NTPC profits continue to slide, income dips by 5%

Declining PLF and demand hurt bottom-line

State-owned NTPC registered an annual profit of Rs 10,243 crore during 2015-16, showing a mild decline from the previous year’s figure of Rs 10,291 crore.

The company, a leading power producer, has been posting decline in profit for the past three years now.

The audited total income for FY16 stood at Rs 71,696 crore, 4.8 per cent lower than that of FY15.

During FY16, NTPC recorded the highest ever generation of 242 billion units against 241 billion units in FY15. Company executives, however, said NTPC could not generate 20 per cent of its total generation capacity owing to lack of demand.

NTPC witnessed a decline in its plant load factor (PLF) or the utilisation ratio of power generation unit at 78.6 per cent in FY16, which is lower than its PLF of 80.2 a year ago.

According to company officials, the miscellaneous costs for NTPC have gone up. These include expenditure on corporate social responsibility, which doubled in a year to Rs 500 crore in 2015-16.

The new emission norms stipulated by the government for thermal power plants to meet climate change targets are also likely to hit the capital expenditure of NTPC.

According to senior officials, the cost of power production would increase by Rs 50 lakh per Mw. The current cost of power production is Rs 5 crore per MW – an average increase of 10 per cent.

With the improvement in coal supply and availability, NTPC’s average energy cost came down by 13 per cent in the last quarter.

“This benefit was passed on to the consumer. We continue to recover the fixed cost from our procurers, variable cost, which is a function of the demand, continues to face hiccups,” said a senior director requesting anonymity.

For the quarter ending March 2016, NTPC’s profit registered a 13 per cent growth over the year-ago period to Rs 2,716 crore.

The unaudited total income during the same period was Rs 18,561 crore, declining by 7.7 per cent from the fourth quarter of FY15.