State-owned NTPC reported a 7.4 per cent year-on-year (y-o-y) increase in its standalone net profit to Rs 3,504.8 crore in the three months ended September mainly on lower tax expenses.
NTPC paid Rs 509 crore in taxes during the quarter, about 54 per cent lower than the same period last year. Lower taxes also offset the adverse impact of the Rs 560.4-crore rebate it offered to state-run power distribution companies under the direction of the Union power ministry due to the coronavirus crisis.
NTPC revenue increased 9.9 per cent to Rs 26,023 crore in Q2 as the power company sold 62.9 billion units of electricity in the period, 10.7 per cent higher than the corresponding period last fiscal. NTPC’s EBITDA (earnings before interest, tax, depreciation and amortization) was Rs 7,183 crore, lower than analysts’ expectations, mainly on higher other expenses.
The company’s board also approved a buyback of up to 19.79 crore equity shares at Rs 115 for an amount up to Rs 2,275.75 crore as part of capital restructuring.
NTPC coal stations’ average plant availability factor (PAF) improved 775 basis points y-o-y to 91.8 per cent on higher coal receipt, which lowered its fixed cost under-recoveries. Fixed cost represents pre-determined expenditure components, including debt service obligation and risk-free returns. Power plants are contractually entitled to receive fixed costs even when buyers do not procure electricity from the units. However, the plants need to display a minimum PAF of 85 per cent to claim the fixed costs.
NTPC’s power plants received 38.5 million tonnes coal, 4.6 per cent more than what was supplied in Q2FY20. While its own newly commissioned captive mines produced only 0.8 million tonnes of the fuel in the quarter, thanks to better supply from Coal India, NTPC’s coal imports also fell 76 per cent y-o-y to 0.2 million tonnes in the quarter.