Mar 31, 2023
The Board of Directors hereby submits the report of the business and operations of your Company (âthe Companyâ or âPTC India Limited/ PTCâ) along with the audited financial Statements of the Company and its subsidiaries for the financial year ended March 31, 2023.
The summarized standalone and consolidated results of your Company (along with its subsidiaries & associates) are given in the table below.
(In INR Crores) |
||||
Particulars |
Financial Year Ended |
|||
Standalone |
Consolidated |
|||
31/03/2023 |
31/03/2022 |
31/03/2023 |
31/03/2022 |
|
Total Income |
14,909.57 |
15,637.62 |
16,002.51 |
16,879.77 |
Profit / (Loss) before Interest, Depreciation & Tax (PBITDA) excluding OCI |
514.22 |
612.45 |
1,381.52 |
1,597.55 |
Finance Charges |
28.92 |
37.33 |
599.62 |
751.47 |
Depreciation |
3.86 |
3.74 |
101.53 |
101.32 |
Provision for Income Tax (including for earlier years) |
111.7 |
146.57 |
173.22 |
193.09 |
Net Profit / (Loss) after tax (after minority interest) |
369.74 |
424.81 |
445.60 |
506.16 |
Profit / (Loss) brought forward from previous year |
1,116.48 |
1,044.11 |
1,336.66 |
1,294.94 |
Amount transferred to General Reserve |
116.71 |
130.43 |
116.71 |
130.43 |
Dividend paid (including dividend tax) |
171.68 |
222.01 |
171.68 |
222.01 |
Transferred to special reserve |
- |
- |
23.54 |
0 |
Transfer to impairment reserve |
- |
- |
- |
95.37 |
Transferred from reserve for equity instrument through OCI |
- |
- |
(4.52) |
- |
Transferred to Statutory reserve |
- |
- |
22.85 |
16.90 |
Re-measurement of post-employment benefit obligations, net of tax |
- |
- |
0.08 |
0.27 |
Profit / (Loss) carried to Balance Sheet |
1,197.83 |
1,116.48 |
1,443.04 |
1,336.66 |
Other comprehensive income /(Loss) (after minority interest) |
19.31 |
9.97 |
19.64 |
16.03 |
Total comprehensive income (after minority interest) |
389.05 |
434.78 |
465.24 |
522.19 |
Your Company has two subsidiaries, namely PTC India Financial Services Limited (PFS) and PTC Energy Limited (PEL). The consolidated turnover (including other income) of the group is INR 16,002.51 Crores for the Financial Year 2022-23 as against INR 16,879.77 Crores (including other income) for the Financial Year 2021-22. The consolidated Profit after Tax (after minority interest) of the group is INR 445.60 Crores for the Financial Year 2022-23 as against INR 506.16 Crores (after minority interest) for the Financial Year 2021-22.
CONSOLIDATED FINANCIAL STATEMENTS
The Consolidated Financial Statements have been prepared in accordance with the Accounting Standard notified under Section 133 of the Act (âActâ) and the relevant rules issued thereunder read with the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 (hereinafter referred as âListing Regulationsâ) and the other accounting principles generally accepted in India. The Consolidated Financial Statements form part of the Annual Report.
Note: The above statements and the financial figures given under the head âFinancial Resultsâ are extracted from the Standalone and Consolidated Financial Statements which have been prepared in accordance with the Indian Accounting Standards (Ind-AS) as notified under Section 133 of the Companies Act, 2013 (hereinafter referred as âthe Actâ), read with Companies (Indian Accounting Standards) Rules, 2015 and relevant amendment rules thereafter and other recognized accounting practices and policies, to the extent applicable.
RESULTS OF OPERATIONS AND STATE OF COMPANYâS AFFAIRS
The trading volumes for the year FY 2022-23 were 70,610 MUs as against 87,515 MUs during the previous year. With a turnover (including other income) of INR 14,909.57 Crores for the year 2022-23 as against INR 15,637.62 Crores (including other income) in the Financial Year 2021-22, your Company has earned a Profit after Tax of INR 369.74 Crores as against INR 424.81 Crores in the previous year.
Out of the profits of the Company, a sum of INR 116.71 Crores has been transferred to General Reserves during the Financial Year and total reserves and surplus of the Company are INR 3836.27 Crores (including securities premium)
as on 31st March 2023.
The Board of Directors of your Company are pleased to recommend for your consideration and approval, a final dividend @ 78% for the Financial Year 2022-23 i.e., '' 7.80 per equity share of INR 10 each. The final dividend, if approved, at the ensuing Annual General Meeting (AGM) will result in a cash outflow of INR 230.89 Crores.
In pursuant to Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company in its Board Meeting held on 5th Feb. 2020 had adopted a dividend distribution policy and the same is placed on the website of the Company and can be accessed through the following link: https://www.ptcindia.com/wp-content/uploads/2020/04/Dividend-
Distribution-Policy.pdf
NET WORTH AND EARNINGS PER SHARE (EPS) ON A STANDALONE BASIS
As on 31st March 2023, Net worth of your Company was INR 4132.28 Crores as compared to INR 3914.91 Crores at the end of the previous Financial Year.
EPS of the Company for the year ended 31st March 2023 stands at INR 12.49 in comparison to INR 14.35 for the Financial Year ended 31st March 2022.
MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There have been no material changes and commitments affecting the financial position of the Company which have occurred from the end of the Financial Year of the Company to which the financial statement relates i.e., 31st March 2023 till the date of this report.
CHANGE IN THE NATURE OF BUSINESS, IF ANY
There is no change in the nature of business of your Company during the year under review.
During the period under review, no change has taken place with regard to the capital structure of the Company.
As on 31st March 2023, PTC has an Authorized Share Capital of INR 750,00,00,000 and paid-up share capital of INR 296,00,83,210 divided into 29,60,08,321 equity shares of INR 10 each. The equity shares of your Company are listed on the âBSE Limitedâ (BSE) and âNational Stock Exchange of India Ltd.â (NSE). The promoters i.e. NTPC Ltd. (NTPC), Power Grid Corporation of India Ltd. (POWERGRID), Power Finance Corporation Ltd. (PFC) and NHPC Ltd. (NHPC) individually hold 4.05% each or 16.20% collectively of the paid-up and subscribed equity share capital of your Company and the balance of 83.80% of the paid-up and subscribed equity share capital of your Company is held by Power Sector Entities, Financial Institutions, Life Insurance Corporation of India, other Insurance Companies, Banking Institutions, Corporations, Investment Companies, Foreign Institutional Investors, Private Utilities and others including public at large.
HOLDING, SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES
Pursuant to sub-section (3) of section 129 of the Act, the statement containing the salient features of the financial statement of the Companyâs subsidiaries, associates and joint ventures entities given in Form AOC-1 is annexed to this report at Annexure 1. There has been no material change in the nature of the business of the subsidiaries and during the year, no company has ceased to be/ became Subsidiary/ Associate of the Company.
Holding Company
The Company does not have any holding company.
Subsidiary Companies
PTC India Financial Services Limited
PTC India Financial Services Limited (PFS) is a listed subsidiary of your Company incorporated on 08th September 2006 in New Delhi wherein PTC holds a 64.99% stake and has invested INR 754.77 Crores. PFS is listed on NSE & BSE and has been classified as an Infrastructure Finance Company (IFC) by the Reserve Bank of India. PFS recorded total income of INR 797.08 Crores during FY 23 as compared to last yearâs revenue of '' 968.75 Crores. Interest income for FY23 has decreased to INR 766.57 Crores as against the previous yearâs INR 924.69 Crores. The profit before tax and profit after tax for FY23 stood at INR 232.37 Crores and INR 175.81 Crores respectively. Earnings per share for FY23 stood at INR 2.74 per share. The Statutory Auditor of PFS is M/s. Lodha & Co., Chartered Accountants, who has been appointed in the year 2022.
PTC Energy Limited (PEL)
PEL is a wholly owned subsidiary of your Company incorporated on 1st August 2008 in New Delhi wherein PTC holds 100% stake and has invested INR 654.11 Crores. PEL has recorded revenue from operations of '' 296.77 Crores during FY 23 as compared to last yearâs revenue of INR 280.67 Crores. The profit/ (loss) before tax and profit/(loss) after tax for FY23 stood at INR 18.83 Crores and INR 13.88 Crores respectively. The Statutory Auditor of PEL is M/s. S.P. Chopra & Co., Chartered Accountants, who has been appointed in the year 2018.
Investment in other companies (Amount released up to 31st March 2023)
⢠Your Company had invested INR 150 Crores in Athena Energy Ventures Private Limited (AEVPL). Since the projects of this Investee Company could not be commissioned in time and considering other related factors and fair value, there had been a reduction of INR 149.97 Crores towards the investment which had been accounted over the earlier years.
⢠Your Company had invested INR 37.55 Crores in Krishna Godavari Power Utilities Limited. However, due to slow progress and other issues, provision was made for the entire amount of INR 37.55 Crores during FY 2015-16.
⢠Teesta Urja Limited (TUL) has implemented a project of 1200 MW Teesta III Hydro Electric Project and your Company initially invested a sum of INR 224.33 Crores in the equity of TUL. The Company had divested part of its long-term investment in TUL so that the Govt. of Sikkim could acquire 51% against its present holding of 26%. This disinvestment had been of 4,39,62,777 shares which reduced the shareholding of PTC. The majority stake of TUL is held by the Govt. of Sikkim (GoS) and the shareholding of PTC in TUL is now 5.62%. As on 31/03/2023, the Company has carried out a fair valuation of investment in TUL and the same stood as INR 221.10 Crores as against INR 202.01 Crores of previous year.
⢠Your Company offered to sell all of its shares of Chenab Valley Power Projects Private Limited to NHPC Limited at a value of INR 4.19 crores. NHPC Limited paid the entire consideration on May 25, 2021, and subsequently, the Company has handed over physical share certificates to NHPC Limited for transfer of shareholding in the name of NHPC Limited. However, no further information has been received from NHPC.
⢠Your Company has made an equity investment of INR 12.50 Crores during the FY 20 in a new entity i.e., Hindustan Power Exchange Limited (earlier named as Pranurja Solutions Limited) with other equity partners i.e., BSE investments Limited and ICICI Bank for development of a new Power Exchange. The company got its registration from CERC on 12th May 2021.
All contracts/ arrangements/ transactions entered into by the Company during the financial year with related parties were in the ordinary course of business and on an armâs length basis and do not attract the provisions of Section 188 of the Act. During the year, the Company had not entered into any contract/ arrangement/ transaction with related parties which could be considered material in accordance with the policy of the company on materiality of related party transactions.
Accordingly, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Companies Act, 2013 in Form AOC-2 is not applicable.
DIRECTORSâ RESPONSIBILITY STATEMENT
Pursuant to the requirements of clause (c) of sub-section (3) of Section 134 of the Act, the Board of Directors of your Company confirms that:
a. In the preparation of the annual accounts for the year ended March 31, 2023, the applicable accounting standards have been followed and there are no material departures from the same.
b. The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as of March 31, 2023, and of the profit of the Company for the year ended on that date.
c. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.
d. The Directors had prepared the annual accounts of the Company on a going concern basis.
e. The Directors had laid down the internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.
f. The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
The Company has in place adequate internal financial controls with reference to financial statements. The Board has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Companyâs policies, safeguarding of its assets, the prevention of and detection of fraud and errors, the accuracy & completeness of the accounting records and the timely preparation of reliable financial disclosures.
The Company has appointed M/s Ernst & Young for the above purpose.
APPOINTMENT/ RE-APPOINTMENT OF DIRECTORS AND KEY MANAGERIAL PERSONNEL AND RESIGNATIONS/ COMPLETION OF TENURES BY THE DIRECTORS AND KEY MANAGERIAL PERSONNEL
During the Financial Year 2022-23, there were following changes in the composition of Board of Directors of the Company:
Sr. No. |
Name of Director |
Joining/ Cessation |
Date of joining/ Cessation |
4 |
Shri Jayant Purushottam Gokhale |
Cessation |
December 5, 2022 |
5 |
Smt. Sushama Nath |
Cessation |
December 5, 2022 |
6 |
Shri Subhash S. Mundra |
Cessation |
December 5, 2022 |
7 |
Smt. Preeti Saran |
Cessation |
December 6, 2022 |
8 |
Shri Prakash S. Mhaske |
Appointment |
January 16, 2023 |
As per the provisions of the Companies Act, Smt. Sangeeta Kaushik Director will retire by rotation at the ensuing Annual General Meeting and being eligible has offered herself for re-appointment. The Board recommends her re-appointment. The Board also recommends the appointment of Sh. Rajiv Ranjan Jha, who was appointed as additional (nominee) director of PFC Ltd. on 30th June 2023, as Director at ensuing AGM.
DETAILS OF BOARD MEETINGS
During the financial year ended 31st March 2023, the Board met Ten (10) times. The details of Board meetings are mentioned in the Corporate Governance Report as annexed to this report. The intervening gap between the two meetings was within the period prescribed by the Act and Listing Regulations.
For further details in respect of Composition, number and attendance of each director in various Committees of Board as required in accordance with Secretarial Standard-1 on Board Meetings and Listing Regulations, please refer to the Corporate Governance Report of this Annual Report.
COMMITTEES OF THE BOARD
As on March 31, 2023, the Board had all Statutory Committees i.e., Audit Committee, Nomination & Remuneration Committee, Corporate Social Responsibility Committee, Stakeholders Relationship Committee, Risk Management Committee. The other Committees/Group of Directors formed from time to time for specific purposes. The full details are available in the Corporate Governance Report.
AUDIT COMMITTEE
The Company has duly constituted an Audit Committee, whose detailed composition and powers are provided in the Corporate Governance Report. There were no recommendations from the Audit Committee which have not been accepted by the Board during the financial year.
DECLARATION BY INDEPENDENT DIRECTORS
The Company has received the necessary declaration from each independent director under Section 149(7) of the Act, that he/she meets the criteria of independence laid down in Section 149(6) of the Act and Regulation 25 of the Listing Regulation. The Independent Directors have also confirmed that they have complied with the Companyâs code of conduct for Directors and Senior Management Personnel.
All the Independent Directors of the Company have registered themselves in the data bank maintained with the Indian Institute of Corporate Affairs, Manesar (âIICAâ). In terms of Section 150 of the Act read with Rule 6(4) of the Companies (Appointment & Qualification of Directors) Rules, 2014, the Independent Directors are required to undertake an online proficiency self-assessment test conducted by the IICA. The Independent Directors, whosoever is required, shall undertake the said proficiency test.
In the opinion of the Board all independent directors possess a strong sense of integrity and have requisite experience, qualification and expertise and are independent of the management. For further details, please refer to the Corporate Governance report.
Sr. No. |
Name of Director |
Joining/ Cessation |
Date of joining/ Cessation |
1 |
Dr. Rajib Kumar Mishra |
Appointment (CMD) |
March 29, 2023 |
2 |
Shri Raghuraj Madhav Rajendran |
Cessation |
December 01, 2022 |
3 |
Shri Mohammad Afzal |
Appointment |
December 12, 2022 |
The performance evaluation process and related tools are reviewed by the âNomination & Remuneration Committeeâ on a need basis, and the Committee may periodically seek independent external advice in relation to the process. The Committee may amend the Policy, if required, to ascertain its appropriateness as per the needs of the Company from time to time.
The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual directors, which includes criteria for performance evaluation of the non-executive and executive directors. The overall effectiveness of the Board is measured based on the ratings obtained by each Director and accordingly the Board decides the Appointments, Reappointments and Removal of the non-performing Directors of the Company. On the basis of the Policy for Performance Evaluation of Independent Directors, a process of evaluation is being followed by the Board for its own performance and that of its committees and individual Directors.
The exercise was carried through a structured evaluation process covering various aspects of the Board including committees and every Director functioning such as composition of Board and committees, experience and competencies, performance of specific duties and obligations, governance issues, etc. A questionnaire formed a key part of the evaluation process for reviewing the functioning and effectiveness of the Board.
Board members had submitted their response for evaluating the entire Board, respective committees of which they are members and their peer Board members, including Chairman of the Board.
The evaluation process focused on various aspects of the Board and Committees functioning such as structure, composition, quality, Board meeting practices and overall Board effectiveness. The above criteria are based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 5, 2017.
The Independent Directors had a separate meeting held on 28th March 2023. No Directors other than Independent Directors attended this meeting. Independent Directors discussed inter-alia the performance of Non-Independent Directors and Board as a whole and the performance of the Chairman of the Company after taking into consideration the views of Executive and Non- Executive Directors and expressed their satisfaction with the quality, quantity and timeliness of flow of information between the Company management and the Board.
The performance evaluation of all the Independent Directors has been done by the entire Board, excluding the Director being evaluated.
