DVC posts Rs 19 cr Q4 net profit, charts out turnaround plan
Kolkata: Damodar Valley Corporation (DVC) has set an ambitious target of Rs 552 crore net profit for the 2018-19 financial year. DVC's optimism comes in the wake of the public sector undertaking clocking a profit of Rs 19 crore in the fourth quarter of FY 18.
"We have posted Rs 19 crores net profit in the fourth quarter that ended March 2018 after a gap of 15 consecutive quarters. We are targeting Rs 552 crore profit in the current fiscal (FY19')," DVC member-secretary and acting chairman P. K . Mukhopadhyay said.
Responding to a poser on how DVC had scripted such a remarkable turnaround Mukhopadhyay said that streamlining of machine operations, planned cost cutting measures, aggressive sale in power exchange and exports and most important running Raghunathpur thermal power station in full capacity have been the key drivers for the growth of DVC. He expressed his optimism of achieving around Rs 2739 crore additional revenue compared to Rs 15,729 crore revenue in 2017-18 fiscal. DVC has set a target of generating 46500 MU of electricity.
Mukhopadhyay officially announced DVC's termination of MoU with NLC India (Neyveli Lignite) to hive-off 1200MW Raghunathpur thermal power plant into a JV despite Bengal government's approval for the same.
It may be mentioned that Raghunathpur was a drag on the DVC's finances due to high-interest burden of Rs 840 crore annually. "Raghunathpur thermal power plant will be the cheapest power plant in which fixed cost will come to Rs 1.65 per unit based on Rs 9300 crore cost. The cost is yet to be finalised by the Central Electricity Regulatory Commission," he said. He maintained that Bengal which is one of the major stakeholders for DVC will have an income on coal cess account combined with GST to the tune of Rs 400 crore per annum with DVC's decision of retaining Raghunathpur in its own hands.
"Raghunathpur which is presently operating at about 400 MW will start generating 800MW from May-June and from early next year full-load generation of 1200 MW will take place. Rail line connectivity will be over by December and with dual connectivity in road and rail generation will get a much needed boost," Mukhopadhyay said.
DVC from June will start supplying 300 MW to Bangladesh in its first ever foray for cross border supply on the basis of 13 years 6 months contract.
The company has started retiring several old capacities. In 2017-18, DVC had retired 820MW and by 2020 another 550MW worth of capacity will be put-off to move out from high-cost power generation.
DVC is now left with 7090MW of thermal and 147.2MW hydel generation capacity.