NHPC Limited analyst Q&A

Thank you very much. We will now begin the question-and-answer session. First question is from the line of Mohit Kumar from ICICI Securities. Please go ahead.

Yes. Good afternoon, sir and thanks for the opportunity. My first question is on profitability. Last year, I think we did 36 billion of profit on consol basis. It has declined to 30 billion, 3,000 Crore. You did touch upon on the various one-offs. But can you please help us on broader basis what explains the decline? Is there a one-off in the tax item? You said, it is MAT Credit. But is it related to the past period which is on tax, which you can just help us explain?

Yes, Mohit, so let us discuss at PBT level first. You will find that the decline of Rs. 100 Crore in quarterly number and Rs. 200 Crore in yearly number. So, the quarterly number of Rs. 100 Crore is entirely on account of the reversal of Rs. 110 Crore on account of interest on arbitration, which has been reversed in Q4 itself and that is the reason, you will see that there is a negative finance cost of Rs. 30 Crore. You can treat this item as one-off and if you add back this Rs. 100 Crore number as a one -off, you will arrive at the actual PBT. Similar kind of adjustment if you do at yearly number like Rs. 200 Crore decline in PBT, if you refer our note #5 and note #6 of our financial result, you will find that there is impact of Rs.100 Crore in pay anomaly which has impacted our PBT and Rs. 26 Crore interest on arbitration. So , Rs. 126 Crore impact is there on account of these two numbers and Rs. 100 Crore decline is there in energy charges. So , almost Rs. 200 Crore decline is there.

Understood. Understood. That's very helpful. That's very helpful.

So, those two adjustments you have to carry out to arrive at the adjusted PAT.

Can you please help us with the NHDC revenue and profit numbers for this fiscal?

Please come again.

NHDC, the subsidiary revenues and profits.

So, the total generation of NHDC during the current FY was 5,575 million units as against 4 ,473 million units in corresponding previous year. The revenue from operation is Rs.1,401 Crore as against Rs.1,269 Crore. The PAT is Rs. 837 Crore as against Rs. 812 Crore.

Understood. Can you please help us with the capitalization of Par bati-II in the books? And a related clarification is that how are you going to book the revenues, will it be 85% of the expected capacity charge till the time we get the full tariff order from the CERC, is that right understanding?

Actually, three units have been capitalized from 1st April '25 and the fourth unit will be capitalized from 15th April '25. So, full year generation and full year revenue will be there and we are in the process of filing tariff petition in the CERC. So, based on filing of tariff petition, we will recognize 90% of the revenue on provisional basis till the order comes from CERC.

Understood, sir and what is the amount capitalized on the book?

Amount capitalized will be around Rs. 12,000 Crore plus.

Understood, sir. Thank you.

Thank you. Next que stion is from the line of Ragini Pande from Elara Capital. Please go ahead.

Yes. Thank you for the opportunity. I wanted to know what is the impact of insurance cover, which is not there at Teesta-V now? I mean the insurance cover was till September’24. So, what was the under recovery in Teesta-V?

If you look at the normal circumstances of Teesta-V, TLDP-III and TLDP- IV, all these three projects in Teesta basin, you will find that in normal circumstances, almost Rs. 300 Crore approx. PBT, we earn from Teesta-V, Rs. 100 Crore from TLDP-IV and Rs. 100 Crore from TLDP-III. So, almost Rs. 500 Crore approx. PBT, we earn from these three projects. But due to this flash flood, we have discussed , the last previous number was Rs. 300 Crore, but this year the number is Rs. 92 Crore loss. So, there is almost Rs. 400 Crore approx. loss at PBT level from these three projects.

Okay. Thank you. I just wanted to confirm the adjusted PAT number for Q4 FY’25. So you said that there is an adjustment of Rs. 200 Crore in Q4, right?

In Q4, Rs. 100 Crore adjustment, you have to carry out on account of reversal of interest on arbitration. Rs. 200 Crore is for yearly number.

Understood. Okay. What will be the incremental revenue from the recently commissioned Parbati project?

The design energy of Par bati is 3,074 million units and the expected tariff is around Rs.7.5-8. We have to file the tariff petition with CERC and we have to wait for the final outcome. But approximate number if you want to consider at the rate of Rs.7.5, 87% saleable design energy of 3,074 million units you can consider and that will work out somewhere to Rs. 2,000 Crore.

Okay. Sir, another question was on Suban siri. What is the expected commissioning timeline for the project and the incremental revenue which is expected from it?

As per our plan, we will commission three units by June'25 and rest of five units will be commissioned one -by-one by May '26 and the incremental revenue of this project will be in the range of Rs. 4,500 Crore on annual basis when full commissioning is achieved.

Yes. O kay. Thank you. What is the regulated equity currently after the commissioning of Parbati project?