The Board was satisfied with the professional expertise and knowledge of each of its directors. All the Directors effectively contributed to the decision-making process by the Board. Further, all the Committees were duly constituted and were functioning effectively. The Board also expressed its satisfaction in relation to the provision of supporting documents to the Board enabling it to assess the policy & procedural requirements for the proper functioning of the Company. The Board expressed its satisfaction with the decision making and decision implementing procedure followed by it. The Directors express their satisfaction with the evaluation process.
Your Company has in place a policy known as âNomination & Remuneration Policyâ for selection and appointment of Directors, Senior Management, and their remuneration. The Policy includes criteria for determining qualification, positive attributes & independence. The Company aspires to pay performance linked remuneration to its WTDs/CMD. It is ensured that the remuneration is determined in such a way that there exists a balance between fixed and variable pay. The Policy of the Company on Nomination and Remuneration & Board Diversity is placed on the website of the Company at https://ptcindia.com/ wp-content/uploads/2019/07/Policy-on-Nomination-and-Remuneration-Board-Diversity-Policy.pdf
There was no change carried out in the policy during the year under review.
VIGIL MECHANISM/WHISTLE BLOWER POLICY
Your Company believes in the conduct of the affairs of its constituents in a fair and transparent manner by adopting highest standards of professionalism, honesty, integrity, and ethical behavior. In compliance with requirements of Act & Listing Regulations, the Company has established a mechanism under its Whistle Blower Policy for employees to report to the management instances of unethical behavior, actual or suspected, fraud or violation of the Companyâs code of conduct or ethics policy. Whistleblowing is the confidential disclosure by an individual of any concern encountered in the workplace relating to a perceived wrongdoing. The policy has been framed to enforce controls so as to provide a system of detection, reporting, prevention and appropriate dealing of issues relating to fraud, unethical behavior etc. The policy provides for adequate safeguards against victimization of director(s) / employee(s) who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee in exceptional cases. During the year under review, no complaints were received by the Board or Audit Committee.
The whistle blower policy of the Company is available at the link https:// ptcindia.com/wp-content/uploads/2019/07/Whistle-Blower-Policy.pdf
CORPORATE SOCIAL RESPONSIBILITY
As a responsible corporate citizen, PTC India Limited (PTC) is committed to ensure its contribution to the welfare of the communities in the society where it operates, through its various Corporate Social Responsibility (âCSRâ) initiatives.
The objective of PTCâs CSR Policy is to consistently pursue the concept of integrated development of the society in an economically, socially and environmentally sustainable manner and at the same time recognize the interests of all its stakeholders. In order to accomplish this objective professionally, the Company has formed a Trust named the PTC Foundation Trust (PFT) for execution of the CSR initiatives of the Company. The Company has adopted a new CSR policy during the year under review.
To attain its CSR objectives in a professional and integrated manner, PTC shall undertake the CSR activities as specified under the Act.
Currently, the CSR Committee consists of Shri Devendra Swaroop Saksena, Independent Director, Shri Ramesh Narain Misra, Independent Director, Ms. Sangeeta Kaushik, Non-Executive Nominee Director and Shri Mahendra Kumar Gupta, Non-Executive Nominee Director.
There has been no change in the CSR Policy during FY 23. The CSR Policy is available at the link: https://ptcindia.com/wp-content/uploads/2019/07/ corporate-social-responsibility-policy.pdf
Further, the Annual Report on CSR Activities/ Initiatives including all requisite details is annexed with this report at Annexure 2.
Your Company has developed and implemented a risk management framework that includes the identification of elements of risk which in the opinion of the Board may threaten the existence of the Company. A Risk Management Policy has been adopted. The main objective of this policy is to ensure sustainable business growth with stability and to promote a proactive approach in evaluating, resolving and reporting risks associated with the business. In order to achieve the key objective, the policy establishes a structured and disciplined approach to Risk Management, including the development of a Risk Matrix for each business. Tools like the Risk Matrix will guide decisions on risk related issues. Shri Rajiv Malhotra is the Chief Risk Officer (CRO).
BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT
As stipulated under the Listing Regulations, the Business Responsibility and Sustainability Report, describing the initiatives taken by the Company from environmental, social and governance perspective forms part of this Annual Report.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENT U/S 186
Details of loans, guarantees and investments covered under Section 186 of the Act including purpose thereof form part of the notes to the financial statements provided in this Annual Report.
In accordance with the provisions of section 92(3) and 134 (3)(a) of the Act, the Annual Return of the Company is available at: https://www.ptcindia.com/wp-content/uploads/2023/08/PTC Annual Return FY 2022-23.pdf
M/s T.R. Chadha & Co. LLP., Chartered Accountants, were appointed as Statutory Auditors of your Company in the 22nd Annual General Meeting of the Company for a period of five years till conclusion of 27th Annual General Meeting of the Company to be held in year 2026.
The Statutory Auditors have audited the financial statements of the Company for the financial year ended 31st March 2023 and the same is being placed before members at the ensuing Annual General Meeting for their approval.
The Standalone Auditorsâ Report for FY 2022-23 is self- explanatory and does not contain any qualification, reservation or adverse remark. The Auditorsâ Report is enclosed with the financial statements in this Annual Report.
During the period under review, no incident of fraud was reported by the Auditors pursuant to Section 143(12) of the Companies Act 2013.
M/s. Ravi Rajan & Co., the existing Internal Auditors were appointed in FY 2021-22 for a tenure of three financial years up to FY 2023-24. Reports for the year were submitted to the Audit Committee & Board.
Cost audit is not applicable to the Company.
As required under Section 204 of the Act and Rules made there under, the Board has appointed M/s. Agarwal S. & Associates, Company Secretaries as secretarial auditor of the Company for the financial year 2022-23.
The Secretarial Audit Report for FY 2022-23 does not contain any qualification, reservation or adverse remark except the following: -
1. Non-Compliance with the provision of section 149 of the companies Act, 2013 and Regulation 17(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015- The Board of Directors of the Company was not duly constituted from 5th of December 2022 till 31st March, 2023.
2. Non-Compliance with the Regulation 33(3) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015- The standalone and consolidated financials for quarter ended 31st December 2021, 31st March 2022, 30th June, 2022 and 30th September, 2022 were not submitted in accordance with timeline given under Regulations 33(3) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
3. Non-Compliance with the Regulation 7(3) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015- Company has submitted the compliance certificate on 31st day from the end of the financial year.
4. Non-Compliance with Regulation 42 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015-Company served only five daysâ notice in advance against requirement
of at least seven working days (Excluding the date of intimation and the record date) to the stock exchange of the record date specifying the purpose of the record date.
5. Non-Compliance with Regulation 52 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015-Company had submitted unsigned Audit report for the financial year ended March, 31, 2022 on 05.07.2022 & signed Audit Report on 12.08.2022.
The NSE and BSE have levied monetary fines for non-compliances wherever applicable under Regulations of the Securities and Exchange Board of India (Listing Obligations and Disclosure requirements) Regulations, 2015 and same has been paid. The Board noted that comments on above are already mentioned in Annual Secretarial Compliance Report for FY 23 filed with NSE & BSE.
Further, the Secretarial Audit Report is annexed to the Boardâs Report at Annexure 3.
Further, the Secretarial Audit Report of PTC Energy Limited, unlisted subsidiary, is annexed to the Boardâs report at Annexure 4.
HUMAN RESOURCES
In any service industry, employees form the core of an organization. The management of your organization understands the importance of its core resource and invests a significant portion of its time in engaging, developing and retention of employees. Your Company is committed to and has always maintained gender diversity & equality in the organization. The employee engagement platform is framed on the objective of inclusiveness. Your Company encourages participation of employees in social activities and provides a healthy work environment wherein every employee can develop his/her own strengths and deliver expertise to achieve the overall objective of the organization.
Industrial relations - Healthy, cordial, and harmonious industrial relations are being always maintained at all levels by your Company.
CORPORATE GOVERNANCE
A separate report on corporate governance, along with a certificate from the Practicing Company Secretary regarding the compliance of conditions of corporate governance norms as stipulated under Listing Regulations is annexed and forms part of the Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis on matters related to the business performance as stipulated in the SEBI (LODR) Regulations, 2015 is given as a separate section in the Annual Report.
DOMESTIC POWER TRADING
Your Company has completed another significant year of its operations. In this financial year, the company has maintained its leadership position in the industry despite several changes in the market. Company has sustained consistent performance by maintaining continuous interactions with customers and providing innovative solutions. Your Company remains the front-runner in the power trading market.
PTC achieved the trading volume of 70,610 MUs during 2022-23 against the previous yearâs volume of 87,515 MUs. PTC achieved short-term trading volume of 37,697 MUs during 2022-23 (Previous year 51,934 MUs), which is due to reorientation of business model and ceding low margin power exchange volumes to avoid negative impact on cost of funds. Further, PTC has achieved long & medium-term trading volumes of 32,913 MUs against the previous yearâs volume of 35,581 MUs, which is primarily due to maturity of Pilot Scheme-1 under medium term. PTC managed to retain its leadership position in terms of the overall trading volumes in the power trading market.
PTCâs short term bilateral trade volumes were 8,198 MUs against the previous year figure of 7,300 MUs with a growth of 12.3% over previous year and power exchanges volumes during 2022-23 were 29,499 MUs against the previous year figure of 44,634 MUs.
PTC had sustained its presence in the portfolio management of power business for the utilities segment under various arrangements with government owned utilities. The arrangements mandate PTC for sale/purchase of power for the respective utilities under bilateral and power exchanges arrangements. PTC has also successfully ventured into the role of a holistic solutions provider by assisting utilities in their day to day demand - supply assessment, price forecasting, market assessment etc.
Long Term Agreements for Purchase of power POWER PURCHASE AGREEMENTS
PTC has in its portfolio Long-term Power Purchase Agreements (PPAs) with the generators for a cumulative capacity of around 10 GW for further sale of power to Discoms which includes Cross-Border power trade and most of them are already tied-up. The projects are based on domestic coal, imported coal, gas, hydro and renewable energy resources.
AGREEMENTS FOR SALE OF POWER
Earlier, TANGEDCO appointed PTC as an aggregator for procurement of power under medium term for 5 years. In the current financial year, PTC has signed agreements with TANGEDCO and the Selected Bidder for 102 MW of power. The power supply commenced in the current financial year.
The Pilot Scheme-II is operational with a part quantum of 420 MW and the balance quantum is expected to get operational in the current financial year.
CROSS BORDER POWER TRADE
In the current year, Cross-border trade with Bhutan witnessed a volume of 6,993 MUs. As a part of bi-directional trade, PTC has helped to enhance Bhutanâs power trade transactions on Indian Power Exchange(s) and has supplied 318.8 MUs to Bhutan in FY 2022-23 during the winter months as against 240.1 MUs in the previous year.
In addition, PTC has a long term power purchase agreement in place for 118 MW Nikah Hydroelectric Project in Bhutan. Power has been tied up on long term basis with the Assam State Utility. The project is expected to be commissioned and commence power supply in the next financial year.
PTC has supplied a total of 1657 MUs in FY 2022-23 to BPDB under the Longterm contract for 200 MW capacity as against 413 MUs in the previous year.
Cross-border transactions remain a vital part of our portfolio with a total volume of 8650 MUs as against 8283 MUs in the previous year and we expect to increase the transactions going forward.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS/OUTGO
In view of the nature of activities that are being carried on by the Company, the provisions of the Companies (Accounts) Rules, 2014 concerning conservation of energy are not applicable to the Company however, the Company is committed towards conservation of energy and climate action.
(A) Foreign exchange earnings and Outgo:
Information about the foreign exchange earnings and outgo, as required to be given under Section 134(3) (m) of the Act read with sub rule 3 of Rule 8 of the Companies (Accounts) Rules, 2014, is given as follows:
S. No. |
Particulars |
For the year ended 31.03.2023 |
1. |
Expenditure in Foreign Currency |
INR 2.59 Cr. |
2. |
Earning in Foreign Currency |
INR 1052.65 Cr. |
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5(1) and Rule 5(2)/ (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is attached to the Directorsâ Report at Annexure 5.
SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL), ACT 2013
Your Company has in place a Prevention of Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013. This policy may be accessed on the Companyâs website i.e., www.ptcindia.com.
Internal Complaints Committee has been set up as required under Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013, inter-alia, to redress complaints received regarding sexual harassment. All employees (permanent, Contractual, temporary, trainees) are covered under this policy. The Company has not received any sexual harassment complaints during the year 2021-
22/2022-23.
OTHER DISCLOSURES
I) SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
No significant or material orders were passed during the year under review by the Regulators or Courts or Tribunals which impact the going concern status and Companyâs operations in future.
ii) TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
Pursuant to the provisions of the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, the Company has already filed the necessary form and uploaded the details of unpaid and unclaimed amounts lying with the Company, as on the date of last AGM, with the Ministry of Corporate Affairs. During the period under review, the Company has transferred dividend of INR 26,68,070 which were unclaimed for seven years or more and lying in âUnpaid/ Unclaimed Dividend A/câ for such period to IEPF account. Further, 32,865 equity shares, in respect of which said unclaimed dividend has been transferred to IEPF account, have also been transferred to the IEPF account.
iii) DEPOSITS
Your Company has not accepted any deposits from public in terms of provisions of Companies Act, 2013. Thus, no disclosure is required relating to deposits under Chapter V of Companies Act, 2013.
iv) COMPLIANCE WITH SECRETARIAL STANDARD ON BOARD AND GENERAL MEETINGS
During the period under review, the Company has complied with the Secretarial Standards 1 & 2 as issued by the Institute of Company Secretaries of India.
GENERAL
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:
^ Issue of equity shares with differential rights as to dividend, voting or otherwise.
^ Issue of shares (including sweat equity shares) to employees of the Company under any scheme.
^ Neither Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.
Your Directors further state that there are no specific disclosures required under details of difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof.
Further, no application was filed under the Insolvency and Bankruptcy Code, 2016 during the year.
Statements in this âDirectorâs Reportâ & âManagement Discussion and Analysisâ describing the Companyâs objectives, projections, estimates, expectations or predictions may be forward looking statements within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companyâs operations including raw material/ fuel availability and its prices, cyclical demand and pricing in the Companyâs principal markets, changes in the Government regulations, tax regimes, economic developments within India and the Countries in which the Company conducts business and other ancillary factors.
APPRECIATION AND ACKNOWLEDGEMENT
The directors take this opportunity to express their deep sense of gratitude to the Promoters, Shareholders, Central and State Governments and their departments, Regulators, Central Electricity Authority, banks and the local authorities for their continued guidance and support.
Your directors would also like to record its appreciation for the support and cooperation your Company has been receiving from its clients and everyone associated with the Company.
Your directors place on record their sincere appreciation to the employees at all levels for their hard work, dedication and commitment. The enthusiasm and unstinting efforts of the employees have enabled the Company to remain as an industry leader.
And to you, our shareholders, we are deeply grateful for the confidence and faith that you have always reposed in us.
For and on behalf of the Board Sd/-
(Rajib Kumar Mishra)
Date: 12th August, 2023 Chairman & Managing Director
Place: New Delhi DIN: 06836268
Mar 31, 2022
The Board of Directors hereby submits the report of the business and operations of your Company (âthe Companyâ or âPTC India Limited/ PTCâ) along with the audited financial Statements of the Company and its subsidiaries for the financial year ended March 31, 2022.
The summarized standalone and consolidated results of your Company (along with its subsidiaries & associates) are given in the table below.
(in INR Crores) |
||||
Particulars |
Financial Year Ended |
|||
Standalone |
Consolidated |
|||
31/03/2022 |
31/03/2021 |
31/03/2022 |
31/03/2021 |
|
Total Income |
15637.62 |
16992.03 |
16,879.77 |
18373.66 |
Profit / (Loss) before Interest, Depreciation & Tax (PBITDA) excluding OCI & after minority interest) |
612.45 |
596.17 |
1,597.55 |
1,697.55 |
Finance Charges |
37.33 |
27.81 |
751.47 |
918.98 |
Depreciation |
3.74 |
2.79 |
101.32 |
100.01 |
Provision for Income Tax (including for earlier years) |
146.57 |
155.32 |
193.09 |
220.94 |
Net Profit / (Loss) after tax (after minority interest) |
424.81 |
410.25 |
551.67 |
457.62 |
Profit / (Loss) brought forward from previous year |
1044.11 |
979.16 |
1,294.94 |
1270.73 |
Amount transferred to General Reserve |
130.43 |
123.29 |
130.43 |
123.29 |
Dividend paid (including dividend tax) |
222.01 |
222.01 |
222.01 |
222.01 |
Transferred to special reserve |
30.87 |
|||
Transfer to impairment reserve |
95.37 |
45.03 |
||
Transferred to Statutory reserve |
16.90 |
3.33 |
||
Re-measurement of post-employment benefit obligations, net of tax |
(0.27) |
(0.08) |
||
Profit / (Loss) carried to Balance Sheet |
1116.48 |
1044.11 |
1,336.66 |
1294.94 |
Other comprehensive income /(Loss) (after minority interest) |
9.97 |
0.71 |
16.03 |
(3.55) |
Total comprehensive income (after minority interest) |
434.78 |
410.96 |
522.19 |
445.11 |
Note: The above statements and the financial figures given under the head âFinancial Resultsâ are extracted from the Standalone and Consolidated Financial Statements which have been prepared in accordance with the Indian Accounting Standards (Ind-AS) as notified under Section 133 of the Companies Act, 2013 (hereinafter referred as âthe Actâ), read with Companies (Indian Accounting Standards) Rules, 2015 and relevant amendment rules thereafter and other recognized accounting practices and policies, to the extent applicable.
