On a steady track
Operational efficiency at ROSA boosts revenues
The 1200 MW ROSA operated at an availability of 103% and a PLF of
~91% but on the back of higher tariffs (~ INR 5.6/unit) due to
escalated coal costs. Being a cost plus model, this acted as a blessing in
disguise and aided the 220% increase in operating revenue YoY. The
receivable position at ROSA seems to be under control with less than 2
months of outstanding.
Butibori continues its previous quarter run rate
Though the 2nd phase of 300MW has just been synchronized and the
1st 300MW already commissioned and in spite of no coal supply from
WCL, Butibori plant seems to continue with its power „trading‟
arrangement under the already signed PPA. The plant reported ~INR
320mn of profits this quarter as well. It is expected to start generation
from April 1, 2013, while the short term sales to Reliance Infra would
continue till April 2014. The company has already filed a petition with
MERC to convert the plant in to a „cost-plus‟ basis which would
mitigate the fuel risk.
Increased visibility: Chhatrasal stage 1 clearance and SASAN
expansion
The 5MTPA chhatrasal mine has received stage 1 forest clearance and
the management expects stage 2 clearance to come by in the next 8
months. This has increased the visibility of Chitrangi plant. With
regards to the TATA Power case pending at the Supreme Court, we
learn that the date for the 1st hearing has not been scheduled yet.
Added to this, the 1st 660MW unit at SASAN is expected to get
synchronized in next few days. The coal mining operations for the
same has been stabilized.
Valuations
With all approvals in place for the 3 mines at Indonesia and land
acquisition in progress for ID-2, we are comfortable assigning an INR
10/share value to the entity. We maintain our target price at INR
110/share and re-iterate our positive stance on the scrip with an
„Accumulate‟ rating.
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