The net profit of Sajjan Jindal-promoted JSW Energy rose 7 per cent in the quarter ended June 30, 2019, on the back of better performance. The company has also terminated its agreement to buy Jindal Steel and Power’s Chhattisgarh power plant and has initiated discussions for repayment.
After shelving its plans to manufacture electric vehicles, earlier this year, JSW Energy now looks to focus on developing solar power projects.
For the quarter under review, JSW Energy reported a net profit of Rs 244.38 crore, against Rs 229.17 crore in the same period a year ago. “Power demand is back to 6.7 per cent level, and we expect it is likely to grow in the same 6 to 7 per cent range,” said Sharad Mahendra, chief operating officer (COO) of JSW Energy. He added, "June quarter was a steady quarter for JSW Energy, Ebitda margins have been maintained.” Earnings before interest, taxation, depreciation and ammortisation (EBITDA) was at Rs 861 crore, against Rs 844 crore in the same period a year ago.
The company said its long-stop date for a purchase agreement with Jindal Steel and Power (JSPL) to acquire its Chhattisgarh power plant expired last month. “The agreement now stands terminated and we have started discussions to make a repayment arrangement,” said a company official. JSW Energy entered into an agreement to buy the 1000 MW plant from JSPL in 2016. As part of the agreement, JSW also extended a soft loan to the company, which at present, stands at around Rs 330 crore as amount due.
The company also plans to revisit its plans for the solar energy segment. “We will start bidding for solar projects in this financial year, to have a reasonable capacity operational by next financial year,” Mahendra said. The company had earlier placed plans for solar energy on the back-burner citing aggressive bidding and higher competition as the reason. “Solar space is now seeing fewer players, with states like Maharashtra receiving just one bid (JSW),” he said. The company is planning to target a capacity of 200-300 MW capacity in the solar energy space as a developer by the next financial year. JSW Energy currently operates 10 MW of solar energy capacity, which is capitve to the group.
The company will also participate in the fresh call of bids for Ind Barath Energy (Utkal), a subsidiary of Ind Barath Power Infra.