R-Infra, R-Power post weak fourth quarter results

While Reliance Infrastructure reported a 14% dip in net profit Reliance Power posted a net profit of Rs 268 crore

Anil Ambani-led Reliance Infrastructure (R-Infra) and Reliance Power (R-Power) reported weak fourth-quarter results on Monday. While R-Infra, with metro rail lines, cement plants and roads under it, reported 14 per cent dip in net profit versus a year ago. R-Power had a near flat profit.

R-Infra’s profit fell to Rs 621 crore versus Rs 721 crore a year ago due to lower revenue. Revenue dipped to Rs 4,708 crore versus Rs 6,187 crore a year ago due to lower income from from engineering, procurement and construction (EPC).

R-Power posted a profit of Rs 268 crore versus Rs 266 crore a year ago despite an increase in revenue. Income rose to Rs 1,399 crore versus Rs 1,264 crore a year ago.

R-Infra Chief Executive Lalit Jalan said income from EPC contracted because the ongoing projects were completed and there was no new work. A majority of its EPC works have been secured from group company R-Power and now R-Infra is looking for EPC projects in road and power in India and abroad.

Jalan said R-Infra would open Mumbai Metro’s first phase in the first quarter. He added only the final sanction was awaited from the government and the company was prepared to open it in ten days. Revenue-wise, 2014-15 would be better as all its under-construction projects in road, power transmission and cement would be operational this year, he said, adding the company would have a capital expenditure of Rs 1,500 crore this year. The company has been able to win back all its industrial consumers it had lost to Tata Power in Mumbai.

He added the change of guard in Delhi should kickstart economic growth. “We feel enthused now,” he said. Jalan said the efforts initiated during the last few months of the United Progressive Alliance government to revive infrastructure projects should get a boost now. Infrastructure would have to be improved if India is to achieve high GDP and generate employment.

Jalan said the company was committed to pay Rs 700 crore in pending dues to the National Thermal Power Corporation as mandated by the Supreme Court by May-end. “We are working to abide by the Supreme Court order. We are in discussions with banks to raise the amount. Plus, there are normal collections. There will be no load shedding in Delhi,” he said.

Earlier this month, the Supreme Court had said that NTPC could cut supplies to RInfra-run BSES in Delhi if the latter failed to clear arrears of dues for the current year by May 31.