Torrent Power Q2 PAT up 82% to Rs Rs 369 cr on electricity demand spike

The company's revenue from operations was up by 17% to Rs 3,648 crore in Q2FY22, from Rs 3,129 crore a year ago

A significant increase in electricity demand mainly in commercial and industrial customers has contributed to a rise of 82.44 per cent in Torrent Power's profit after tax (PAT) at Rs 368.84 crore for the quarter ended September 30, 2021. The company had posted a PAT of Rs 202.17 crore in the corresponding period last year.

The firm's revenue from operations was up 17 per cent to Rs 3,648 crore in Q2 of FY22, from Rs 3,129 crore a year ago.

Apart from increase in demand, other improvement drivers include reduction in T&D losses in the company's distribution franchisee business, and reduction in provision for doubtful debts in Distribution Franchisee business, which severely impacted the comparative quarter of last year due to Covid 19 pandemic.

Torrent Power also saw an increase in contribution from renewables generation, which was impacted in the comparative quarter of last year due to abnormally lower wind speed, apart from a decrease in interest cost, both due to lower debt and reduction in interest rates.

During the quarter, Torrent Power entered into a share purchase agreement with CESC Limited, Haldia Energy Limited and other Nominal Shareholders for the acquisition of 100 per cent of the share capital of Surya Vidyut Limited, which operates a 156 MW wind power plants, situated in the state of Gujarat, Rajasthan and Madhya Pradesh. Enterprise value estimated for this acquisition is approximately Rs 790 crore subject to closing price adjustments.

Long-term Power Purchase Agreements (PPAs) for the projects are with respective state discoms for a period of 25 years. The acquisition is subject to customary conditions for transaction closure.