Key takeaways of the call

Amidst challenging demand scenario for power offtake (offtake for Q3FY20 and 9mFY20 down by about 9% and 6% respectively), the company has successfully sustained the trading volumes in Q3FY20& 9mFY20.

Standalone trading volumes has increased by 2 % to 13,153 MUs (from 12,921 MUs.) for Q3FY20 and by 5 % to 54,329 Mus (from 51,860 Mus) for 9mFY20.

Margin per unit (without considering surcharge and rebate) for Q3FY20 and 9mFY20 stood at Rs 0.0368/unit (down from Rs 0 .0412/unit) and Rs 0.0366/unit (down from Rs 0.0408/unit) respectively. But including surcharge and rebate the margin per unit will increase to Rs 0.0885 (against Rs 0.0872/unit) and Rs 0.0734/unit (against Rs 0.0711/unit) for Q3FY20 and 9mFY20 respectively.

Consolidated trading volume has increased by 2 % to 13,153 MUs (from 12,921 Mus) for Q3FY20 and by 5 % to 54,329 MUs (from 51,860 Mus) for 9mFY20.

Expect to witness a gradual turnaround of the power demand in coming quarters.

The company expects to close the fiscal with a volume growth of about 5%.

The 550 MW of RKM Power become operationalized from Feb 1, 2020. And with this the entire 1900 MW capacity under Pilot I (resolution of stressed thermal assets of MoP) has been done. Further the company has won the aggregators mandate for Pilot II of 2500 MW of stressed thermal assets. The company has got 21 bids for 61000 MW for which reverse auction will be conducted and price will be discovered. Once that is done the company will enter into PPAs and FSAs and approach the state regulators. So for this process will take anywhere between 3-6 months. So Pilot II contribution will commence in FY21. So Pilot II along with 550 MW RKM power will drive the volume growth next fiscal.

The process for disinvestment of non-core assets is on but could not give a time frame for closure of it.

While standalone net profit stand higher by 13%, the sharp 30% fall in net profit of consolidated entity is largely on account of PTC Energy, the subsidiary company which registered a loss of Rs 37.95 crore for the quarter ended Dec 2019. While the PBT loss of the PTC Energy was just RS 14 crore at PAT level it jumped due to MAT. Weak performance of PTC Energy was largely due to weak wind season as well as AP issue. Wind generation in Q4FY20 is expected to be good and the HC has seized up with AP issue and that might help improve the situation going forward.

PTC has won the tender for repeat business from AKVN in Techno – Commercial consultancy business. The deal value is 6.8 Crores for 2 years.

In distribution management business the company has added Paradip Port Trust as new addition. This 3 year service contract will add more than 11 Crores to the distribution business of the company. PTC's service area will be spread over 10 Sq. kms, and will cater to about 6400 numbers of consumers in the domestic, commercial and industrial categories.

Broadening service profile for Indian Railways (IR), PTC has made IR as their client for transaction on energy exchange.