Reliance Infrastructure Ltd held a conference call to discuss growth plans.
Highlights
- The Company has Rs 9,898 crore (US$ 2.03 billion) of cash and cash equivalents. Of which more than Rs 5,000 crore (US$ 1.03 billion) cash is in debt mutual funds, without any exposure to equity markets.
- The Company has a debt of Rs 5,215 crore (US$ 1.1 billion) and remains debt free at the net level.
- As on December 31, 2008, the net worth of the company stood at Rs 11,847 crore (US$ 2.4 billion)
- The Margins for the EPC contracts were lower during the quarter review, since a few projects are under early stages of execution and have not reached the profit-booking threshold.
- The company has outstanding ECBs of US$760mn as of December 31, 2008, which the company has hedged with foreign currency denominated derivatives of US$700mn.
Energy Sales
The Company achieved aggregate sales of electrical energy of 7,357 million units during the nine months ended December 31, 2008, against 7,197 million units in the corresponding period of previous year, an increase of 2%.
The Company’s aggregate revenues from energy sales were Rs 5,730 crore (US$ 1.2 billion) compared to Rs 3,774 crore in the corresponding period of previous year, an increase of 52%.
During the last quarter, the customer base in Mumbai Supply area increased by 0.3 lakhs to 26.8 lakh customers inspite of the prevailing open access regime.
Power Generation
(i) Dahanu Thermal Power Station (DTPS)
During the period under review, the company’s Dahanu Thermal Power Station continues to operate at Plant Load Factor (PLF) of over 100%. The plant has maintained Heat Rate of 2304 Kcal/Kwh during period under review.
The Station generated 3,302 million units during the period against 3,336 million units generated during the corresponding previous period.
(ii) Samalkot Power Station, Andhra Pradesh
During the period under review, the Samalkot Power Station achieved a Plant Load Factor (PLF) of 51.7%, against the PLF of 62.6% achieved during the corresponding period of previous year due to non-availability of sufficient gas. The station generated 750 million units against 903 million units in the corresponding nine months of previous year.
As there would be sufficient availability of gas in near future, due to which, the PLF is expected to increase resulting in substantial positive impact on bottom line.
(iii) Goa Power Station
During the period under review, the Goa Power Station achieved a Plant Load Factor (PLF) of 84.1%, against the PLF of 83.2% achieved during the previous year. The station generated 242 million units against 239 million units in the corresponding nine months of previous year.
(iv) Windfarm Power Project
During the period under review, the wind farm achieved a Plant Load Factor (PLF) of 30.0%, against the PLF of 30.2% achieved during the corresponding period. During the period, the wind farm generated 18 million units against 19 million units in the corresponding nine months of previous year.
The Karnataka wind farm has got the carbon credit approved and has a credit of 71,000 Verified emission reductions (VERs) in its account.
Power Purchased
During the period under review, the company purchased 4,182 million units of electrical energy from external sources, which is higher by 9% compared to the corresponding period of previous year.
The cost of energy purchased increased by 80% to Rs 3,534 crore (US$ 726 million) during the period under review, primarily owing to exorbitant increase in per unit cost i.e. from Rs 5.11 per unit to Rs 8.44 per unit.
EPC Business
The division had a order book position of about Rs 21,510 crore (US$ 4.4 billion) as on December 31, 2008, as against Rs 8,300 crore in the corresponding nine months of previous year, an increase of over 159%.
The EPC division has manpower strength of over 1,500 as on December 31, 2008.