RESULTS OF OPERATIONS AND STATE OF COMPANYâS AFFAIRS
The trading volumes were higher by 9% this year at 87,515 MUs as against 80,042 MUs during the previous year. With a turnover of INR 15637.62 Crores for the year 2021-22 as against 16992.03 Crores (including other income) in the Financial Year 2020-21, your Company has earned a Profit after Tax of INR 424.81 Crores as against INR 410.25 Crores in the previous year.
Your Company has two subsidiaries, namely PTC India Financial Services Limited (PFS) and PTC Energy Limited (PEL). The consolidated turnover (including other income) of the group is INR 16,879.77 Crores for the Financial Year 2021-22 as against INR 18,373.66 Crores (including other income) for the Financial Year 2020-21. The consolidated Profit after Tax of the group is INR 551.67 Crores for the Financial Year 2021-22 as against INR 457.62 Crores for the Financial Year 2020-21.
CONSOLIDATED FINANCIAL STATEMENTS
The Company adopted Indian Accounting Standard (Ind-AS) from April 1, 2016 and accordingly, the Consolidated Financial Statements have been prepared in accordance with the Accounting Standard notified under Section 133 of the Act (âActâ) and the relevant rules issued thereunder read with the SEBI (Listing
Obligations and Disclosure Requirements) Regulations 2015 (hereinafter referred as âListing Regulationsâ) and the other accounting principles generally accepted in India. The Consolidated Financial Statements form part of the Annual Report.
Out of the profits of the Company, a sum of INR 130.43 Crores has been transferred to General Reserves during the Financial Year and total reserves and surplus of the Company are INR 3618.90 Crores (including securities premium) as on 31st March 2022.
During the year, the Board of Directors of your Company in its meeting dated 11th November 2021 had declared 20% Interim Dividend i.e. '' 2 per equity share of INR 10 each. The Interim Dividend resulted in a cash outflow of INR 59.20 Crores.
The Board of Directors of your Company are pleased to recommend for your consideration and approval, a final dividend @ 58% for the Financial Year 2021-22 i.e., '' 5.80 per equity share of INR 10 each. The final dividend, if approved, at the ensuing Annual General Meeting (AGM) will result in a cash outflow of INR 171.69 Crores.
In pursuant to Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company in its Board Meeting held on 5th Feb., 2020 has adopted dividend distribution policy and the same is placed on the website of the Company and can be accessed through the following link:https://www.ptcindia.com/wp-content/uploads/2020/04/Dividend-Distribution-Policy.pdf
NET WORTH AND EARNINGS PER SHARE (EPS) ON A STANDALONE BASIS
As on 31st March. 2022, net worth of your Company was INR 3914-91 Crores as compared to INR 3702-14 Crores for the previous Financial Year thereby registering a growth of 6%.
EPS of the Company for the year ended 31st March 2022 stands at INR 14-35 in comparison to INR 13.86 for the Financial Year ended 31st March 2021-
MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There have been following material changes and commitments affecting the financial position of the Company which have occurred from the end of the Financial Year of the Company to which the financial statement relates i-e-31st March 2022 till the date of this report-
The Board in its meeting held on 31st May 2022 has approved additional issuance of corporate guarantee of INR 50 Crore (in addition of INR 225 Crore approved already). Subsequently, the Company has also executed additional corporate guarantee for INR 75 Crore (in addition of INR 200 Crore executed already) in favour of working capital lenders of PEL for the purpose of meeting additional working capital requirements of PEL.
The Company has acquired the energy consultancy business of IL&FS Energy Development Company Ltd. at a consideration of INR 14.90 Crore on
26.07.2022.
CHANGE IN THE NATURE OF BUSINESS, IF ANY
There is no change in the nature of business of your Company during the year under review.
During the period under review, no change has taken place with regard to capital structure of the Company.
As on 31st March 2022, PTC has an Authorized Share Capital of INR 750,00,00,000 and paid-up share capital of INR 296,00,83,210 divided into 29,60,08,321 equity shares of INR 10 each. The equity shares of your Company are listed on the âBSE Limitedâ (BSE) and âNational Stock Exchange of India Ltd.â (NSE). The promoters i.e. NTPC Ltd. (NTPC), Power Grid Corporation of India Ltd. (POWERGRID), Power Finance Corporation Ltd. (PFC) and NHPC Ltd. (NHPC) individually hold 4.05% each or 16.20% collectively of the paid-up and subscribed equity share capital of your Company and the balance of 83.80% of the paid-up and subscribed equity share capital of your Company is held by Power Sector Entities, Financial Institutions, Life Insurance Corporation of India, other Insurance Companies, Banking Institutions, Corporations, Investment Companies, Foreign Institutional Investors, Private Utilities and others including public at large.
HOLDING, SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES
Pursuant to sub-section (3) of section 129 of the Act, the statement containing the salient features of the financial statement of the Companyâs subsidiaries, associates and joint ventures entities given in Form AOC-1 is annexed to this report at Annexure 1. There has been no material change in the nature of the business of the subsidiaries and no company other than the specified ones under AOC-1 has ceased to be/became Subsidiary/ Associate of the Company.
The Company does not have any holding company.
Subsidiary CompaniesPTC India Financial Services Limited
PTC India Financial Services Limited (PFS) is a listed subsidiary of your Company wherein PTC holds a 64.99% stake and has invested INR 754.77 Crores. PFS is listed on NSE & BSE and has been classified as an Infrastructure Finance Company (IFC) by the Reserve Bank of India. PFS recorded total income of INR
968.74 Crores during FY 22 which is down by 14.98% as compared to last yearâs revenue of '' 1,139.45 Crores. Interest income for the FY22 has decreased to INR 924.69 Crores as against previous yearâs INR 1,105.25 Crores. The profit before tax and profit after tax for FY22 stood at Rs 173.91 Crores and INR 129.98 Crores respectively. Earnings per share for FY22 stood at INR 2.02 per share.
PTC Energy Limited (PEL)
PEL is a wholly owned subsidiary of your Company wherein PTC holds 100% stake and has invested INR 654.11 Crores. PEL has recorded revenue from operations of '' 280.67 Crores during FY 22 as compared to last yearâs revenue of INR 267.43 Crores. The profit/(loss) before tax and profit/(loss) after tax for FY22 stood at INR 0.17 Crores and INR (2.42) Crores respectively.
Investment in other companies (Amount released up to 31st March 2022)
⢠Your Company has invested INR 150 Crores in Athena Energy Ventures Private Limited (AEVPL). Since the projects of this Investee Company could not be commissioned in time and considering other related factors and fair value, there had been a reduction of INR 149.97 Crores towards the investment which had been accounted over the earlier years.
⢠Your Company had made an investment of INR 37.55 Crores in Krishna Godavari Power Utilities Limited. However, due to slow progress and other issues, provision was made for entire amount of INR 37.55 Crores during FY 2015-16.
⢠Teesta Urja Limited (TUL) has implemented a project of 1200 MW Teesta III Hydro Electric Project and the company initially invested a sum of INR 224.33 Crores in equity of TUL. The Company had divested part of its longterm investment in TUL so that Govt. of Sikkim could acquire 51% against its present holding of 26%. This disinvestment had been of 4,39,62,777 shares which reduced the shareholding of PTC to around 6.89%. Majority stake of TUL is held by Govt. of Sikkim (GoS) and the shareholding of PTC in TUL is now 6.89%. As on 31/03/2022, the Company has carried out fair valuation of investment in TUL and the same stood as INR 202.01 Crores as against INR 191.75 Crores of previous year.
⢠Your Company offered to sell its all shares of Chenab Valley Power Projects Private Limited to NHPC Limited at a value of INR 4.19 crores. NHPC Limited paid the entire consideration on May 25, 2021 and subsequently, the Company has handed over physical share certificates to NHPC Limited for transfer of shareholding in the name of NHPC Limited. However, the necessary formalities for such transfer are yet to be completed.
⢠Your Company has made an equity investment of INR 12.50 Crores during the FY 20 in a new entity i.e. Hindustan Power Exchange Limited (earlier named as Pranurja Solutions Limited) with other equity partners i.e. BSE investments Limited and ICICI Bank for development of a new Power Exchange. The company got its permit from CERC on 12th May 2021.
RELATED PARTY TRANSACTIONS
All contracts/ arrangements/ transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an armâs length basis and do not attract the provisions of Section 188 of the Act. During the year, the Company had not entered into any contract/ arrangement/ transaction with related parties which could be considered material in accordance with the policy of the company on materiality of related party transactions.
DIRECTORSâ RESPONSIBILITY STATEMENT
Pursuant to the requirements of clause (c) of sub-section (3) of Section 134 of the Act, the Board of Directors of your Company confirms that:
a. In the preparation of the annual accounts for the year ended March 31, 2022, the applicable accounting standards have been followed and there are no material departures from the same;
b. The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of the company as at March 31, 2022 and of the profit of the company for the year ended on that date;
c. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;
d. The Directors had prepared the annual accounts of the Company on a going concern basis;
e. The Directors had laid down the internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;
f. The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls with reference to financial statements. The Board has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Companyâs policies, safeguarding of its assets, the prevention of and detection of fraud and errors, the accuracy & completeness of the accounting records and the timely preparation of reliable financial disclosures.
The Company had appointed M/s Ernst & Young for the above purpose.
APPOINTMENT/ RE-APPOINTMENT OF DIRECTORS AND KEY MANAGERIAL PERSONNEL AND RESIGNATIONS/ COMPLETION OF TENURES BY THE DIRECTORS AND KEY MANAGERIAL PERSONNEL
During the Financial Year 2021-22, there were following changes in the composition of Board of Directors of the Company:
Sr. No. |
Name of Director |
Joining/ Cessation |
Date of joining/ Cessation |
1 |
Shri Deepak Amitabh |
Cessation |
November 05, 2021 |
2 |
Shri Ajit Kumar |
Cessation |
April 08, 2021 |
3 |
Shri Mritunjay Kumar Narayan |
Cessation |
December 07, 2021 |
4 |
Ms. Renu Narang |
Cessation |
February 16, 2022 |
5 |
Shri Anil Kumar Gautam |
Cessation |
June 17, 2021 |
6 |
Shri Vinod Kumar Maini |
Cessation |
January 01, 2022 |
7 |
Shri Harjeet Singh Puri |
Cessation |
July 15, 2021 |
8 |
Shri Himanshu Shekhar |
Appointment |
December 31, 2021 |
9 |
Shri Raghuraj Madhav Rajendran |
Appointment |
January 27, 2022 |
10 |
Ms. Sangeeta Kaushik |
Appointment |
February 18, 2022 |
11 |
Shri Rakesh Kacker |
Resignation |
January 21, 2022 |
12 |
Shri Devendra Swaroop Saksena |
Re-appointment |
July 30, 2021 |
13 |
Shri Vinod Kumar Maini |
Appointment |
July 26, 2021 |
14 |
Ms. Renu Narang |
Appointment |
June 17, 2021 |
As per the provisions of the Companies Act, Shri Rajib Kumar Mishra (DIN: 06836268) and Smt. Parminder Chopra (DIN: 08530587), Director would retire by rotation at the ensuing Annual General Meeting and being eligible has offered himself for re-appointment. The Board recommends his re-appointment.
DETAILS OF BOARD MEETINGS
During the financial year ended 31st March 2022, the Board met eleven (11) times. The details of Board meetings are mentioned in Corporate Governance Report as annexed with this report. The intervening gap between any two meetings was within the period prescribed by the Act and Listing Regulations.
For further details in respect of Composition, number and attendance of each director in various Committees of Board as required in accordance with Secretarial Standard-1 on Board Meetings and Listing Regulations, please refer to the Corporate Governance Report of this Annual Report.
As on March 31, 2022, the Board had all Statutory Committees i.e. the Audit Committee, the Nomination & Remuneration Committee, the Corporate Social Responsibility Committee, the Stakeholders Relationship Committee, Risk Management Committee and other Committees of Group of Directors formed from time to time for specific purposes. The full details are available in the Corporate Governance Report.
The Company has duly constituted an Audit Committee, whose detailed composition and powers are provided in the Corporate Governance Report. There were no recommendations of the Audit Committee which have not been accepted by the Board during the financial year.
DECLARATION BY INDEPENDENT DIRECTORS
The Company has received necessary declaration from each independent director under Section 149(7) of the Act, that he/she meets the criteria of independence laid down in Section 149(6) of the Act and Regulation 25 of the Listing Regulation. The Independent Directors have also confirmed that they have complied with the Companyâs code of conduct for Directors and Senior Management Personnel.
All the Independent Directors of the Company have registered themselves in the data bank maintained with the Indian Institute of Corporate Affairs, Manesar (âIICAâ). In terms of Section 150 of the Act read with Rule 6(4) of the Companies (Appointment & Qualification of Directors) Rules, 2014, the Independent Directors are required to undertake online proficiency self-assessment test conducted by the IICA. The Independent Directors, whosoever is required, shall undertake the said proficiency test.
In the opinion of the Board all independent directors possess strong sense of integrity and having requisite experience, qualification and expertise and are independent of the management. For further details, please refer Corporate Governance report.
The performance evaluation process and related tools are reviewed by the âNomination & Remuneration Committeeâ on a need basis, and the Committee may periodically seek independent external advice in relation to the process. The Committee may amend the Policy, if required, to ascertain its appropriateness as per the needs of the Company from time to time.
The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual directors, which includes criteria for performance evaluation of the non-executive and executive directors. The overall effectiveness of the Board is measured on the basis of the ratings obtained by each Director and accordingly the Board decides the Appointments, Re-appointments and Removal of the non-performing Directors of the Company. On the basis of Policy for Performance Evaluation of Independent Directors, a process of evaluation is being followed by the Board for its own performance and that of its Committees and individual Directors.
The exercise was carried through a structured evaluation process covering various aspects of the Board including committees and every Directors functioning such as composition of Board and committees, experience and competencies, performance of specific duties and obligations, governance issues, etc. A questionnaire formed key part of the evaluation process for reviewing the functioning and effectiveness of the Board.
Board members had submitted their response for evaluating the entire Board, respective committees of which they are members and of their peer Board members, including Chairman of the Board.
The evaluation process focused on various aspects of the Board and Committees functioning such as structure, composition, quality, board meeting practices and overall Board effectiveness. The above criteria are based on the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 5, 2017.
The Independent Directors had a separate meeting held on 16th September 2021. No Directors other than Independent Directors had attended this meeting. Independent Directors discussed inter-alia the performance of Non-Independent Directors and Board as a whole and the performance of the Chairman of the Company after taking into consideration the views of Executive and NonExecutive Directors and took note of the quality, quantity and timeliness of flow of information between the company management and the Board.
The performance evaluation of all the Independent Directors have been done by the entire Board, excluding the Director being evaluated. On the basis of performance evaluation done by the Board, it shall be determined whether to extend or continue their term of appointment, whenever the respective term expires.
The Board was satisfied with the professional expertise and knowledge of each of its Directors. All the Directors effectively contributed to the decision making process by the Board. Further, all the Committees were duly constituted and were functioning effectively. The Board also expressed its satisfaction in relation to the provision of supporting documents to the Board enabling it to assess the policy & procedural requirements for proper functioning of the Company. The Board expressed its satisfaction with the decision making and decision implementing procedure followed by it. The Directors express their satisfaction with the evaluation process.
Your Company has in place a policy known as âNomination & Remuneration Policyâ for selection and appointment of Directors, Senior Management, and their remuneration. The Policy includes criteria for determining qualification, positive attributes & independence. The Company aspires to pay performance linked remuneration to its WTDs/CMD. It is ensured that the remuneration is determined in a way that there exists a fine balance between fixed and variable pay. The Policy of the Company on Nomination and Remuneration & Board Diversity is placed on the website of the Company at https://ptcindia.com/ wp-content/uploads/2019/07/Policy-on-Nomination-and-Remuneration-Board-Diversity-Policy.pdf
There was no change carried in the policy during year under review.
