Adani Power

The stock tanked yesterday after announcing its Q3FY14 numbers. The company once again ended the quarter with a consolidated net loss at Rs.545 crore but the good part is that this loss was narrower than Rs.619 crore loss of Q3FY13 and much lower than huge loss of Rs.1072 crore in Q2FY14.  The company has blamed the loss on higher imported coal cost due to limited availability of domestic coal, non-cash charge of depreciation and provision for deferred tax. PLF also improved to 75% as compare to PLF of 63% achieved in Q2FY14. During the quarter, the company sold 11.2 billion units v/s 9.1 billion units in Q2.

Its major outgo is fuel cost, which at Rs.2525 crore ate away 60% of the net revenue earned. This quarter it also had an additional outgo of Rs.328 crore on cost of power purchased. Forex loss has narrowed from Rs.115 crore in Q2 to Rs.14 crore in current Q3. Interest cost remains huge at Rs.953 crore, more than doubled up YoY and up 10% sequentially. Interest outgo for 9MFY14 was at Rs.2488 crore as against Rs.1646 crore for FY13. Tax outgo too has risen considerably at Rs.131 crore. Though operationally things have improved, coal continues to remain a black spot pushing the company into the red. The company awaits the formal order from CERC on compensatory tariff ofr its Mundra plant.

The company is yet to get a formal order from the Central Electricity Regulatory Commission (CERC) on compensatory tariffs for its Mundra plant, after the Deepak Parekh committee’s proposed formula for large projects on the issue was accepted by the regulator. High debt , rupee depreciation continue to remain a  big concern.