Yes. So consol level if you want to consider Rs. 13,000 Crore is regulated equity for N HPC's standalone and Rs. 1,000 Crore is regulated equity in NHDC. So, our share is Rs. 14,000 Crore as of now. Considering Rs. 13,000 Crore capital cost of Parbati-II, you can consider 30% of the capital cost as a regulated equity, so it works out to around Rs. 4,000 Crore. So, roughly 14,000 plus 4,000, Rs. 18,000 Crore would be regulated equity in this particular financial year.

Okay. Thank you.

Thank you. Next question is from the line of Prashant Sagar from Anvil Corporate Research Private Limited. Please go ahead.

I just wanted to know the progress of other projects in the Subansiri basin, especially the Middle Subansiri, Upper Subansiri if you can share?

Subansiri Middle i.e. Kamala Hydroelectric Project is 1,720 MW. Pre-DPR chapters already cleared by the CEA and CWC. We have submitted the cost chapters and it is likely to be cleared by the C EA and CWC very soon. So techno economic clearance, we are going to get very soon and at the same time, we have processed for the Environmental Clearance and the Forest Clearance also. So , things are moving very fast . We are expecting that during this year, all clearances will be there and before that, we will move for investment approval, PIB and CC EA. Subansiri Upper is 1 ,605 MW. That is also going well, clearances are progressing. So in these projects , there will be 26% share of the State Government and 74% of NHPC. So for these two projects, the PIB and investment approval, we have to obtain from the Government of India. We are expecting that by the year end, NHPC will move for investment approval from the Government of India. Thank you.

So you said, the share of State Government will be 26% in both the projects or only Upper Subansiri?

No, in Kamala and Subansiri Upper both. The Government of India has approved that any project in Arunachal Pradesh which is allocated to different Public Sector Undertakings like NHPC, SJVN, THDC, NEEPCO, there will be share of the State Government Utilities maximum up to 26% in the JV Company.

About the Dibang Project, you said you have awarded five tenders or whatever. But the balance, when do you expect it to be awarded?

You understand that the entire project has civil works, hydro mechanical works and electrome chanical works i.e. all three types of works . So, we have formulated seven c ontract packages . Out of seven, five contract packages have already been awarded and works are progressing at site. For rest two packages, the tender is opened and it is under evaluation. So we expect that shortly, we are going to award the balance t wo contract packages.

Okay. Sir, about the Middle and Upper Subansiri, has the land acquisition been completed, at what stage it is?

Land acquisition has also started. The district administration has already issued Section IV and then Section VI. So, they have already moved for the acquisition of land for both the projects.

Both the projects. That answers my question. Thank you.

Thank you. Thank you.

Thank you. Next question is from the line of Mohit Kumar from ICI CI Securities. Please go ahead.

The Indus Water Treaty is not abolished. It is kept under suspension. So in this scenario, yes, you are right that now there is a lot of emphasis and we are going to start the Uri-I Stage-II (240 MW) and we have already floated the tenders for civil works. For hydro mechanical works and for electromechanical works , we are going to float the tender s during this month only. The second project , Dulhasti Stage-I (390 MW ) is already there. So, there is a Dulhasti Stage-II Project (260 MW). So for that also , we have received the Approval concurrence, appraisal from the Central Electricity Authority today itself and now, we are going to float the tender during this month end for Civil Works . The third project is 1856 MW Sawalkot Project. For that project also, the approvals are going in very fast mode and we are expecting that very soon, we are going to float the tender for Sawalkot also. At the same time, the possibilities are being explored to start some more projects like Kirthai-II and some more projects in Indus River in Leh, Ladakh area. So , these are the things under the chan ge scenario.

Understood, sir. Are you looking to award the projects under one single EPC umbrella or are you going ahead with breaking the packages? Because I saw one large Sawalkot order based on EPC basis, but I think broken the package again, is that right understanding?

Sawalkot Project, we are going to formulate the entire works of the project in two package s for the civil wo rks, one package for the design and engineering, one for hydromechanical works and one for electromechanical works. So , we have already prepared the bid documents for the two packages and we are waiting for the investment approval from the Government. Then, we'll go ahead.

The first project, we are going to award is Indra Sagar Omkareshwar i.e. 640 MW. The DPR is under evaluation in the CWC and Central Electricity Authority. We are expecting that within next 2-3 months, we are going to get the DPR cleared and once the DPR is cleared, appraisal is cleared, then we'll move ahead with the award of works.

Understood, Sir. Thank you. And all the best, sir.

Thank you. Ladies and gentlemen, that was the last question of the day. I now hand the conference over to management for closing comments.

Yes, Rupesh, thanks a lot for conducting this conference call post result and thank you all participants for your interest and time. Thank you so much.

Thank you. On behalf of Elara Capital, that concludes this conference. Thank you for joining us and you may now disconnect your lines.