PowerGrid ups Q1 net 20%, eyes `1.1 trillion capex

Total first quarter income rose to `3,634 crore, a rise of 22% from `2,980 crore in corresponding year-ago period

Power Grid Corporation of India Limited, a Navratna company, posted a 20 per cent jump in net profit at Rs 1,040.34 crore in the June quarter. It had reported Rs 870 crore net profit during the corresponding quarter ended 30 June, 2012.

Total income (turnover) for first quarter (April-June, 2013), rose to Rs3634 crore, up by 22% from Rs 2980 crore in the corresponding year-ago period.

The public sector undertaking (PSU) has also decided to revise upwards its capital expenditure for the 12th Plan period (2012-17) by 10-12 per cent to meet expansion plans, a top official said. The state-run firm has also decided to sell 15 per cent stake through a follow-on public offer to raise funds but did not offer a timeline.

'We are constantly expanding our reach and undertaking new projects. We had earlier estimated a capex of Rs 1 trillion during the 12th Plan (2012-17). But with the kind of projects that we are pursuing, we think we will need more funds,' PowerGrid Chairman and Managing Director R N Nayak said.

He said the company plans to increase its capex plans by 10-12 per cent.

'Earlier, we had planned a capex of Rs 20,000 crore per annum for five years, which would cater to the needs of projects or schemes to the tune of Rs 1 trillion over the five -year period. However, we are anticipating projects to the tune of Rs 1.1 trillion now. To meet the capital expenditure for projects of this volume, we will need more funds.'

Accordingly, it has anticipated a capex of Rs 20,037 crore for FY13, Rs 22,150 crore for FY14, Rs 22,450 crore for FY15, Rs 22,500 crore for FY16 and Rs 22,550 crore in FY17.

'The additional capex will be required for various tariff-based bidding projects that we plan to undertake.Besides, it will be required for undertaking projects assigned by the Government, green energy corridors, intra-state projects and transnational interconnections,' Nayak said.

The PSU will sell 15 per cent stake through follow-on public offer (FPO). 'This FPO will help us meet additional capex requirement,' its Finance Director R T Agarwal said.

This would be the second time that PowerGrid would be going for FPO after November 2010.Asked whether the company is looking at raising funds from overseas, Agarwal said, 'that is always an option. We will evaluate the opportunities. If we feel the domestic option is cheaper, we will go for it.'

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