VIGIL MECHANISM/WHISTLE BLOWER POLICY
Your Company believes in the conduct of the affairs of its constituents in a fair and transparent manner by adopting highest standards of professionalism, honesty, integrity, and ethical behavior. In compliance with requirements of Act & Listing Regulations, the Company has established a mechanism under its Whistle Blower Policy for employees to report to the management instances of unethical behavior, actual or suspected, fraud or violation of the Companyâs code of conduct or ethics policy. Whistleblowing is the confidential disclosure by an individual of any concern encountered in the workplace relating to a perceived wrongdoing. The policy has been framed to enforce controls so as to provide a system of detection, reporting, prevention and appropriate dealing of issues relating to fraud, unethical behavior etc. The policy provides for adequate safeguards against victimization of director(s) / employee(s) who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee in exceptional cases. During the year under review, no complaints were received by the Board or Audit Committee.
The whistle blower policy of the Company is available at the link https://ptcindia.com/wp-content/uploads/2019/07/Whistle-Blower-Policy.pdf
CORPORATE SOCIAL RESPONSIBILITY
As a responsible corporate citizen, PTC India Limited (PTC) is committed to ensure its contribution to the welfare of the communities in the society where it operates, through its various Corporate Social Responsibility (âCSRâ) initiatives.
The objective of PTCâs CSR Policy is to consistently pursue the concept of integrated development of the society in an economically, socially and environmentally sustainable manner and at the same time recognize the interests of all its stakeholders. In order to accomplish this objective professionally, the Company has formed a Trust named the PTC Foundation Trust (PFT) for execution of the CSR initiatives of the Company. The Company has adopted a new CSR policy during year under review.
To attain its CSR objectives in a professional and integrated manner, PTC shall undertake the CSR activities as specified under the Act.
Currently, the composition of the CSR Committee consists of Shri Devendra Swaroop Saksena, Independent Director, Shri Ramesh Narain Misra, Independent Director and Shri Vinod Kumar Singh, Non-Executive Nominee Director and Ms. Sangeeta Kaushik, Non-Executive Nominee Director.
The CSR Policy is available at the link: https://ptcindia.com/wp-content/ uploads/2019/07/corporate-social-responsibility-policy.pdf
Further, the Annual Report on CSR Activities/ Initiatives including all requisite details is annexed with this report at Annexure 2.
Your Company has developed and implemented a risk management framework that includes the identification of elements of risk which in the opinion of the Board may threaten the existence of the Company. A group Risk Management Policy has been approved. The main objective of this policy is to ensure sustainable business growth with stability and to promote a proactive approach in evaluating, resolving and reporting risks associated with the business. In order to achieve the key objective, the policy establishes a structured and disciplined approach to Risk Management, including the development of a Risk Matrix for each business. Tools like the Risk Matrix will guide decisions on risk related issues. Shri Rajiv Malhotra is the Group Chief Risk Officer (CRO).
BUSINESS RESPONSIBILITY REPORT
As stipulated under the Listing Regulations, the Business Responsibility Report, describing the initiatives taken by the Company from environmental, social and governance perspective forms part of this Annual Report.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENT U/S 186
Details of loans, guarantees and investments covered under Section 186 of the Act form part of the notes to the financial statements provided in this Annual Report.
In accordance with the provisions of section 92(3) and 134 (3)(a) of the Act, the Annual Return of the Company is available at: https://www.ptcindia.com/wp-content/uploads/2022/11/PTC Annual Return FY 2021-22.pdf
M/s T.R. Chadha & Co. LLP, Chartered Accountants (ICAI Registration no. 006711N/N500028), B-30, Connaught Place, Kuthiala Building, New Delhi-110001, were appointed as the Statutory Auditor of the Company, in place of M/s K.G. Somani & Co., Chartered Accountants, retiring Statutory Auditors of the Company, for a period of 5 years till the conclusion of AGM of 2026 of the Company at a remuneration of INR 12,25,000/ (Rupees Twelve Lakhs Twenty Five Thousand only) to conduct the audit from FY 2021-22 payable in one or more instalments plus applicable tax. The remuneration for subsequent years i.e. from FY 2022-23 to FY 2025-26 may be determined by the Board of Directors of the Company from time to time on the recommendation of the Audit Committee.
The Statutory Auditors have audited the financial statements of the Company for the financial year ended 31st March 2022 and the same is being placed before members at the ensuing Annual General Meeting for their approval.
The Standalone Auditorsâ Report for FY 2021-22 is self- explanatory and does not contain any qualification, reservation or adverse remark. The Statutory Auditors of PFS has given a qualified opinion on its financial results. PFS being a material subsidiary, the Statutory Auditors of the Company has also given a
qualified report on Consolidated Financial results of Company on similar lines. The Auditorsâ Reports are enclosed with the financial statements in this Annual Report.
During the period under review, no incident of fraud was reported by the Statutory Auditors pursuant to Section 143(12) of the Companies Act 2013.
M/s. Ravi Rajan & Co., the existing Internal Auditors has a tenure of three financial years upto FY 2023-24. Reports for the year were submitted to the Audit Committee & Board.
Cost audit is not applicable to the Company.
As required under Section 204 of the Act and Rules made there under, the Board has appointed M/s. Agarwal S. Associates, Practicing Company Secretaries as secretarial auditor of the Company for the financial year 2021-22.
The Secretarial Audit Report for FY 2021-22 does not contain any qualification, reservation or adverse remark except those mentioned in their report.
In this connection this is to clarify that the vacancy arose in the office of independent director on 20th Decâ20 which was not filled within the statutory period of 3 months i.e. up to 19th Marâ21. One of the whole-time director of the company attained the superannuation and retired on 7th April, 2021, which made the composition of the Board of Directors of the Company in compliance with the terms of Listing Regulations w.e.f. 8th April, 2021.
The NSE and BSE have levied monetary fine for non-compliance under Regulation 33 of the Securities and Exchange Board of India (Listing Obligations and Disclosure requirements) Regulations, 2015 for the quarter ended December, 2021.
Further, the Secretarial Audit Report is annexed to the Boardâs Report at
Further, the Secretarial Audit Report of PTC Energy Limited, unlisted subsidiary, is annexed to Boardâs report at Annexure 4.
Your Board hereby affirms that it gives immense importance to the Corporate Governance norms issued by the SEBI in the Listing Regulations and always endeavors to achieve the highest standard of Governance in the Company.
In any service industry, employees form the core of an organization. The management of your organization understands the importance of its core resource and invests a significant portion of its time in engaging, developing and retention of employees. Your Company is committed to and has always maintained gender diversity & equality in the organization. The employee engagement platform is framed on the objective of inclusiveness. The company encourages participation of employees in social activities and to provide healthy work environment wherein every employee can develop his/her own strengths and deliver expertise to achieve the overall objective of the organization.
Industrial relations - Healthy, cordial, and harmonious industrial relations are being maintained at all times and all levels by your Company.
A separate report on corporate governance, along with a certificate from the Practicing Company Secretary regarding the compliance of conditions of corporate governance norms as stipulated under Listing Regulations is annexed and forms part of the Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis on matters related to the business performance as stipulated in the SEBI (LODR) Regulations, 2015 is given as a separate section in the Annual Report.
Your Company has completed another significant year of its operations. In this financial year, PTC has been appointed as an aggregator by TANGEDCO for procurement of power under medium term. In this financial year, the company has maintained its leadership position in the industry by registering growth in trading volumes w.r.t. previous year despite several changes in the market. Volumes of the Company have grown by maintaining continuous interactions with customers, providing innovative solutions and managing the key power portfolios of some states. Your Company remains the front runner in the power trading market.
PTC has achieved the highest trading volume of 87,515 MUs during 2021-22 against the previous yearâs volume of 80,042 MUs with an annualized growth of around 9.34%. PTC achieved short-term trading volume of 51,934 MUs (Previous year 40,070 MUs) during 2021-22 with a growth of around 29.6% over the previous year. Further, PTC has achieved long & medium-term trading volumes 35,569 MUs. PTC managed to retain its leadership position in terms of the overall trading volumes in the power trading market.
PTCâs volume on power exchanges during 2021-22 reached 44,634 MUs against the previous year figure of 34,536 MUs which has seen an increase of around 29.24% over the previous year. Due to Covid affected demand volatility, higher traded volume through exchange was witnessed.
PTC had sustained its presence in the portfolio management of power business for the utilities segment under various arrangements with government owned utilities. The arrangements mandate PTC for sale / purchase of power for the respective utilities under bilateral, power exchanges and banking arrangements. PTC has also successfully ventured into the role of a holistic solution provider by assisting utilities in their day to day demand- supply assessment, price forecasting, market assessment and optimizing the overall power portfolio of the state.
Long Term Agreements for Purchase of powerPOWER PURCHASE AGREEMENTS
PTC has in its portfolio Long-term Power Purchase Agreements (PPAs) with the generators for a cumulative capacity of around 10 GW for further sale of power to Discoms which includes Cross-Border power trade and most of them are already tied-up. The projects are based on domestic coal, imported coal, gas, hydro and renewable energy resources.
Earlier, PTC has been selected as an aggregator by the PFC Consulting (Nodal Agency) under the Pilot Scheme-II of Central Government for procurement of power by Distribution Licensees (Discoms) from coal based thermal power plants for a period of three (3) years under Medium-term. In the current financial year, PTC as an aggregator had signed the Agreements for Procurement of Power with successful bidders and back to back Power Supply Agreements with the Distribution Licensees for available capacity of 820 MW. The power supply for part capacity has already commenced in the current financial year.
In the current financial year, TANGEDCO has appointed PTC as an aggregator for procurement of 1500 MW power under medium term for 5 years Subsequently, TANGEDCO had conducted the competitive bidding process on 09.02.2022 and four generators with aggregate quantum of 627 MW have been declared as successful bidders and LOAs have been placed.
The Pilot Scheme-I got operational with a total quantum of 1900 MW being supplied from 7 generators and tied up with 5 State Discoms. The scheme will complete its tenure in phases up to December 2022.
In the current year, Cross-border trade with Bhutan witnessed a volume of 7676 MUs inclusive of first power trade transaction of 240.1 MUs to Bhutan during the winter months on an Indian Power Exchange. Also, Trade with Nepal witnessed a volume of 194.90 MUs.
In the current year, PTC has conducted Bhutanâs first power trade transaction on an Indian Power Exchange and has supplied 240.1 MUs to Bhutan in FY 2021-22 during the winter months.
PTC has supplied a total of 412.55 MUs in FY 2021-22 to BPDB under the Longterm contract for 200 MW capacity.
Cross-border transactions remain a vital part of our portfolio with total volume of 8283.5 MUs and we expect to increase the transactions going forward.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS/OUTGO
The particulars relating to conservation of energy, technology absorption are not applicable.
(A) Foreign exchange earnings and Outgo:
Information about the foreign exchange earnings and outgo, as required to be given under Section 134(3) (m) of the Act read with sub rule 3 of Rule 8 of the Companies (Accounts) Rules, 2014, is given as follows:
S. No. |
Particulars |
For the year ended 31.03.2022 |
1. |
Expenditure in Foreign Currency |
INR 1.00 Cr. |
2. |
Earning in Foreign Currency |
INR 218.48 Cr. |
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5(1) and Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is attached to the Directorsâ Report at Annexure 5.
SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL), ACT 2013
Your Company has in place a Prevention of Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013. This policy may be accessed on the Companyâs website i.e. www.ptcindia.com .
Internal Complaints Committee has been set up as required under Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013, inter-alia, to redress complaints received regarding sexual harassment. All employees (permanent, Contractual, temporary, trainees) are covered under this policy. The Company has not received any sexual harassment complaints during the year 2020-21/ 2021-22.
OTHER DISCLOSURES
i) SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
No significant or material orders were passed during the year under review by the Regulators or Courts or Tribunals which impact the going concern status and Companyâs operations in future.
ii) TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
Pursuant to the provisions of the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, the
Company has already filed the necessary form and uploaded the details of unpaid and unclaimed amounts lying with the Company, as on the date of last AGM, with the Ministry of Corporate Affairs. During the period under review, the Company has transferred dividend of INR 17,65,660 which were unclaimed for seven years or more and lying in âunpaid/ unclaimed dividend A/câ for such period to IEPF account. Further, 11,592 equity shares, in respect of which said unclaimed dividend has been transferred to IEPF account, have also been transferred to the IEPF account.
iii) DEPOSITS
Your Company has not accepted any deposits from public in terms of provisions of Companies Act, 2013. Thus, no disclosure is required relating to deposits under Chapter V of Companies Act, 2013.
iv) COMPLIANCE WITH SECRETARIAL STANDARD ON BOARD AND GENERAL MEETINGS
During the period under review, the Company has complied with the Secretarial Standards 1 & 2 as issued by the Institute of Company Secretaries of India.
GENERAL
Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:
^ Issue of equity shares with differential rights as to dividend, voting or
otherwise.
^ Issue of shares (including sweat equity shares) to employees of the Company
under any scheme.
^ Neither Managing Director nor the Whole-time Directors of the Company
receive any remuneration or commission from any of its subsidiaries.
Your Directors further state that there are no specific disclosures required under details of difference between amount of the valuation done at the time of one-time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof.
Further, no application was filed under the Insolvency and Bankruptcy Code, 2016 during the year.
CAUTIONARY STATEMENT
Statements in this âDirectorâs Reportâ & âManagement Discussion and Analysisâ describing the Companyâs objectives, projections, estimates, expectations or predictions may be forward looking statements within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companyâs operations including raw material/ fuel availability and its prices, cyclical demand and pricing in the Companyâs principal markets, changes in the Government regulations, tax regimes, economic developments within India and the Countries in which the Company conducts business and other ancillary factors.
APPRECIATION AND ACKNOWLEDGEMENT
The directors take this opportunity to express their deep sense of gratitude to the Promoters, Shareholders, Central and State Governments and their departments, Regulators, Central Electricity Authority, banks and the local authorities for their continued guidance and support.
Your directors would also like to record its appreciation for the support and cooperation your Company has been receiving from its clients and everyone associated with the Company.
Your directors place on record their sincere appreciation to the employees at all levels for their hard work, dedication and commitment. The enthusiasm and unstinting efforts of the employees have enabled the Company to remain as an industry leader.
And to you, our shareholders, we are deeply grateful for the confidence and faith that you have always reposed in us.
For and on behalf of the Board
Sd/-
(Rajib Kumar Mishra)
Date: 6th Dec., 2022 Chairman & Managing Director (Addl. Charge)
Place: New Delhi. DIN: 06836268
Mar 31, 2018
Dear Members,
The Board of Directors hereby submits the report of the business and operations of your Company (âthe Companyâ or âPTC India Limitedâ) along with the audited financial Statements of the Company and its subsidiaries for the financial year ended March 31, 2018.
FINANCIAL PERFORMANCE
The summarized standalone and consolidated results of your Company (and its subsidiaries) are given in the table below.
Rs. in Crore
Particulars |
Financial Year Ended |
|||
Standalone |
Consolidated |
|||
31/03/2018 |
31/03/2017 |
31/03/2018 |
31/03/2017 |
|
Total Income |
18,392.15 |
14,312.82 |
19,786.60 |
15513.47 |
Profit / (Loss) before Interest, Depreciation & Tax (EBITDA) excluding OCI & after minority interest) |
564.90 |
546.31 |
1,665.48 |
1592.82 |
Finance Charges |
117.28 |
134.59 |
944.37 |
799.73 |
Depreciation |
2.85 |
2.71 |
97.44 |
21.24 |
âProvision for Income Tax (including for earlier years)â |
125.57 |
118.14 |
219.70 |
266.04 |
Net Profit / (Loss) after tax (after minority interest) |
319.20 |
290.87 |
355.35 |
414.72 |
Profit / (loss) brought forward from previous year |
691.35 |
562.32 |
1,114.85 |
864.22 |
Amount transferred to General Reserve |
71.70 |
81.01 |
71.70 |
81.01 |
Dividend paid (including dividend tax) |
94.13 |
80.83 |
106.88 |
89.75 |
Transferred to special reserve |
- |
- |
41.35 |
46.08 |
Transferred to Statutory reserve |
- |
- |
3.21 |
44.89 |
Re-measurement of post-employment benefit obligation, net of tax |
- |
- |
0.10 |
0.04 |
Adjustment on consolidation |
- |
- |
- |
(31.82) |
Transferred from reserve for equity instrument through OCI |
- |
(65.86) |
||
Profit / (loss) carried to Balance Sheet |
844.72 |
691.35 |
1,246.96 |
1,114.85 |
Other comprehensive income (after minority interest) |
(80.21) |
(20.85) |
(157.99) |
(41.56) |
Total comprehensive income |
238.99 |
270.02 |
197.36 |
373.16 |
*previous year figures have been regrouped/rearranged wherever necessary.
