Capitaline

Analyst Meet / AGM 16-Feb-18

Conference Call

PTC India Financial Services

Expects to sustain loan growth of 25-30% for near term

PTC India Financial Services (PFS) conducted a conference call on 15 February 2018 to discuss the financial results of the company for the quarter ended December 2017. Dr. Ashok Haldia, MD&CEO addressed the call:
Highlights:

The loan assets of the company increased 21% to Rs 11672 crore end December 2017. Meanwhile, the non-fund based commitment surged 182% to Rs 1625 crore. Thus, the outstanding credit (aggregate of funds based and non-fund based exposure) increased 30% to Rs 13297 crore end December 2017. The company expects the credit growth of 25-30% for near term.
As per the company, there is no significant bidding for new power capacity from central as well as state governments. However, the government has invited tenders for 2000 MW of wind power projects.
As per the company, its existing sanction pipeline wood support its loan growth. The company is also diversifying into non-power segment such as roads, ports, transmission and distribution.
The Capital Adequacy Ratio of the company is strong at 23%, so the company is well capitalized to support loan growth.
The debt sanction declined 50% to Rs 1685 crore in Q3FY2018, comprising mainly of Rs 596 crore to renewable projects, Rs 339 crore to transmission and Rs 600 crore to distribution sector. The cumulative effective debt sanctioned stood at Rs 22187 crore end December 2017.
The company has exhibited strong 151% jump in the disbursements to Rs 1501 crore in Q3FY2018.
The Net Interest Margin (NIM) and spreads of the company eased to 4.24% and 2.26% for Q3 FY2018, which were impacted due to interest income de-recognition on account of restructuring of loans under SDR scheme. The exposure of the company under SDR scheme stood at Rs 600 crore end December 2017.
Adjusted for the impact of stressed loan assets, the yield on loans for the company stands at 11.54% against 10.5% and NIM and Spread stood at 5.27% and 3.31% respectively for Q3 FY2018.
The bottomlines of the company have been impacted by provisioning against loans and equity investment during the period, and most of the non-performing and other stress assets are moving towards resolution.
Sustained efforts have helped in keeping the stressed loan assets under check and the gross NPAs have reduced to 4.87% end December 2017 from 5.92% end September 2017. The company would the aggressive NPA resolution efforts and expects resolution of more NPAs in Q4FY2018 and Q1FY2019.
The company has exhibited sharp decline in share of thermal power project to 19% end December 2017 from 26% a year ago. Meanwhile, the share of renewable energy projects has increased to 56% end December 2017 from 45% a year ago.
Of the renewable energy segment, about 60% is solar based and 40% is wind based power projects. The quality of renewable power projects is very strong, except two accounts. In case of first accounts the exposure is Rs 12 crore, while in case of second account relating the wind project in Maharashtra a substantial amount has been recovered.
The decline in NPA in Q3FY2018 was aided by upgrade of the account of KSK Energy.
The company has continued to maintain the provision coverage ratio of 46-47%.
The exposure of Rs 600 crore under SDR scheme is towards Konaseema at Rs 100 crore with provision of Rs 40 crore, RKM at Rs 60 crore with provision of Rs 33 crore, Surana at Rs 96 crore with provision of Rs 55 crore, Shalivahana at Rs 13 crore with provision of Rs 4 crore, Rajpur Hydropower at Rs 60 crore with provision of Rs 25.25 crore, Kohinoor at Rs 50 crore with provision of Rs 33 crore, Tispara at Rs 55 crore with provision of Rs 11.7 crore, NSL Nagapattnam at Rs 125 crore with provision of Rs 12.5 crore.

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