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Power Generation Growth Would Remain at 8-9% in Coming Months: Karvy

  • ``Based on our channel check, India`s generation data suggest positive trend for thermal power plants as said earlier. India`s power generation was higher because due to higher coal output and increased rakes availability for coal-based plants. The overall power generation was lowered by 600 bps in Dec`11, as compared to Nov`11 owing to lower output from hydel plants. We believe that the power generation growth would remain at 8-9% in coming months on the back of higher rakes availability and higher coal output,`` opined Karvy Stock Broking.

Following are the power sector highlights:

  • All-India Generation up 8% y-o-y (down 600 bps MoM) PLF Increases by 500 bps vs 69% target. Thermal Power Generation up 8.59% YoY (up 6.6% YTD)The all-India power generation grew 8% YoY to 72.7 billion units (BUs) in Dec’11, led by a rise in installed capacity by 15GW over the past 12 months and increased generation from coal-based plants. However, the overall power generation declined by 600 bps on MoM basis due to lower generation from hydel plants up 4% YoY in Dec’11 (up 19%YTD).

Company-wise Performance:

  • Adani Power (APL):The Company`s generation rose 90% YoY to 1,395 million units (MUs) owing to on commissioning of Unit-II of Mundra Phase-III. However, the blended PLF of the plant was 52% in Dec`11, as against 51% in Nov`11 (vs 79% target).

CESC:

  • Though the Company`s generation rose 4.5% YoY to 683 MUs, it declined 3.3% on MoM basis owing to lower coal availability.

  • JSW Energy:Though the Company`s generation declined 8% MoM to 1,084 MUs, it rose 27% YoY in Dec`11. The Raj West plant is awaiting approval for tariff hike from Rajasthan Electricity Regulatory Commission (RERC), which has affected the overall generation.

Jindal Power:

  • The Company generated 749 MUs in Dec’11 (down 1.7% YoY & up 2.1% MoM), while its PLF declined by 190 bps YoY to 100%.§  Lanco Infratech: The Company generation at Kondapali declined 1.6% YoY to 334 MUs (down 15% MoM) on lower gas availability. Though the power generation from Amarkantak plant declined 3.2% MoM, it rose 18% on YoY basis.

NTPC:

  • The Company`s generation increased 4.7% YoY (up 1.7% MoM) to 19.5 owing to increased coal availability from Coal India. The PLF of coal plants rose by 520 bps YoY in Dec`11 (83% YTD) out of programmed 80.8%§  NHPC & SVJN: The Company’s generation declined 9.5% YoY (2% YTD) to 596 MUs, while SJVN`s generation declined 15% YoY (up 9% YTD) to 255 MUs in Dec’11 due to lower water availability.

  • Coal India`s Lower Production & Decreased Output Estimate:In Q2FY12, the coal output of Coal India (CIL) has been affected by heavy showers in Orissa and strikes in SCCL on Telangana issue. Its lower production and decreased output estimate have raised concerns over the incremental coal supplies, which are insufficient to run the plants based on coal linkages. This poses challenge to the very viability of projects based on domestic coal, amid the concerns over logistics issues and boiler inability to take over 20% blended coal.

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