RESULTS OF OPERATIONS AND STATE OF COMPANYâS AFFAIRS
The trading volumes were higher by 18% this year at 57018 MUs as against 48320 MUs during the previous year. With a turnover of Rs.18,392.15 Crore (including other income) for the year 2017-18 as against Rs.14312.82 Crore (including other income) in the Financial Year 2016-17, your Company has earned a Profit After Tax of Rs.319.20 Crore as against Rs.290.87 Crore in the previous year.
Your Company has two subsidiaries, namely PTC India Financial Services Limited (PFS) and PTC Energy Limited (PEL). The consolidated turnover of the group is Rs.19,786.60 Crore for the Financial Year 2017-18 as against Rs.15513.47 Crore for the Financial Year 2016-17. The consolidated Profit after Tax of the Group is Rs.355.35 Crore for the Financial Year 2017-18 as against Rs.414.72 crores for the Financial Year 2016-17.
RESERVES
Out of the profits of the Company, a sum of Rs.71.70 Crore has been transferred to General Reserves during the Financial Year and total reserves and surplus of the Company are Rs.2923.73 Crore (including securities premium) as on 31st March 2018.
DIVIDEND
The Board of Directors of your Company are pleased to recommend for your consideration and approval, a dividend @ 40% for the Financial Year 2017-18 i.e. Rs.4 per equity share of Rs.10 each. The dividend, if approved, at ensuing Annual General Meeting will absorb Rs.142.74 Crore including Dividend Distribution Tax amounting to Rs.24.34 Crore.
The dividend will be paid to the members whose names appear in the Register of Members as on a record date and in respect of shares held in dematerialized form whose names are furnished by National Securities Depositories Limited (NSDL) and Central Depository (India) Limited (CDSL) as beneficial owners as on record date.
NET WORTH AND EARNINGS PER SHARE (EPS)
As on 31st March 2018, net worth of your Company aggregates to Rs.3219.74 Crore as compared to Rs.3,074.88 Crore for the previous Financial Year thereby registering a growth of 4.71%.
EPS of the Company for the year ended 31st March, 2018 stands at Rs.10.78 in comparison to Rs.9.83 for the Financial Year ended 31st March, 2017.
MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There has been no material changes and commitments affecting the financial position of the Company which have occurred between the end of the Financial Year of the Company to which the financial statement relates (i.e. 31st March, 2018) and on the date of this report.
CHANGE IN THE NATURE OF BUSINESS, IF ANY
There is no change in the nature of business of your Company during the year under review.
CHANGES IN CAPITAL STRUCTURE
During the period under review, no change has taken place with regard to capital structure of the Company.
As on 31st March 2018, PTC has Authorized Share Capital of Rs.750, 00, 00,000 and paid-up share capital of Rs.296,00,83,210/- divided into 29,60,08,321 equity shares of â10 each. The equity shares of your Company are listed on the âBSE Limitedâ (BSE) and âNational Stock Exchange of India Ltd.â (NSE). The promoters i.e. NTPC Ltd. (NTPC), Power Grid Corporation of India Ltd. (POWERGRID), Power Finance Corporation Ltd. (PFC) and NHPC Ltd. (NHPC) individually hold 4.05% each or 16.20% collectively of the paid-up and subscribed equity share capital of your Company and the balance of 83.80% of the paid-up and subscribed equity share capital of your Company is held by Power Sector Entities, Financial Institutions, Life Insurance Corporation of India, other Insurance Companies, Banking Institutions, Corporations, Investment Companies, Foreign Institutional Investors, Private Utilities and others including public at large.
HOLDING, SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES
Pursuant to sub-section (3) of section 129 of the Companies Act, 2013 (âthe Actâ), the statement containing the salient features of the financial statement of a companyâs subsidiary or subsidiaries, associate company or companies and joint venture or ventures is given in Form AOC-1 as Annexure 1.
Holding Company
The Company does not have any holding company.
Subsidiary Companies
PTC India Financial Services Limited
PTC India Financial Services Limited (PFS) is a subsidiary of your Company wherein PTC holds 65% stake and invested Rs.754.77 crore. PFS is listed on NSE & BSE and has been classified as Infrastructure Finance Company (IFC) by the Reserve Bank of India. PFS recorded revenue of Rs.1,189.63 Crores during FY 18, which is lower by 11.93% as compared to last yearâs revenue of Rs.1,350.79 Crores. Last yearâs revenue includes Rs.147.15 Crores as profit on sale & dividend income from investment. Interest income for FY18 remained constant at Rs.1,112.75 Crores as against previous yearâs Rs.1,113.69 Crores. The profit before tax and profit after tax for FY18 stood at Rs.104.94 Crores and Rs.24.70 Crores respectively. Earnings per share for financial year stood at â0.38 per share.
PTC Energy Limited (PEL)
PEL is a wholly owned subsidiary of your Company wherein PTC holds 100% stake and invested Rs.654.12 crore. PEL has renewable energy portfolio of 288.8 MW consisting of 50 MW wind power projects in Madhya Pradesh, 50 MW wind power project in Karnataka and 188.8 MW wind power projects in Andhra Pradesh. During the year, PEL has recorded total income of Rs.281.75 crore (Previous year Rs.47.19 crore)
The Policy for Determining Material Subsidiaries as approved by the Board is available on the companyâs website at the link: http://ptcindia.com/statutory_ information/Policy-on-Determining-Material-Subsidiaries.pdf.
INVESTMENT IN OTHER COMPANIES (Amount released up to 31â March 2018)
- Your Company has executed Equity Subscription Agreement (ESA) for investment in Athena Energy Ventures Private Limited (AEVPL). PTC has released Rs.150 crore. The other investors in this Company are Athena Group. PTC has made a total provision of Rs.131.42 Crore towards the investment (Provision of Rs.32.55 Crore and Rs.98.87 Crore towards this investment were made during FY 2016-17 and FY 2017-18 respectively).
- Your Company had made an investment of Rs.37.55 crore in Krishna Godavari Power Utilities Limited. However, due to slow progress and other issues, provision was made for entire amount of Rs.37.55 Crores during FY 2015-16.
- Teesta Urja Limited (TUL) has implement a project of 1200 MW Teesta III Hydro Electric Project and the company invested a sum of Rs.224.33 crores in equity of TUL. Majority stake of TUL is held by Govt. of Sikkim (GoS) and the shareholding of PTC in TUL is 6.89%. As on 31/03/2018, the company has carried out fair valuation of investment in TUL and same stood as Rs.184.55 Crore as against Rs.165.65 Crore of previous year
- Your Company has equity in M/s. Chenab Valley Power Projects Private Limited (CVPPPL) with NHPC and JKSPDC and as of now PTC has released approx. Rs.4 Crores.
RELATED PARTY TRANSACTIONS
All contracts/ arrangements/ transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an armâs length basis and do not attract the provisions of Section 188 of the Companies Act, 2013. During the year, the Company had not entered into any contract/ arrangement/ transaction with related parties which could be considered material in accordance with the policy of the company on materiality of related party transactions.
The Policy on Materiality of Related Party Transactions and Dealing with Related Party Transactions as approved by the Board is available on the companyâs website at the link http://ptcindia.com/statutory_information/ Policy-on-materiality-of-Related-Party-Transactions-and-also-on-dealing-with-Related-Party-Transactions.pdf.
DIRECTORSâ RESPONSIBILITY STATEMENT
Pursuant to the requirements of clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, the Board of Directors of your Company confirms that:
a. In the preparation of the annual accounts for the year ended March 31, 2018, the applicable accounting standards have been followed and there are no material departures from the same;
b. The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as at March 31, 2018 and of the profit of the company for the year ended on that date;
c. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;
d. The Directors had prepared the annual accounts of the Company on a going concern basis;
e. The Directors had laid down the internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.
f. The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
CONSOLIDATED FINANCIAL STATEMENTS
The Company adopted Indian Accounting Standard (Ind-AS) from April 1, 2016 and accordingly, the Consolidated Financial Statements have been prepared in accordance with the Accounting Standard notified under Section 133 of the Companies Act, 2013 and the relevant rules issued thereunder read with the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 (âSEBI (LODR) Regulations, 2015â) and the other accounting principles generally accepted in India. The Consolidated Financial Statements form part of the Annual Report.
INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls with reference to financial statements. The Board has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Companyâs policies, safeguarding of its assets, the prevention of and detection of fraud and errors, the accuracy & completeness of the accounting records and the timely preparation of reliable financial disclosures.
The Company has appointed M/s. Grant Thornton for the above purpose.
DIRECTORS & KEY MANAGERIAL PERSONNEL RE - APPOINTMENT OF DIRECTORS
As per the provisions of the Companies Act, Shri Ravi P. Singh and Shri C. Gangopadhyay, Directors would retire by rotation at the ensuing Annual General Meeting and being eligible have offered themselves for re-appointment. The Board recommends their re-appointment.
RESIGNATIONS/ COMPLETION OF TENURES
- Shri Arun Kumar, Whole time Director has superannuated and ceased to be a Director w.e.f December 14, 2017.
- Shri Anil Razdan, Shri Dhirendra Swarup and Shri Harbans Lai Bajaj, Independent Directors had completed their tenure on January 08, 2018.
- Shri Kulamani Biswal has ceased to be the Nominee Director of NTPC w.e.f. December 19, 2017.
- Smt. Jyoti Arora, nominee ofMinistry ofPower, Government of India has completed her present tenure with Central Government and ceased to be a Director w.e.f. July 6, 2017.
- Shri K.P. Gupta has ceased to be the Nominee Director of NTPC w.e.f. July, 31, 2018.
APPOINTMENTS
- Appointment of Shri Arun Kumar Verma as nominee of Ministry of Power, Government of India effective from August 10, 2017.
- Appointment of Ms. Bharti Prasad and Ms. Sushama Nath as Independent Directors effective from December 20, 2017.
- Appointment of Shri Kalyan Prasad Gupta as Nominee of NTPC effective from January 01, 2018.
- Appointment of Shri Sutirtha Bhattachrya as an Independent Director effective from June 07, 2018.
- Appointment of Shri Devendra Swaroop Saksena as an Independent Director effective from July, 30, 2018.
- Appointment of Shri A.K. Gupta as Nominee of NTPC effective from August 7, 2018.
Further, Shri Pankaj Goel is CFO w.e.f. 21st April 2018.
DETAILS OF BOARD MEETINGS
The Board met six (6) times during the financial year ended on March 31, 2018. The intervening gap between any two meetings was within the period prescribed by the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as âListing Regulationsâ).
For further details in respect of Composition, number and attendance of each director in various Committees of Board as required in accordance with Secretarial Standard-1 on Board Meetings and Listing Regulations, please refer Corporate Governance Report of this Annual Report.
COMMITTEES OF THE BOARD
As on March 31, 2018, the Board had Committees i.e. the Audit Committee, the Nomination & Remuneration Committee, the Corporate Social Responsibility Committee, the Stakeholderâs Relationship Committee. The full details are available in Corporate Governance Report.
DECLARATION BY INDEPENDENT DIRECTORS
The Company has received necessary declaration from each independent director under Section 149(7) of the Companies Act, 2013, that he/she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 25 of the Listing Regulation.
FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS
The Familiarization Programme Module for Independent Directors is put up on the website of the Company at the link: http://ptcindia.com/statutory_ information/FAMILIARISATION-PROGRAMME-MODULE.pdf.
BOARD EVALUATION
The performance evaluation process and related tools are reviewed by the âNomination & Remuneration Committeeâ on need basis, and the Committee may periodically seek independent external advice in relation to the process. The Committee may amend the Policy, if required, to ascertain its appropriateness as per the needs of the Company from time to time.
The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual directors, which includes criteria for performance evaluation of the non-executive and executive directors. The overall effectiveness of the Board is measured on the basis of the ratings obtained by each Director and accordingly the Board decides the Appointments, Re-appointments and Removal of the non-performing Directors of the Company. On the basis of Policy for Performance Evaluation of Independent Directors, a process of evaluation is being followed by the Board for evaluating its own performance and that of its Committees and individual Directors.
REMUNERATION POLICY
Your Company has in place a policy known as âNomination & Remuneration Policyâ for selection and appointment of Directors, Senior Management and their remuneration. The Policy includes criteria for determining qualification, positive attributes & independence. The Company aspires to pay performance linked remuneration to its WTDs/CMD. It is ensured that the remuneration is determined in a way that there exists a fine balance between fixed and variable pay. The Policy of the Company on Nomination and Remuneration & Board Diversity is also placed on the website of the Company i.e. www.ptcindia.com and is also annexed to this report at Annexure 2.
VIGIL MECHANISM/WHISTLE BLOWER POLICY
Your Company believes in the conduct of the affairs of its constituents in a fair and transparent manner by adopting highest standards of professionalism, honesty, integrity and ethical behavior. In compliance with requirements of Companies Act, 2013 & Listing Regulations, the Company has established a mechanism under its Whistle Blower Policy for employees to report to the management instances of unethical behavior, actual or suspected, fraud or violation of the Companyâs code of conduct or ethics policy. Whistle blowing is the confidential disclosure by an individual of any concern encountered in the workplace relating to a perceived wrongdoing. The policy has been framed to enforce controls so as to provide a system of detection, reporting, prevention and appropriate dealing of issues relating to fraud, unethical behavior etc. The policy provides for adequate safeguards against victimization of director(s) / employee(s) who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee in exceptional cases. During the year under review, no complaints were received by the Board or Audit Committee.
The whistle blower policy of the Company is available at the link http://www. ptcindia.com/common/Whistle-Blower-Policy.pdf and is also annexed herewith as Annexure 3.
CORPORATE SOCIAL RESPONSIBILITY
As a responsible corporate citizen, PTC India Limited (PTC) is committed to ensure its contribution to the welfare of the communities in the society where it operates, through its various Corporate Social Responsibility (âCSRâ) initiatives.
The objective of PTCâs CSR Policy is to consistently pursue the concept of integrated development of the society in an economically, socially and environmentally sustainable manner and at the same time recognize the interests of all its stakeholders.
To attain its CSR objectives in a professional and integrated manner, PTC shall undertake the CSR activities as specified under the Act.
The composition of the CSR Committee consists of Smt. Bharti Prasad, Independent Director, Shri D.S. Saksena, Independent Director, Shri Chinmoy Gangopadhyay, Non- Executive Director and Shri Deepak Amitabh, Executive Director.
The CSR Policy is available at the link: http://www.ptcindia.com/pdf/corporate-social-responsibility-policy.pdf and the policy is also enclosed herewith as Annexure 4.
Further, the report on CSR Activities/ Initiatives is attached with this report at Annexure 5.
RISK MANAGEMENT POLICY
Your Company has developed and implemented a risk management framework that includes the identification of elements of risk which in the opinion of the Board may threaten the existence of the Company. A group Risk Management Policy has been approved. The main objective of this policy is to ensure sustainable business growth with stability and to promote a proactive approach in evaluating, resolving and reporting risks associated with the business. In order to achieve the key objective, the policy establishes a structured and disciplined approach to Risk Management, including the development of a Risk Matrix for each business. Tools like the Risk Matrix will guide decisions on risk related issues. Shri Rajiv Malhotra is Group Chief Risk Officer (CRO).
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENT U/S 186
Loans, guarantees and investments covered under Section 186 of the Companies Act, 2013 form part of the notes to the financial statements (Standalone) provided in this Annual Report.
EXTRACT OF ANNUAL RETURN
Pursuant to section 92(3) of the Companies Act, 2013 (âthe Actâ) and rule 12(1) of the Companies (Management and Administration) Rules, 2014, extract of annual return in Form MGT-9 is Annexed with this report at Annexure 6.
STATUTORY AUDITORS
M/s K.G. Somani & Co., Chartered Accountants, were appointed as Statutory Auditors of your Company in the 17th Annual General Meeting of the Company for a period of five years till conclusion of 22nd Annual General Meeting of the Company subject to the annual ratification in every Annual General Meeting. Now as per the Companies (Amendment) Act, 2017, the provisions of ratification of appointment of Statutory Auditor have been done away with and there is no requirement of ratification till the expiry of the term of the Statutory Auditor.
The Statutory Auditors have audited the Accounts of the Company for the financial year ended 31st March 2018 and the same is being placed before members at the ensuing Annual General Meeting for their approval.
The Auditorsâ Report for FY 2017-18 does not contain any qualification, reservation or adverse remark. The Auditorsâ Report is enclosed with the financial statements in this Annual Report.
