects that while the reforms have already been started and trend is positive, it will take some more time before the whole scenario turns normal.

For FY'13, including the tolling volumes, total of 28597 MU of total volumes were traded, which is up by 17% y.o.y. Excluding tolling volume, which was at 952 MU as compared to Nil for FY'12, the trading volume grew by about 13% y.o.y.

In FY'13, short term trading volume stood around 60% of total volumes traded. The endeavor of the management is to increase the long-term volumes, which are more reliable and have higher margins as well. In next 2-3 years, with the long term capacities which were signed earlier are coming up, management expects the mix will change towards long term in terms of around 65% or 70% of total power trading will be long term in nature.

Outstanding from UP SEB remains around Rs 770 crore and from TN SEB, it is around Rs 360 crore as on Mar'13. Excluding the UP and Tamil Nadu, the outstanding days are less than 1. During Q1 FY'14, so far, about Rs 5 crore is received from UP and Rs 100 crore from TN SEB.

The surcharge income for FY'13 stood at Rs 12.50 crore as compared to Rs 27.20 crore for FY'12. Management expects the surcharge income to improve in FY'14 as the principal payment comes in, the company will go for surcharges.

PTC has total tolling capacity of 150 MW, which will increase in FY'14, as another 350 MW of capacity gets operational. Margin in Tolling business stood at 0.80 paise. South Indian market is doing very well for the company for tolling business.

Management expects trading volume growth of about 13-15% in FY'14. Margins to hover around 4 paise per unit, which is same as in FY'13. Overall, aim is to cross 40 MU in next 2-3 years.

For PTC India Financial Services (PFS), the company expects to double the loan book from Rs 2296 crore in next 15-18 months time. Of the total book outstanding of Rs 2296 crore, about 40% is towards renewable. Management has assured that while extra due diligence on a continuous basis is required for renewable projects, care has been taken regarding these projects and the company will continue to show Nil NPA's.

For FY'14, the yield on asset for PFS was lower and stood at 13.9% vis a vis 14.3% y.o.y, as there was a shift in composition of lending. The short term lending which was at 23% of total lending in FY'12 was down to 13% in FY'13 and short term had better yields.

For renewable, the company uses the ECB money to fund them, which costs, net of forex, about 6.5%.

For FY'14, management does not expect any exits from investments that it had made, as it will take time before these investments stabilize. But FY'15, for sure, exits will be made which will add value to the shareholders.

For improvement of RoE, management expects that to happen once the receivables improve and the equity investments by the company, gets cashed out. Teesta Urja, Sikkim plant and Athena Chhattisgarh plant will surely be ready to reap in FY'15.