The operational results during the current quarter have been impacted on account of (i) inclusion of interest cost in the operational exenditure due to commissioning of 250 MW Unit II of Jaypee Bina Thermal Power Plant in April 2013 (ii) The current revenue at 500 MW Jaypee Bina Thermal Power Plant is on account of provisional tariff, pending final tariff determination (iii) Lower realisation for power sold on merchant basis due to prevailing market conditions and (iv) Long Term Open Access (LTOA) charges in respect of 1000 MW Jaypee Karcham Wangtoo H.E. Plant were not payable in the corresponding quarter/ period of previous year, since LTOA got transferred to the company from PTC India only in Jan 2013 (V) Non realization of revenue in Vishnuprayag HEP on account of secondary energy and incentive for plant availability due to shut down of plant w.e.f June 16, 2013 because of natural calamity causing unprecedented heavy flood in river Alaknanda.

• On an empirically weak quarter, the sales (excluding other operating income) were higher by 16% to Rs 427.61 crore. Though there is no generation from Vishnuprayag, which was not operational on account of Uttarakhand floods w.e.f from June 16, 2013 the quarter has the benefit of incremental generation out of the additional 250 MW unit capacity i.e. the second unit of Bina TPS which got commissioned effective April 2013 as well as higher generation from Baspa HEP and Karcham Wangtoo HEP. While the generation of Bina TPS more than doubled that of Baspa HEP and Karcham Wangtoo HEP was up by 3%yoy and 73%yoy in Q4FY14. In respect of Hydro Power Projects, the water availability in the first half of the financial year is higher as compared to the second half. As such, the power generation in the first two quarters is about 70% of the annual power generation, while balance 30% is generated in third and fourth quarter.

• The 440 bps can be explained by lower transmission charges, staff cost and other expenses. As proportion to sales the operation expenses was higher by 220 bps to 5.7%, the cost of fuel was up 410 bps to 24.8%. However the transmission charges was lower by 850 bps to 12%, the staff cost was down by 50 bps to 4.2% and the other expenses was lower by 160 bps to 5.1%.

• The other income was up by 179% to Rs 29.39 crore, the interest cost was up by 25% to Rs 367.23 crore and the Depreciation was up by 49% to Rs 123.60 crore. Higher interest and depreciation cost is on account of charge of the same to P&L account with new generation project get commissioned. Thus at PBT level it was a loss of Rs 254.67 crore compared to a loss of Rs 203.39 crore in the corresponding previous period.

• EO expense was Rs 0.08 crore compared to nil in the corresponding previous period. Thus the PBT (after EO) was a loss of Rs 254.75 crore compared to a loss of Rs 203.39 crore in the corresponding previous period. The taxation was a write back of Rs 82.77 crore compared to a write back of Rs 81.20 crore in the corresponding previous period. Thus at PAT level it was a loss of Rs 171.98 crore compared to a loss of Rs 122.26 crore in the corresponding previous period.

YTD Performance

Standalone sales were higher by 19% to Rs 2677.50 crore and the operating profit was higher by 6% to Rs 1832.36 crore. Even as other income stand higher by 65%, dragged by higher interest and depreciation and taxation, the PAT was lower by 94% to Rs 19.73 crore.

Consolidated sale were higher by 17% to Rs 2874.39 crore and with 820 bps contraction in operating margin the growth at operating profit was limited to 5% to Rs 2022.38 crore. Eventually the net profit (after minority interest) was lower by 91% to Rs 32.86 crore.

Other developments

The Company today has operating capacity of 1700 MW (Hydro) and 500 MW (Thermal). First unit of 2X660 MW Jaypee Nigrie Super TPS has been synchronized with grid on May 7, 2014 and its commercial operation is expected by June 2014.

The 400 MW Jaypee Vishnuprayag H.E. Plant, which was affected by natural calamity w.e.f. June 16, 2013 and underwent restoration has commenced power generation w.e.f April 12, 2014.

MAT, amounting to Rs 2.82 crore, for the year ended March 31, 2014 is available as credit to be claimed in subsequent years. Therefore, the same has been treated as MAT credit entitlement. Since Deferred tax liability of Rs 6.29 crore has been reversed for the fiscal ended Mar 2014, an amount of RS 82.77 crore has been written back as deferred tax charge during Q4FY14.

The BoD of the company in their meeting held on Mar 1, 2014 considered and accepeted the disinvestment of the two of the company's operating plants namely, 300 MW Jaypee Baspa HEP and 1000 MW Jaypee Karcham Wangtoo HEP (Karcham HEP) subject to requisite statutory and regulatory approvals. The disinvestment is proposed to be by way of hiving off the aforesaid plants into two separate wholly owned subsidiaries namely Himachal Baspa Power Company and Himachal Karcham Power Company through a scheme of arrangement to be sanctioned by Hon'ble High Court of Himachal Pradesh with ultimate transfer of ownership of the said subsidiaries to the purchases TAQA India Power Ventures (an indirectly owned and controlled subsidiary of Abu Dhabi National Energy Company), Indo-Infra Inc ( a large institutional Canadian investor) and India Infrastructure Fund II (acting through IDFC Alternatives). The company will use the proceeds from disinvestment to retire its debts as well as to fund the equity required for implementing its thermal power projects. The transaction has since been approved by Competition Commission of India.

The scrip is hovering around Rs 23.73.