During the period under review, no incident of fraud was reported by the Statutory Auditors pursuant to Section 143(12) of the Companies Act 2013.
INTERNAL AUDITORS
M/s. GSA Associates & Co., Chartered Accountants, New Delhi were appointed as Internal Auditors of the Company for the Financial Year 2017-18 and their reports for the year were submitted to the Audit Committee & Board.
COST AUDITORS
Cost audit is not applicable to the Company.
SECRETARIAL AUDITORS
As required under Section 204 of the Companies Act, 2013 and Rules made there under, the Board has appointed M/s. Agarwal S. Associates, Practicing Company Secretaries as secretarial auditor of the Company for the financial year 2017-18.
The Secretarial Audit Report for FY 2018 does not contain any qualification, reservation or adverse remark except that the composition of Board is not in line with SEBI regulations. The Secretarial Audit Report is enclosed to the Boardâs Report at Annexure 7.
Your Board hereby affirms that it gives immense importance to the Corporate Governance norms issued by the SEBI in the Listing Regulations, 2015 and always endeavor to achieve the highest standard of Governance in the Company. PTC India has complied with all the provisions of Corporate Governance norms except the composition of the Board of Directo is not in line with the SEBI regulations and the Board is in process to induct the required number of Independent Directors to comply with the said Regulations.
HUMAN RESOURCES
In any service enterprise, employees form the core of an organization. Your company recognizes the vitality of this stakeholder. A significant portion of management focus is invested in engaging, developing and on retention of employees. Your company also maintained gender diversity in the Organisation. The employee engagement platform are being framed on the objective of inclusiveness. The company encourages participation of employees in social activities and to provide healthy work environment wherein every employee can develop his/her own strength and deliver expertise to achieve the overall objective of the Organisation.
Industrial relations
Your company has always maintained healthy, cordial, and harmonious industrial relations at all levels.
CORPORATE GOVERNANCE
A separate report on corporate governance, along with a certificate from the Practicing Company Secretary in practice regarding the compliance of conditions of corporate governance norms as stipulated under SEBI (LODR) Regulations, 2015, given as a separate section in the Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis on matters related to the business performance as stipulated in the SEBI (LODR) Regulations, 2015 is given as a separate section in the Annual Report.
BUSINESS RESPONSIBILITY REPORT
As stipulated under the SEBI (Listing Obligation & Disclosure Requirement) Regulations, 2015, the Business Responsibility Report, describing the initiatives taken by the Company from environmental, social and governance perspective given as a separate section in the Annual Report.
Domestic Power Trading
Your Company has completed another significant year of its operations. The Financial year 2017-18 has been a year of growth towards addition of Renewable energy (i.e. Wind, Solar etc.) as Govt. of India has identified power sector as a key sector of focus so as to promote sustained industrial growth. The annual growth rate in renewable energy generation has been estimated to be 27% and 18% for conventional energy. In this financial year, the company has maintained its leadership position in the industry by registering substantial growth in trading volume w.r.t. previous year despite several changes in the market dynamics. Volumes of the company have grown by maintaining the continuous interaction with customers, providing innovative solutions and managing the key power portfolio of some states. Your Company remains the front runner in the power trading market.
PTC achieved the highest trading volume of 57018 MUs during 2017-18 against the previous yearâs figure of 48320 MUs with an annualized growth of 18% over the previous year. PTC achieved Short term trading volume of 10583 MUs (Previous year 7931 MUs) during 2017-18 with a growth of 33% over the previous year. Further, PTC has achieved Long & Medium term trading volume of 21361 MUs (Pervious year 16840 MUs) during 2017-18 with a growth of 27% over the previous year. PTC managed to retain its top position with the overall trading volumes considering overall trading business.
PTCâs volume on power exchanges during 2017-18 reached 20351 MUs against the previous year figure of 17965 MUs which has seen an increase of 13% over the previous year.
PTC had sustained its presence in the portfolio management of power business for the Utilities segment as it maintained agreement with Jharkhand Bijli Vitran Nigam Limited, Bihar State Power Holding Company Limited, Haryana Power Purchase Centre, Government of Himachal Pradesh and New Delhi Municipal Council. The arrangements mandate PTC for sale / purchase of power for the respective utilities under bilateral, power exchanges and banking arrangements.
Long Term Agreements for Purchase of power
(A) Commissioned Projects
i. Power Projects commissioned before FY 2017-18: The existing Long-Term arrangements where power supply commenced before FY 2017-18: 3251 MW
ii. Power Projects commissioned during FY 2017-18: The Long-term arrangements where power supply commenced during FY 2017-18: 443 MW
iii. Power Projects expected to be commissioned in FY 2018-19: Pipeline of projects with long term arrangements which would commence power supply in FY 2018-19: 1450 MW.
(B) Power Purchase Agreements
PTC has in its portfolio long term Power Purchase Agreements (PPAs) with the generators for a cumulative capacity of about 11401 MW for further sale of power to Discoms which includes Cross-Border power trade. The projects are based on domestic coal, imported coal, gas, hydro and renewable energy resources.
(C) Agreements for Sale of Power
PTC has participated in the tender invited by SECI in FY 2016-17 for selection of power trader for sale of wind power under the Ministry of New Renewable Energy scheme for 1000 MW ISTS connected wind power projects, wherein PTC emerged as the successful bidder and LOI was placed on PTC. Subsequently, PTC has successfully executed the PPA with Generators and PSA with seven Discoms in FY 2017-18 for the entire quantum of 1049.9 MW.
PTC has participated in 100 MW medium term bid invited by Noida Power Company Limited in FY 2017-18, wherein PTC has emerged as successful bidder for entire 100 MW capacity and PPA/PSA has been signed with Utility/Generator.
PTC has also signed PPA with Haryana Discoms in FY 2017-18 for sale of additional quantum of 176 MW on long term basis from Karcham Wangtoo H.E. Project and the power supply has also commenced in December, 2017.
PTC has been appointed as Aggregator and PFC Consulting has been appointed Nodal Agency under the Guidelines for Procurement for power under Pilot Scheme for medium term issued by Ministry of Power in April, 2018 to facilitate procurement of 2500 MW for 3 years from generating companies having commissioned coal based power plants. The Nodal Agency has initiated the competitive bidding process under the Pilot Scheme and PTC as an Aggregator will sign the Agreement for Procurement of power with successful bidders and back to back Power Supply Agreement with the Distribution Licensee(s).
Cross Border Power Trade
Cross-border trade with Bhutan witnessed 4710 MUs for FY 2017-18. Also, Trade with Nepal witnessed 65.39 MUs.
PTC has participated in the 500 MW long term and medium terms bids invited by Bangladesh in FY 2017-18, wherein PTC has emerged as successful bidder for 200 MW capacity each in both Long term and medium term bids and LOIs have been placed on PTC.
In addition to the above, PTC continues to supply 250 MW power to Bangladesh Power Development Board (BPDB) from West Bengal State Electricity Distribution Company Limited. Accordingly, volume for this transaction for FY 2017-18 was 1877.92 MUs. In addition to this, PTC is also supplying 40 MW power to BPDB on medium term basis through competitive bidding and has supplied 308.69 MUs in FY 2017-18. Accordingly, total volume for these transactions for FY 2017-18 was 2186.61 MUs as compared to 2018.13 MUs last year.
Cross-border transactions remain a vital part of our portfolio and we continue to see an increase in volumes in the next year also.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS/OUTGO
The particulars relating to conservation of energy, technology absorption, are not applicable.
FOREIGN EXCHANGE EARNINGS AND OUTGO
During the year, the total foreign exchange used was Rs.1.77 Crore (Exp.) and the total foreign exchange earned was Rs.1074.58 Crore.
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5(1) and Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is attached to the Directorsâ Report at Annexure 8.
SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL), ACT 2013
Your Company has in place a Prevention of Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013. This policy may be accessed on the Companyâs website i.e. www.ptcindia.com .
Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. All employees (permanent, Contractual, temporary, trainees) are covered under this policy. The Company has not received any sexual harassment complaints during the year 2017-18.
OTHER DISCLOSURES
i) SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
No significant or material orders were passed during the year under review by the Regulators or Courts or Tribunals which impact the going concern status and Companyâs operations in future.
ii) TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
Pursuant to the provisions of the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, the Company has already filed the necessary form and uploaded the details of unpaid and unclaimed amounts lying with the Company, as on the date of last AGM, with the Ministry of Corporate Affairs. During the period under review, the Company has transferred dividend of Rs.6,78,240/-which were unclaimed for seven years or more and lied in âunpaid/ unclaimed dividend A/câ for such period to IEPF account. Further, 39717 [numbers] equity shares, in respect of which said unclaimed dividend have been transferred to IEPF account.
iii) FIXED DEPOSITS
Your Company has not accepted any deposits from public in terms of provisions of Companies Act, 2013. Thus, no disclosure is required relating to deposits under Chapter V of Companies Act, 2013.
iv) Secretarial Standard
The Company has complied with the Secretarial Standards issued by the Institute of Company Secretaries of India during the period under review.
GENERAL
Your Directors state that no disclosure or reporting in respect of the following items is required as there were no transactions on these items during the year under review:
- Issue of equity shares with differential rights as to dividend, voting or otherwise.
- Issue of shares (including sweat equity shares) to employees of the Company under any scheme.
- Neither Managing Director nor the Whole time Directors of the Company receive any remuneration or commission from any of its subsidiaries.
CAUTIONARY STATEMENT
Statements in this âDirectorâs Reportâ & âManagement Discussion and Analysisâ describing the Companyâs objectives, projections, estimates, expectations or predictions may be forward looking statements within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make difference to the Companyâs operations including raw material/ fuel availability and its prices, cyclical demand and pricing in the Companyâs principal markets, changes in the Government regulations, tax regimes, economic developments within India and the Countries in which the Company conducts business and other ancillary factors.
APPRECIATION AND ACKNOWLEDGEMENT
The directors take this opportunity to express their deep sense of gratitude to the Promoters, Shareholders, Central and State Governments and their departments, Regulators, Central Electricity Authority, banks and the local authorities for their continued guidance and support.
Your directors would also like to record its appreciation for the support and cooperation your Company has been receiving from its clients and everyone associated with the Company.
Your directors place on record their sincere appreciation to the employees at all levels for their hard work, dedication and commitment. The enthusiasm and unstinting efforts of the employees have enabled the Company to remain as industry leader.
And to you, our shareholders, we are deeply grateful for the confidence and faith that you have always reposed in us.
For and on behalf of the Board
Sd/-
(Deepak Amitabh)
Place: New Delhi. (Chairman & Managing Director)
Date: 7th August, 2018 DIN: 01061535
Mar 31, 2017
Dear Members,
The Board of Directors hereby submits the report of the business and operations of your Company (âthe Companyâ or âPTC India Limitedâ) along with the audited financial Statements of the Company and its subsidiaries for the financial year ended March 31, 2017.
FINANCIAL PERFORMANCE
The summarized standalone and consolidated results of your Company (and its subsidiaries) are given in the table below.
Rs. in Crore
Particulars |
Financial Year Ended |
|||
Standalone |
Consolidated |
|||
31/03/2017 |
31/03/2016 |
31/03/2017 |
31/03/2016 |
|
Total Income |
14,312.82 |
12,660.09 |
15513.47 |
13601.02 |
Profit / (Loss) before Interest, Depreciation & Tax (EBITDA) excluding OCI & after minority interest) |
546.31 |
450.28 |
1592.80 |
1265.44 |
Finance Charges |
134.59 |
102.62 |
799.71 |
630.91 |
Depreciation |
2.71 |
3.53 |
21.24 |
10.15 |
Provision for Income Tax (including for earlier years) |
118.14 |
109.70 |
266.04 |
218.12 |
Net Profit / (Loss) after tax |
290.87 |
234.43 |
414.72 |
322.52 |
Profit / (loss) brought forward from previous year |
562.32 |
469.48 |
864.22 |
666.12 |
Amount transferred to General Reserve |
81.01 |
70.08 |
81.01 |
70.08 |
Dividend paid (including dividend tax) |
80.83 |
71.51 |
89.75 |
78.38 |
Transferred to special reserve |
- |
- |
46.08 |
34.98 |
Transferred to Statutory reserve |
- |
- |
44.89 |
46.93 |
Re-measurement of post-employment benefit obligation, net of tax |
- |
- |
0.04 |
0.04 |
Adjustment on consolidation |
- |
- |
(31.82) |
- |
Transferred from share options o/s accounts |
- |
- |
- |
(0.15) |
Transferred from reserve for equity instrument through OCI |
- |
- |
(65.86) |
(105.84) |
Profit / (loss) carried to Balance Sheet |
691.35 |
562.32 |
1,114.85 |
864.22 |
OCI (after minority interest) |
(20.85) |
0.03 |
(41.56) |
6.91 |
Total other comprehensive income (after minority interest) |
270.02 |
234.46 |
373.16 |
329.43 |
^previous year figures have been regrouped/rearranged wherever necessary.
RESULTS OF OPERATIONS AND STATE OF COMPANYâS AFFAIRS
The trading volumes were higher by 14.04% this year at 48320 MUs as against 42372 MUs during the previous year. With a turnover of Rs.14312.82 Crore (including other income) for the year 2016-17 as against Rs.12660.09 Crore (including other income) in the Financial Year 2015-16, your Company has earned a Profit After Tax of Rs.290.87 Crore as against Rs.234.43 Crore in the previous year.
Your Company has two subsidiaries, namely PTC India Financial Services Limited (PFS) and PTC Energy Limited (PEL). The consolidated turnover of the group is Rs.15513.47 Crore for the Financial Year 2016-17 as against Rs.13601.02 Crore for the Financial Year 2015-16. The consolidated Profit after Tax of the Group is Rs.414.72 Crore for the Financial Year 2016-17 as against Rs.322.52 for the Financial Year 2015-16.
RESERVES
Out of the profits of the Company, a sum of Rs.81.01 Crore has been transferred to General Reserves during the Financial Year and total reserves and surplus of the Company are Rs.2778.87 Crore (including securities premium) as on 31st March 2017.
DIVIDEND
The Board of Directors of your Company are pleased to recommend for your consideration and approval, a dividend @ 30% for the Financial Year 2016-17 i.e. Rs.3 per equity share of Rs.10 each. The dividend, if approved, at ensuing Annual General Meeting will absorb Rs.106.86 Crore including Dividend Distribution Tax amounting to Rs.18.06 Crore.
The dividend will be paid to the members whose names appear in the Register of Members as on a record date and in respect of shares held in dematerialized form whose names are furnished by National Securities Depositories Limited (NSDL) and Central Depository (India) Limited (CDSL) as beneficial owners as on record date.
NET WORTH AND EARNINGS PER SHARE (EPS)
As on 31st March 2017, net worth of your Company aggregates to Rs.3,074.88 Crore as compared to Rs.2,885.69 Crore for the previous Financial Year thereby registering a growth of 6.56%
EPS of the Company for the year ended 31st March, 2017 stands at Rs.9.83 in comparison to Rs.7.92 for the Financial Year ended 31st March, 2016.
MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY
There has been no material changes and commitments affecting the financial position of the Company which have occurred between the end of the Financial Year of the Company to which the financial statement relates (i.e. 31stMarch, 2017) and on the date of this report.
CHANGE IN THE NATURE OF BUSINESS, IF ANY
There is no change in the nature of business of your Company during the year under review.
CHANGES IN CAPITAL STRUCTURE
During the period under review, no change has taken place with regard to capital structure of the Company.
As on 31st March 2017, PTC has Authorized Share Capital of Rs.750, 00, 00,000 and paid-up share capital of Rs.296,00,83,210/- divided into 29,60,08,321 equity shares of Rs.10 each. The equity shares of your Company are listed on the âBSE Limited (BSE) and âNational Stock Exchange of India Ltd.â (NSE). The promoters i.e. NTPC Ltd. (NTPC), Power Grid Corporation of India Ltd. (POWERGRID), Power Finance Corporation Ltd. (PFC) and NHPC Ltd. (NHPC) individually hold 4.05% each or 16.20% collectively of the paid-up and subscribed equity share capital of your Company and the balance of 83.80% of the paid-up and subscribed equity share capital of your Company is held by Power Sector Entities, Financial Institutions, Life Insurance Corporation of India, other Insurance Companies, Banking Institutions, Corporations, Investment Companies, Foreign Institutional Investors, Private Utilities and others including public at large.
HOLDING, SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES
Pursuant to sub-section (3) of section 129 of the Companies Act, 2013 (âthe Actâ), the statement containing the salient features of the financial statement of a companyâs subsidiary or subsidiaries, associate company or companies and joint venture or ventures is given in Form AOC-1 as Annexure 1 .
Holding Company
The Company does not have any holding company.