Currently working on multiple projects and implementing over 7,200 MW of power projects as:
- 2X600 MW of power project in Hisar, Haryana
- 6 X 660 MW Sasan UMPP by Reliance Power
- 2X600 MW Raghunathpur Thermal Power Project of Damodar Valley Corp., West Bengal
- 2X250 MW Parichha Thermal Power Station, Uttar Pradesh – BOP
- 1 X 300 MW Butibori Thermal Plant by Reliance Power – Awarded in this quarter
- Western Region System Strengthening (WRSS) transmission project
- Electrification of 6,715 villages under Uttar Pradesh rural electrification scheme – Almost completed
Transmission
Company is executing following transmission projects worth Rs 4,000 crore (US$ 821 million)
Western Region Strengthening Scheme (WRSS)
- Transmission Licenses have already been granted by CERC
- All power trading agreement has been finalized and to be signed shortly
- The process of appointing Lenders’ Engineer is underway and financial closure is expected to be achieved by Q4 FY09
- The projects is expected to be completed by Q3 FY 11
Parbati Koldam Transmission lines in HP (JV with PGCIL)
- Transmission Licenses have already been granted by CERC
- Financial Closure is expected to be achieved by Q1 FY10
- Company will shortly commence construction of the project
- The projects is expected to be completed by Q4 FY13
Mumbai Strengthing
- Received all regulatory approval
- Projects are under implementation and process of land acquisition is underway at different locations for these projects
- The projects is expected to be completed by Q4 FY12
In addition to the above, company is also participating in various transmission projects worth Rs 9000 crore (US$ 1.8 billion)
Energy Trading Business
The division has traded 1,253 million units in the nine months as compared to 633 million units in corresponding period of previous year, an increase of 98%. It has started operations through the First Energy Exchange of India (IEX) and traded 161 million units in the nine months ended December 31, 2008.
During the quarter, the division has signed 2 long term contracts for total capacity of 450 MW; it would provide assured trading of 60,000 million units over 25 years starting from 2011.
Infrastructure Business
The Company is implementing the following infrastructure projects:
Roads
Construction work is in full swing of all 5 road projects in Tamil Nadu worth Rs 3,150 crore (US$ 647 million)
Among these, 2 projects i.e. NK Toll & DS Toll is expected to start commercial operations in next quarter i.e Q4 FY09. Other 3 projects i.e TK Toll, TD Toll and SU Toll are scheduled to be completed in Q2 FY11.
During the last quarter, company submitted bids for 3 road projects worth Rs 7,000 crore (US$ 1.4 billion)
| S.No. | Project | Length in Km |
Concession Period |
Current Status |
| 1 | Gurgaon – Faridabad & Ballabgarh – Sohna Road projects |
66 | 17 years | LOI issued |
| 2 | Eastern Peripheral Expressway | 135 | 20 years | Emerged Sole bidder |
| 3 | Krishna – Walajpet project in south India |
150 | 30 years | Emerged L1 bidder |
Metro
Developing 2 metro rail projects in Mumbai and Delhi worth Rs 5,000 crore. The company is implementing both the MRTS projects awarded in India under Competitive bidding, by separate SPV’s named “Mumbai Metro One Private Limited” (MMOPL) and “Delhi Airport Metro Express Link Private Limited” (DAMEPL). The details of the projects are:
| Project | Length in Km |
Corridor | Concession Period |
| Mumbai Metro I | 12 | Versova – Andheri – Ghatkopar |
35 Years |
| Airport Metro | Express Line – Delhi | 23 New Delhi Railway Station | – IGI Airport – Dwarka |
* includes construction period
Some of the major mile stones achieved in Mumbai Metro are:
- Financial Closure for complete debt of Rs 1,200 crore (US$ 246 million) has been achieved in October 2008. IDBI Bank is the lead arranger for the loan. The company successfully raised debt amidst tight global liquidity position.
- All the critical & major contracts have been awarded and the project implementation is going on in full swing
- 80% of Right of Way (ROW) is in possession
- Foundation works for both viaduct and station works is going on in full fledged manner. Foundation works for Western Express Highway Special Bridge and the Mithi River Special Bridge has also commenced
- Project is expected to be commissioned 2 years before the contractual commissioning date
Some of the major mile stones achieved in Delhi Metro are:
- Major contracts like Rolling Stock, Signalling, Traction and Power supply has been awarded
- All Preliminary design and engineering work has been completed
- Civil structures for the project is provided by DMRC and construction has commenced
- Debt syndication is in progress and Axis Bank has been appointed as lead lender forloan syndication.
In addition to the above, company is also participating in Mumbai Metro Line 2 project. It will be constructed along CHARKOP-BANDRA-MANKHURD corridor. The line is 32 kms long and will consist of 27 stations enroute. Company is already technically qualified for the project.