That a large part of NTPC’s reported under-recoveries of Rs210 crore in Q2FY19 was due to unavailability of coal exacerbated the coal supply crisis in the country. The company had reported Rs 1,400 crore of under-recovery in FY18, of which Rs800 crore was due to coal shortage.
The company’s net profit slipped 1.1% year-on-year (y-o-y) to Rs2,417.6 crore in the quarter. Fuel stock at NTPC’s power plants remains low with current coal stock of 3.7 MT from a high of 6.9 MT.
“Though NTPC’s earnings prospects appear bright due to capacity addition and rise in regulated equity, this will be overshadowed by ongoing under-recovery due to coal shortage that will dampen core return on equity,” Axis Capital said in a recent report.
In the first half of FY19, NTPC’s under-recovery due to coal shortage at 2,320 MW Mouda plant, 2,000 MW Simhadri station and 2,400 MW Kudgi unit was `156 crore, `78 crore and `25 crore, respectively. Read More