Subsidiary Companies
PTC India Financial Services Limited
PTC India Financial Services Limited (PFS) is a subsidiary of PTC India Limited wherein PTC holds 65% stake and has invested Rs.754.77 Crore. PFS is listed on NSE and BSE and has been classified as Infrastructure Finance Company (IFC) by the Reserve Bank of India.
PFS has recorded revenue of Rs.1199.11 Crore during FY17 compared to revenue of Rs.971.72 Crore during FY16. Interest income for FY17 stood at Rs.1123.31 Crore compared to Rs.928 Crore during FY16, thus registering an increase of about 21.05%. The profit before tax and profit after tax for FY17 stood at Rs.406.52 Crore and Rs.260.18 Crore respectively. Net interest income increased to Rs.492.15, thereby recording a growth of over 15.55% during FY17.
The Board of Directors of PFS has recommended a dividend @ 15% i.e. Rs.1.5 per equity share of Rs.10/- each for the Financial Year 2016-17.
PTC Energy Limited
PTC Energy Limited (PEL) was set up as a subsidiary of PTC India Limited to develop asset base taking in to its sphere the developmental activities, fuel intermediation etc. and company has invested Rs.654.12 Crore in PEL.
The vision of PEL is to play a pivotal role in Indiaâs emerging Energy sector through asset base business and as a fuel aggregator.
PEL had commissioned 30 MW wind power project in Distt. of Ratlam and 20 MW wind power project in Distt. of Mandsaur of Madhya Pradesh till 31st March 2016. In FY 16-17, five wind projects of PEL totaling 238.8 MW have also been commissioned as per the agreed schedule by 31.03.2017 taking its total operating capacity to 288.8 MW. Although the PPAs have been signed for these projects, with respective Discoms, however, their ratification(s) from the State Regulator(s) is still in the process.
During the year, PEL has recorded total income of Rs.47.19 crore (Previous year Rs.4.55 Crore)
INVESTMENT IN OTHER COMPANIES (Amount released up to 31st March 2017)
- Your Company has executed Equity Subscription Agreement (ESA) for investment in Athena Energy Ventures Private Limited (AEVPL). PTC has released Rs.150 Crore. The other investors in this Company are Athena Group and IDFC. PTC has made a provision of Rs.32.55 Crore towards this investment during FY 16 - 17.
- Your Company had made an investment of Rs.37.55 Crore in Krishna Godavari Power Utilities Limited. However, due to slow progress and other issues, provision was made for entire amount of Rs.37.55 Crore during FY 2015-16.
- Teesta Urja Limited (TUL) was implementing a project of 1200 MW Teesta III Hydro Electric Project and the company invested a sum of Rs.224.33 Crore in equity of TUL. During the year 2014-15, Govt. of Sikkim (GoS) agreed to have 51% equity holding in TUL by partly acquiring shares from the existing shareholders and partly by subscribing to new shares. Accordingly the company being an existing shareholder sold a part of its shareholding amounting to Rs.44.03 crore to GoS which was carried at fair value of Rs.37.51 Crore as on 31/03/2015 as one of the existing shareholding company was non-resident therefore, valuation of shares was required to be carried out as per any internationally accepted pricing methodology under FEMA and loss due to reduction in fair value was booked in FY 2014-15 for such transfer of shares. The sale of 4,29,62,777 shares took place in August 2015 and the shareholding of PTC in TUL was reduced to 6.89%.
The remaining part of investment was also carried out at fair value of Rs.153.61 Crore as on 31/03/2015. As on 31/03/2017, the company has carried out fair valuation of investment in TUL and same stood as Rs.165.65 Crore as against Rs.153.61 Crore of previous year
- Your Company has invested Rs.4 Crore equity in M/s. Chenab Valley Power Projects Private Limited (CVPPPL) with NHPC and JKSPDC.
The Policy for Determining Material Subsidiaries as approved by the Board is available on the companyâs website at the link: http://www.ptcindia.com/ statutory information/Policy-on-Determining-Material-Subsidiaries.pdf
RELATED PARTY TRANSACTIONS
All contracts/ arrangements/ transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an armâs length basis and do not attract the provisions of Section 188 of the Companies Act, 2013. During the year, the Company had not entered into any contract/ arrangement/ transaction with related parties which could be considered material in accordance with the policy of the company on materiality of related party transactions.
The Policy on Materiality of Related Party Transactions and Dealing with Related Party Transactions as approved by the Board is available on the companyâs website at the link http://www.ptcindia.com/statutory information/Policy-on-materiality-of-Related-Party-Transactions-and-also-on-dealing-with-Related-Party-Transactions.pdf
Pursuant to clause (a) sub section (3) of section 134 of the Companies Act, 2013 & Rule 8 of Companies (Accounts) Rules 2014, Form AOC-2 is attached at Annexure 2.
DIRECTORSâ RESPONSIBILITY STATEMENT
Pursuant to the requirements of clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, the Board of Directors of your Company confirms that:
a. In the preparation of the annual accounts for the year ended March 31, 2017, the applicable accounting standards have been followed and there are no material departures from the same;
b. The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company as at March 31, 2017 and of the profit of the company for the year ended on that date;
c. The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;
d. The Directors had prepared the annual accounts of the Company on a going concern basis;
e. The Directors had laid down the internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.
f. The Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
CONSOLIDATED FINANCIAL STATEMENTS
The Company adopted Indian Accounting Standard (Ind-AS) from April 1, 2016 and accordingly, the Consolidated Financial Statements have been prepared in accordance with the Accounting Standard notified under Section 133 of the Companies Act, 2013 and the relevant rules issued thereunder read with the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 (âSEBI (LODR) Regulations, 2015â) and the other accounting principles generally accepted in India. The Consolidated Financial Statements form part of the Annual Report.
INTERNAL FINANCIAL CONTROLS
The Company has in place adequate internal financial controls with reference to financial statements. The Board has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Companyâs policies, safeguarding of its assets, the prevention of and detection of fraud and errors, the accuracy & completeness of the accounting records and the timely preparation of reliable financial disclosures.
The Company has appointed M/s. Grant Thornton for the above purpose.
DIRECTORS & KEY MANAGERIAL PERSONNEL RE - APPOINTMENT OF DIRECTORS
As per the provisions of the Companies Act, Mr. Ajit Kumar and Mr. Rajib Kumar Mishra Directors would retire by rotation at the ensuing Annual General Meeting and being eligible have offered themselves for re-appointment. The Board recommends their re-appointment.
RESIGNATIONS
- Shri Ved Jain and Shri Dipak Chatterjee, Independent Directors had completed their tenure on December 07, 2016 and April 15, 2017 respectively.
- Shri Hemant Bhargava has ceased to be the Nominee Director of LIC of India w.e.f. October 20, 2016.
- Smt. Jyoti Arora, nominee of Ministry of Power, Government of India has completed her present tenure with Central Government and ceased to be a Director w.e.f. July 6, 2017.
- On attaining the superannuation in PFC Limited, Shri Anil Kumar Agarwal, has ceased to be the Nominee Director w.e.f. January 01, 2017 (appointed on 5th February, 2015).
- On attaining the superannuation in NHPC Limited, Shri Jayant Kumar, has ceased to be a Nominee Director w.e.f. March 01, 2017 (appointed on 7th April, 2016) .
APPOINTMENTS
- Appointment of Shri Chinmoy Gangopadhyay as Nominee of PFC Limited effective from February 01, 2017.
- Appointment of Shri Mahesh Kumar Mittal as Nominee of NHPC Limited effective from March 15, 2017.
- Appointment of Shri Jayant Purushottam Gokhale as an Independent Director effective from March 16, 2017.
- Appointment of Shri Rakesh Kacker as an Independent Director effective from March 23, 2017.
- Appointment of Shri K. S. Nagnyal as Nominee of LIC of India effective from April 29, 2017.
- Appointment of Shri Arun Kumar Verma as Nominee of Ministry of Power, Govt. of India effective from August 10, 2017.
DETAILS OF BOARD MEETINGS
The Board met eight (8) times during the financial year ended on March 31, 2017. The intervening gap between any two meetings was within the period prescribed by the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as âListing Regulationsâ).
For further details in respect of Composition, number and attendance of each director in various Committees of Board as required in accordance with Secretarial Standard-1 on Board Meetings and Listing Regulations, please refer Corporate Governance Report of this Annual Report.
COMMITTEES OF THE BOARD
As on March 31, 2017 the Board had Committees i.e. the Audit Committee, the Nomination & Remuneration Committee, the Corporate Social Responsibility Committee, the Stakeholderâs Relationship Committee. The full details are available in Corporate Governance Report.
DECLARATION BY INDEPENDENT DIRECTORS
The Company has received necessary declaration from each independent director under Section 149(7) of the Companies Act, 2013, that he/she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 25 of the Listing Regulation.
FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS
The Familiarization Programme Module for Independent Directors is put up on the website of the Company at the link: http://ptcindia.com/statutory_ information/FAMILIARISATION-PROGRAMME-MODULE.pdf
BOARD EVALUATION
The performance evaluation process and related tools are reviewed by the âNomination & Remuneration Committeeâ on need basis, and the Committee may periodically seek independent external advice in relation to the process. The Committee may amend the Policy, if required, to ascertain its appropriateness as per the needs of the Company from time to time.
The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual directors which include criteria for performance evaluation of the non-executive and executive directors. The overall effectiveness of the Board is measured on the basis of the ratings obtained by each Director and accordingly the Board decides the Appointments, Re-appointments and Removal of the non-performing Directors of the Company. On the basis of Policy for Performance Evaluation of Independent Directors, a process of evaluation is being followed by the Board for its own performance and that of its Committees and individual Directors.
REMUNERATION POLICY
Your Company has in place a policy known as âNomination & Remuneration Policyâ for selection and appointment of Directors, Senior Management and their remuneration. The Policy includes criteria for determining qualification, positive attributes & independence. The Company aspires to pay performance linked remuneration to its WTDs/CMD. It is ensured that the remuneration is determined in a way that there exists a fine balance between fixed and incentive pay. The Policy of the Company on Nomination and Remuneration & Board Diversity is also placed on the website of the Company i.e. www.ptcindia.com and is also annexed to this report at Annexure 3.
VIGIL MECHANISM/WHISTLE BLOWER POLICY
Your Company believes in the conduct of the affairs of its constituents in a fair and transparent manner by adopting highest standards of professionalism, honesty, integrity and ethical behavior. In compliance with requirements of Companies Act, 2013 & Listing Regulations, the Company has established a mechanism under its Whistle Blower Policy for employees to report to the management instances of unethical behavior, actual or suspected, fraud or violation of the Companyâs code of conduct or ethics policy. Whistleblowing is the confidential disclosure by an individual of any concern encountered in the workplace relating to a perceived wrongdoing. The policy has been framed to enforce controls so as to provide a system of detection, reporting, prevention and appropriate dealing of issues relating to fraud, unethical behavior etc. The policy provides for adequate safeguards against victimization of director(s) / employee(s) who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee in exceptional cases. During the year under review, no complaints were received by the Board or Audit Committee.
The whistle blower policy of the Company is available at the link http://www.ptcindia.com/statutory_information/ptc%20Group%20whistle%20 blower%20policy.pdf
CORPORATE SOCIAL RESPONSIBILITY
As a responsible corporate citizen, PTC India Limited (PTC) is committed to ensure its contribution to the welfare of the communities in the society where it operates, through its various Corporate Social Responsibility (âCSRâ) initiatives.
The objective of PTCâs CSR Policy is to consistently pursue the concept of integrated development of the society in an economically, socially and environmentally sustainable manner and at the same time recognize the interests of all its stakeholders.
To attain its CSR objectives in a professional and integrated manner, PTC shall undertake the CSR activities as specified under the Act.
The Corporate Social Responsibility Committee has approved a Corporate Social Responsibility Policy (CSR Policy) indicating therein the activities to be undertaken by the Company presently. This has also been duly approved by the Board.
The CSR Policy is available at the link: http://www.ptcindia.com/statutory information/PTC%20Group%20Whistle%20Blower%20Policy.pdf
Further, the report on CSR Activities/ Initiatives is attached with this report at Annexure 4.
RISK MANAGEMENT POLICY
Your Company has developed and implemented a risk management framework that includes the identification of elements of risk which in the opinion of the Board may threaten the existence of the Company. A group Risk Management Policy has been approved. The main objective of this policy is to ensure sustainable business growth with stability and to promote a proactive approach in evaluating, resolving and reporting risks associated with the business. In order to achieve the key objective, the policy establishes a structured and disciplined approach to Risk Management, including the development of a Risk Matrix for each business. Tools like the Risk Matrix will guide decisions on risk related issues. Shri Rajiv Malhotra is Group Chief Risk Officer (CRO).
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENT U/S 186
Loans, guarantees and investments covered under Section 186 of the Companies Act, 2013 form part of the notes to the financial statements provided in this Annual Report.
EXTRACT OF ANNUAL RETURN
Pursuant to section 92(3) of the Companies Act, 2013 (âthe Actâ) and rule 12(1) of the Companies (Management and Administration) Rules, 2014, extract of annual return is Annexed with this report at Annexure 5.
- STATUTORY AUDITORS
M/s K.G. Somani & Co., Chartered Accountants, were appointed as Statutory Auditors of your Company in the 17th Annual General Meeting of the Company for a period of five years till conclusion of 22nd Annual General Meeting of the Company subject to the annual ratification in every Annual General Meeting. In the ensuing 18th Annual General Meeting, the appointment of Statutory Auditors is to be ratified by the members and in this regard, the Company has also received a certificate from the said Statutory Auditors to the effect that their ratification, if made, would be within the prescribed limits under Section 141 of the Companies Act, 2013 and that they are not disqualified for appointment and act as Statutory Auditors.
The Statutory Auditors have audited the Accounts of the Company for the Financial year ended 31stMarch 2017 and the same is being placed before members at the ensuing Annual General Meeting for their approval.
The Auditorsâ Report for FY 2017 does not contain any qualification, reservation or adverse remark. The Auditors Report is enclosed with the financial statements in this Annual Report.
- INTERNAL AUDITORS
M/s. GSA Associates & Co., Chartered Accountants, New Delhi were appointed as Internal Auditors of the Company for the Financial Year 2016-17 and their reports for the year were submitted to the Audit Committee & Board.
- COST AUDITORS
Cost audit is not applicable to the Company.
- SECRETARIAL AUDITORS
As required under Section 204 of the Companies Act, 2013 and Rules made there under, the Board has appointed M/s. Agarwal S. Associates, Practicing Company Secretaries as secretarial auditor of the Company for the financial year 2016-17.
The Secretarial Auditorsâ Report for fiscal 2017 does not contain any qualification, reservation or adverse remark except that the composition of Board is not in line with SEBI regulations. The Secretarial Auditors Report is enclosed to the Boardâs Report at Annexure 6. The Company has initiated the process to comply with the provision of composition of Board and same shall be complied shortly.
HUMAN CAPITAL
Your company recognises that its people are key resource. Human resources plays a pivotal role in enabling smooth implementation of key strategic decisions through leadership and capability development, and industrial relations practices. Your Company aims at providing an environment where continuous learning takes place to meet the changing demands and priorities of the business including emerging businesses. Your company believes that retaining talent gives a competitive advantage in a fast evolving and challenging business environment.
Industrial relations
Your company has always maintained healthy, cordial, and harmonious industrial relations at all levels. Despite competition, the enthusiastic efforts of the employees have enabled the Company to grow at a steady pace.
Your Company continuously invests in attraction, retention and development of talent on an ongoing basis. Your Companyâs thrust is on the promotion of talent internally through job rotation and job enlargement.
CORPORATE GOVERNANCE
A separate report on corporate governance, along with a certificate from the Practicing Company Secretary in practice regarding the compliance of conditions of corporate governance norms as stipulated under SEBI (LODR) Regulations, 2015, is annexed and forms part of the Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Management Discussion and Analysis on matters related to the business performance as stipulated in the SEBI (LODR) Regulations, 2015 is given as a separate section in the Annual Report.
BUSINESS RESPONSIBILITY REPORT
As stipulated under the SEBI (Listing Obligation & Disclosure Requirement) Regulations, 2015, the Business Responsibility Report, describing the initiatives taken by the Company from environmental, social and governance perspective forms a part of this Annual Report
Domestic Power Trading
Your Company has completed another significant year of its operations. The Financial year 2016-17 has seen a shift in focus towards addition of Renewable energy (i.e. Wind, Solar etc.) also the tariff towards the renewable energy has significantly dropped to new lows in recent bids due to large scale projects and flow of PE and foreign funds making inroads to Indian power sector. In this financial year the company has still maintained and sustained its leadership position in the industry despite several changes in the market dynamics. Volumes of the company have grown by maintaining the continuous interaction with customers, providing innovative solutions and managing the key power portfolio of some states. Your Company remains the front runner in the power trading market.
