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Increased generation, realisation improve sales of power companies

The findings were made in a study titled 'India's Leading Infrastructure Companies 2014' made by Dun & Bradstreet India

BS Reporter New Delhi
Last Updated : Nov 04 2014 | 5:07 PM IST
Increase in power generation and better realisation by the power companies has helped them improve their balance sheets, with sales increasing by 10.6% in FY14, over and above a 9.9% growth in the preceding year.

According to a study conducted by Dun & Bradstreet India for its publication ‘India’s Leading Infrastructure Companies 2014’, based on 18 companies in the power sector with a standalone income of more than Rs 100 crore during FY14, the rise in sales can be attributed to a combination of higher realisations and higher power generation.

“During the first half of the year, some of the large companies performed poorly on the revenue front due to a decline in power generation, which in turn can be attributed to an array of reasons like low off-take by state distribution utilities, coal shortage at certain plants, and planned maintenance shutdowns at certain units,” said the report.

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In the second half of FY14, however, the sector was able to bounce back due to double-digit growth in sales by most companies. The report also highlighted the fact that after FY11, opening up of inter-state power transmission for private sector has proved beneficial for the sector.

The report mentions that in the past five years, electricity generation capacity has consistently increased by more than 7%, with 11-15% increase having been recorded in FY12 and FY13. India has also been able to bridge the demand-supply gap in electricity. In FY05, the energy deficit stood at 7.3%, which was pared to 4.2% by FY14.

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First Published: Nov 04 2014 | 5:06 PM IST

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