Tata Power on Tuesday posted a two-fold jump in its consolidated net profit to Rs 475crore in the January-March quarter compared to the year-ago period.
The company's consolidated net profit was Rs 172 crore in the quarter ended on March 31, 2019, a company statement said.
"PAT (profit after tax or net profit) was up 177 percent at Rs 475 crore as against Rs 172 crore due to gain on sale of Cennergi investment offset by impairment provision in SED & reversal of MAT Credit due to transition to new tax regime in the renewables business," the company explained in the statement.
Tata Power's consolidated revenue stood atRs 6,881 crore as compared to Rs 7,597 crore in the corresponding quarter last year mainly due to delay in project execution in solar EPC (engineering procurement and construction) business on account of COVID19, lower power demand and lower coal price, it said.
"Tata Power Group's FY'20 revenue stood atRs 28,948 crore as compared to Rs 29,984 crore last year mainly due to lower power demand, delay in project execution in solar EPC business on account of COVID 19 and lower coal prices", it added.
The consolidated net profit stood atRs 1,316.44 crore in 2019-20 as againstRs 2,605.66 crore in the previous fiscal year.
The board has declared a dividend of Rs1.55 per share.
Commenting on the performance, Praveer Sinha, CEO & MD, Tata Power said in the statement, "All our businesses and operations have performed exceptionally well. Our robust performance is supported by excellent performance of renewable business & capacity addition."
About impact of lockdown, he said, "We are witnessing a drop in demand by almost 30 per cent compared to 2019 in our distribution businesses. Though thisimpacts our topline, almost all Tata Power's assets are under either regulated businesses or through fixed price long term contracts on take or pay basis. Thus in our business, the return profile covers our fixed costs and provides us assured returns."
"The company's divestment plans remain on track with a closure of the Cennergi transaction earlier in April with Rs 842 crore realised from this sale including hedging gain."
The company is in advanced discussions to execute sale agreement for another overseas asset, he said.
In addition, there is good progresson closing the sale of defence business in this quarter.
"Thedivestment in Zambia hydro project is also expected to be completed by December. The company is confident of meeting their divestment target this year. The restructuring of Renewable businesses including setting up the vehicle for their growth is well on track to closure.
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