Discoms' losses shrink but debt remains high and liquidity crunch widens

Latest PFC report on Discoms' Health in 2021-22 shows progress on AT&C and payment disbursals

Power distribution companies (discoms) continue to face high debt levels, despite a reduction in their booked losses. Of these companies, the financially-beleaguered state-owned discoms are facing a liquidity crunch and reduced capital expenditure by their state departments, revealed the latest Annual Integrated Ranking and Rating report by Power Finance Corporation (PFC).

For the reported year 2021-22, discoms' current liabilities exceeded their overall current assets, and amounted to nearly twice the value of their current liquid assets. The sector’s liquidity gap stands at Rs 3.03 trillion, said the report, adding that the combined liquid assets of discoms are adequate to cover