The Hindu Business Line : Changes in accounting pattern, write-offs tell on NHPC

Growth plans
NHPC to raise funds from overseas, domestic markets to fund investment
May come out with IPO later this year
Poised to become 10,000 MW plus company by 2012

Mr S.K. Garg, CMD, NHPC; flanked by Mr S.P. Sen (right), Director Technical; and Mr S.K. Chaturvedi, Director, HR, in the Capital on Thursday. — Kamal Narang

New Delhi , April 13

National Hydroelectric Power Corporation (NHPC) today announced a marginal increase in the net profit during the last fiscal at Rs 701 crore, up 2.3 per cent over the net profit of Rs 685 crore recorded in 2004-05. The company has achieved a turnover of Rs 1,834 crore in 2005-06, compared with 1,668 crore in previous fiscal.

Announcing the provisional results for the last fiscal, the Chairman and Managing Director of NHPC, Mr S.K. Garg, today said the net profit could have been much higher at around Rs 800 crore, but for certain write-offs done during the last fiscal. NHPC had to write-off Rs 52 crore incurred on the proposed Koelkaro project. Besides this, changes in the accounting pattern also hit profits to the tune of around Rs 33 crore, while payment of arrears to employees due to salary revision dented profit by another Rs 25 crore, he added.

He said that NHPC would be investing Rs 60,000 crore during the Tenth and Eleventh Five Year Plans and the funds would be raised from both overseas and domestic markets. The company may also come out with an initial public offer later this year or by early next year.

"The Ministry of Power has asked us to work on the IPO... we have taken an initiative and if all goes well we shall hit the capital market this year itself." He, however, declined to elaborate on issues such as size of the IPO and other related details saying the process has just begun and it would take some time to finalise details.

Capacity expansion

"NHPC is in the process of raising $100 million (about Rs 450 crore) through external commercial agreement route for part-financing the Subansiri lower project," Mr Garg said. NHPC has already added 1,580 MW capacity during the first three years of Tenth Plan period and would be adding another 900 MW in the remaining years to achieve the target of 2,480 MW, Mr Garg said. "NHPC is poised to become 10,000 MW plus company by the end of 2012," he said.

Mr Garg said the company is all set to generate internal resources to partly finance funds for Plan outlay requirements in the future. He said the corporation was poised to liquidate all general purpose loans during the current financial year.