NTPC profit up 25% as demand for electricity soars in India

Bloomberg

NTPC Ltd, India’s largest power producer, posted a 25% jump in quarterly profit as demand for electricity soared in one of the world’s fastest-growing economies.
Profits increased to 41.3 billion rupees ($551 million) in the three months through December, compared with 33.2 billion rupees a year ago, the state-run company said in a stock-exchange filing. Profits surpassed an average analyst estimate of 35.9 billion rupee. Revenue jumped 18% from a year earlier to 288.6 billion rupees.
Demand for electricity in India jumped after factories and commercial establishments ramped up operations following months of slowdown caused by the pandemic.
NTPC’s coal-fired plants, which account for 89% of the company’s standalone generation capacity, operated at an average utilisation rate of about 68% during the period.
Power producers faced one of the country’s worst coal supply disruptions during the quarter, leading to a plunge in inventories. While supplies have improved, generators such as NTPC are leaning back on imports to maintain stockpiles of the fuel that helps produce nearly 70% of India’s electricity.
The company, which is emerging as a major champion of India’s clean-energy transition, said in a separate statement that it will spin off its renewable energy assets to a wholly owned company. It will either seek strategic investors or hold an initial share sale for the renewable-power company, it said.
Total expenditure for the period rose 13% from a year earlier to 244.3 billion rupees. Costs may rise further as the company revives coal imports.
The New Delhi-based power producer’s income from other sources has increased 28% to 9.72 billion rupees.