PTC has achieved the highest trading volume of 48320 MUs during 2016-17 against the previous yearâs figure of 42372 MUs with an annualized growth of 14% over the previous year. PTC achieved Short term trading volume of 7931 MUs (Previous year 10,034 Mus) during 2016-17 even after severe transmission constraints on various inter-regional links and shift of utilities to purchase from power exchanges due to prevailing low tariff in the exchanges. However, PTC managed to retain its top position with the overall trading volumes considering overall trading business.
PTCâs volume on power exchanges during 2016-17 reached 17965 MUs against the previous year figure of 13044 MUs which has seen an increase of 38 % over the previous year.
PTC has sustained its presence in the portfolio management of power business for the Utilities segment as it maintained agreement with Jharkhand Bijli Vitran Nigam Limited, Bihar State Power Holding Company Limited, Haryana Power Purchase Centre, Government of Himachal Pradesh and New Delhi Municipal Council. The arrangements mandate PTC for sale / purchase of power for the respective utilities under bilateral, power exchanges and banking arrangements.
Long Term Agreements for Purchase of power
(A) Commissioned Projects
i. Power Projects commissioned before FY 2016-17: The existing LongTerm arrangements where power supply commenced before FY2016-17: 2601 MW
ii. Power Projects commissioned during FY 2016-17: The Long-term arrangements where power supply commenced during FY 2016-17: 650 MW
iii. Power Projects expected to be commissioned in FY 2017-18: Pipeline of projects with long term arrangements which would be commencing power supply in FY 2017-18: 1430 MWs
(B) Power Purchase Agreements
PTC has in its portfolio long term Power Purchase Agreements (PPAs) with the generators for a cumulative capacity of about 11375 MW for further sale of power to Discoms which includes Cross-Border power trade.
The projects are based on domestic coal, imported coal, gas, hydro and other renewable energy resources.
(C) Agreements for Sale of Power
PTC has participated in the tender invited by SECI in FY 2016-17 for selection of power trader for sale of wind power under the Ministry of New Renewable Energy scheme for 1000 MW ISTS connected wind power projects, wherein PTC emerged as the successful bidder and LOI was placed on PTC. Subsequently, PTC has executed MoAs with seven Discoms for the entire quantum of 1049.9 MW.
PTC has participated with about 500 MW aggregate capacities in long term and medium terms bids invited by Bangladesh which are under evaluation and are likely to be finalized in the FY 2017-18. In addition, to this PTC had signed a Power Purchase Agreement for another 40 MW in May, 2016 through competitive bidding for medium term supply to Bangladesh and the power supply has commenced in October, 2016.
Cross Border Power Trade
Cross-border trade with Bhutan witnessed 5440 MUs for FY 2016-17. Also, Trade with Nepal witnessed 132.79 MUs.
In addition to the above, PTC continues to supply 250 MW power to Bangladesh Power Development Board (BPDB) from West Bengal State Electricity Distribution Company Limited. Accordingly, volume for this transaction for FY16-17 was 1902.84 MUs. In addition to this, PTC has commenced supply of 40 MW power in Oct, 2017 to BPDB on medium term basis through competitive bidding and has supplied 115.29 MUs in FY 2016-17. Accordingly, total volume for this transaction for F.Y was 2018 MUs as compared to 1908.51 MUs last year.
Cross-border transactions remain a vital part of our portfolio and we continue to see an increase in volumes in the next year also.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS/OUTGO
The particulars relating to conservation of energy, technology absorption, is not applicable.
FOREIGN EXCHANGE EARNINGS AND OUTGO
During the year, the total foreign exchange used was Rs.1.66 Crore (Exp.) and the total foreign exchange earned was Rs.1085.61 Crore.
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5(1) & Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached to the Directorsâ Report at Annexure 7 & Annexure 8 respectively.
SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL), ACT 2013
Your Company has in place a Prevention of Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013. This policy may be accessed on the Companyâs website i.e. www.ptcindia.com .
Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. All employees (permanent, Contractual, temporary, trainees) are covered under this policy. The Company has not received any sexual harassment complaints during the year 2016-17.
OTHER DISCLOSURES
i) SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
No significant or material orders were passed during the year under review by the Regulators or Courts or Tribunals which impact the going concern status and Companyâs operations in future.
ii) TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND (IEPF)
Pursuant to the provisions of the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, the Company has already filed the necessary form and uploaded the details of unpaid and unclaimed amounts lying with the Company, as on the date of last AGM, with the Ministry of Corporate Affairs. During the period under review, the Company has transferred dividend of Rs.11,37,047/- which were unclaimed for seven years or more and lied in âunpaid/ unclaimed dividend A/câ for such period to IEPF account. Further, NIL equity shares, in respect of which said unclaimed dividend has been transferred to IEPF account, have also been transferred to the IEPF account.
iii) FIXED DEPOSITS
Your Company has not accepted any deposits from public in terms of provisions of Companies Act, 2013. Thus, no disclosure is required relating to deposits under Chapter V of Companies Act, 2013.
GENERAL
Your Directors state that no disclosure or reporting in respect of the following items is required as there were no transactions on these items during the year under review:
- Issue of equity shares with differential rights as to dividend, voting or otherwise.
- Issue of shares (including sweat equity shares) to employees of the Company under any scheme.
- Neither Managing Director nor the Whole time Directors of the Company receive any remuneration or commission from any of its subsidiaries.
CAUTIONARY STATEMENT
Statements in this âDirectorâs Reportâ & âManagement Discussion and Analysisâ describing the Companyâs objectives, projections, estimates, expectations or predictions may be forward looking statements within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make difference to the Companyâs operations including raw material/ fuel availability and its prices, cyclical demand and pricing in the Companyâs principle markets, changes in the Government regulations, tax regimes, economic developments within India and the Countries in which the Company conducts business and other ancillary factors.
APPRECIATION AND ACKNOWLEDGEMENT
The directors take this opportunity to express their deep sense of gratitude to the Promoters, Shareholders, Central and State Governments and their departments, Regulators, Central Electricity Authority, banks and the local authorities for their continued guidance and support.
Your directors would also like to record its appreciation for the support and cooperation your Company has been receiving from its clients and everyone associated with the Company.
Your directors place on record their sincere appreciation to the employees at all levels for their hard work, dedication and commitment. The enthusiasm and unstinting efforts of the employees have enabled the Company to remain as industry leader.
And to you, our shareholders, we are deeply grateful for the confidence and faith that you have always reposed in us.
For and on behalf of the Board
Sd/-
(Deepak Amitabh)
Place: New Delhi. (Chairman & Managing Director)
Date: 10th August, 2017 DIN: 01061535
Mar 31, 2016
BOARDâS REPORT
Dear Shareholders,
On behalf of the Board of Directors, it is our pleasure to present the 17 th Annual Report together with the Audited Statement of Accounts of PTC India Limited (âthe Companyâ or âPTCâ) and its subsidiaries for the Financial Year ended March 31, 2016.
1. Financial Performance
The summarized standalone and consolidated results of your Company are given in the table below.
Rs, in Crores
Particulars |
Financial Year ended |
|||
Standalone |
Consolidated |
|||
31st Mar 2016 |
31st Mar 2015 |
31st Mar 2016 |
31st Mar 2015 |
|
Total Income |
12,882.23 |
13,149.36 |
14,038.26 |
13,939.19 |
Profit/(loss) before Interest, Depreciation & Tax (EBITDA) |
349.56 |
306.43 |
1224.04 |
866.43 |
Finance Charges |
1.90 |
0.96 |
532.78 |
418.13 |
Depreciation |
3.49 |
4.16 |
10.09 |
8.45 |
Provision for Income Tax (including for earlier years) |
110.56 |
98.21 |
250.92 |
183.59 |
Net Profit/(Loss) After Tax |
233.61 |
203.10 |
430.25 |
256.26 |
Profit/(Loss) brought forward from previous year |
385.20 |
315.82 |
480.93 |
448.98 |
Amount transferred to General Reserve |
70.08 |
60.93 |
70.08 |
60.93 |
Amount transferred to Proposed Dividend (including dividend distribution tax) |
82.19 |
72.65 |
90.55 |
79.39 |
Transferred to special reserve |
58.30 |
51.67 |
||
Transferred to statutory reserve |
78.22 |
32.18 |
||
Adjusted in terms of transitional provision of schedule II to the Companies Act 2013 |
0.14 |
0.14 |
||
Profit/(Loss) carried to Balance Sheet |
466.54 |
385.20 |
614.03 |
480.93 |
*previous year figures have been regrouped/rearranged wherever necessary.
2. Results of Operations and State of Companyâs Affairs
The trading volumes were higher by 14.10% this year at 42,372 MUs as against 37,137 MUs during the previous year. With a turnover of Rs,12,882.23 crore (including other income) for the year 2015-16 as against Rs,13,149.36 crore (including other income) in the Financial Year 2014-15, your Company has earned a Profit After Tax of Rs, 233.61 crore as against Rs,203.10 crore in the previous year.
Your Company has two subsidiaries, namely PTC India Financial Services Limited (PFS) and PTC Energy Limited (PEL). The consolidated turnover of the group is Rs,14,038.26 crore for the Financial Year 2015-16 as against Rs,13,939.19 crore for the Financial Year 2014-15. The consolidated Profit After Tax of the Group is Rs,430.25 crore for the Financial Year as against Rs,256.26 crore for the Financial Year 2014-15.
3. Reserves
Out of the profits of the Company, a sum of Rs,70.08 crore has been transferred to General Reserves during the Financial Year and total reserves and surplus of the Company are Rs,2,493.87 crore (including securities premium) as on 31st March 2016.
4. Dividend
The Board of Directors of your Company are pleased to recommend for your consideration and approval, a dividend @ 25% (which is higher by 14% from the last year) for the Financial Year 2015-16 i.e. Rs,2.50 per equity share of Rs,10 each. The dividend, if approved, at ensuing Annual General Meeting will absorb Rs,89.06 crore including Dividend Distribution Tax amounting to Rs,15.06 crore (without netting off credit of Rs,6.87 crore on dividend received from subsidiary company).
The dividend will be paid to the members whose names appear in the Register of Members as on a record date and in respect of shares held in dematerialized form whose names are furnished by National Securities Depositories Limited (NSDL) and Central Depository (India) Limited (CDSL) as beneficial owners as on record date.
5. Net Worth and Earnings Per Share (EPS)
As on 31st March 2016, net worth of your Company aggregates to Rs,2789.88 crore as compared to Rs,2638.56 crore for the previous Financial Year thereby registering a growth of 5.73%.
EPS of the Company for the year ended 31st March, 2016 stands at Rs,7.89 in comparison to Rs,6.86 for the Financial Year ended 31st March, 2015.
6. Material changes and commitments, if any, affecting the financial position of the Company
There has been no material changes and commitments affecting the financial position of the Company which have occurred between the end of the Financial Year of the Company to which the financial statement relates (i.e. 31st March , 2016) and the date of the report.
7. Changes in Capital Structure,
During the period under review, no change has taken place with regard to capital structure of the Company.
As on 31st March 2016, PTC has Authorized Share Capital of Rs,750, 00,00,000 and paid-up share capital of Rs,296,00,83,210/- divided into 29,60,08,321 equity shares of Rs,10 each. The equity shares of your Company are listed on the Rs,BSE Limited (BSE) and âNational Stock Exchange of India Ltd.â (NSE). The promoters i.e. NTPC Ltd. (NTPC), Power Grid Corporation of India Ltd. (POWERGRID), Power Finance Corporation Ltd. (PFC) and NHPC Ltd. (NHPC) individually hold 4.05% each or 16.20% collectively of the paid-up and subscribed equity share capital of your Company and the balance of 83.80% of the paid-up and subscribed equity share capital of your Company is held by Power Sector Entities, Financial Institutions, Life Insurance Corporation of India, other Insurance Companies, Banking Institutions, Corporations, Investment Companies, Foreign Institutional Investors, Private Utilities and others including public at large.
8. Subsidiaries, Associates and Joint Ventures
Pursuant to sub-section (3) of section 129 of the Companies Act, 2013 (âthe Actâ), the statement containing the salient features of the financial statement of a companyâs subsidiary or subsidiaries, associate company or companies and joint venture or ventures is given in Form AOC-1 as Annexure 1.
8.1 Subsidiary Companies
(a) PTC India Financial Services Limited
PTC India Financial Services Limited (PFS) is a subsidiary of PTC India Limited wherein PTC holds 60% stake and has invested Rs,446 crore. PFS is listed on NSE and BSE and has been classified as Infrastructure Finance Company (IFC) by the Reserve Bank of India.
PFS recorded revenue of Rs,1186.91 crore during FY16 compared to revenue of Rs,801.89 crore during FY15. Interest income for FY16 stood at Rs,921.41 crore compared to Rs,741.61 crore during FY15, thus registering an increase of about 24%. The profit before tax and profit after tax for FY16 stood at Rs,531.44 crore and Rs,391.10 crore respectively. Net interest income increased to Rs,421.58 crore, thereby recording a growth of over 23% during FY16.
The Board of Directors of PFS has recommended a dividend @ 12% i.e. Rs,1.20 per equity share of Rs,10/- each for the Financial Year 2015-16.
(b) PTC Energy Limited
PTC Energy Limited (PEL) was set up as a subsidiary of PTC India Limited to develop asset base taking in to its sphere the developmental activities, fuel intermediation etc. and company has invested Rs,140.69 crore in PEL. The vision of PEL is to play a pivotal role in Indiaâs emerging Energy sector through asset base business and as a fuel aggregator.
PEL has commissioned 30 MW wind power project in Dist. of Ratlam and 20 MW wind power project in Dist. of Mandsaur of Madhya Pradesh before 31st March 2016. PEL is pursuing more opportunities for investment in renewable energy sector as it has emerged as most promising business sector in energy space.
8.2 Investment in other Companies (Amount released up to 31st March 2016)
(a) Your Company has earlier executed Equity Subscription Agreement (ESA) for investment in Athena Energy Ventures Private Limited (AEVPL). PTC has released Rs,150 crore. The other investors in this Company are Athena Group and IDFC.
(b) Your Company has earlier executed Equity Subscription Agreement (ESA) for investment in Krishna Godavari Power Utilities Limited up to Rs,40 crore. PTC has released Rs,37.55 crore. However, due to slow progress and other issues , provision has been made for entire amount of Rs,37.55 Crores.
(c) Teesta Urja Limited (TUL) is developing 1200 MW Teesta-III Hydro Electric Project in the State of Sikkim. Your Company had invested Rs,224.02 crore. The Company had divested part of its long term investment in TUL so as Govt. of Sikkim could acquire 51% against its present holding of 26%. This disinvestment had been of 4,39,62,777 shares which reduced the shareholding of PTC to around 6.89%
(d) Your Company has 2% equity in M/s. Chenab Valley Power Projects Private Limited (CVPPPL) with NHPC and JKSPDC and as of now PTC has released approx. Rs,4 Crores.
[The Policy for Determining Material Subsidiaries as approved by the Board is available on the companyâs website at the link: http://ptcindia.com/ statutory_information/Policy-on-Determining-Material-Subsidiaries.pdf.j
9. Related party transactions
During the year, the Company had not entered in to any contract/ arrangement/ transaction with related parties which could be considered material in accordance with the policy of the company on materiality of related party transactions.
[The Policy on Materiality of Related Party Transactions and Dealing with Related Party Transactions as approved by the Board is available on the companyâs website at the link http://ptcindia.com/statutory_information/ Policy-on-materiality-of-Related-Party-Transactions-and-also-on-dealing-with-Related-Party-Transactions.pdf]
10. Directorsâ Responsibility Statement
Pursuant to the requirement of clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, the Board of Directors of your Company confirms that:
(a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;
(b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period;
(c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;
(d) the directors had prepared the annual accounts on a going concern basis; and
(e) the directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and are operating effectively.
(f) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.
11. Listing Agreement
The Securities and Exchange Board of India (SEBI), on September 2, 2015, issued SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 with the aim to consolidate and streamline the provisions of the listing Agreement for different segments of capital markets to ensure better enforceability. The said regulations were effective December 1, 2015. Accordingly, all listed entities were required to enter into Listing Agreement within six months from the effective date. The Company has executed the same with BSE and NSE within stipulated time.
12. Internal Financial Controls
The Company has in place adequate internal financial controls with reference to financial statements. The Board has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Companyâs policies, safeguarding of its assets, the prevention of and detection of fraud and errors, the accuracy & completeness of the accounting records and the timely preparation of reliable financial disclosures.
Company has appointed M/s. Grant Thornton for the above purpose.
13. Directors & Key Managerial Personnel
In accordance with provisions of the Act and Articles of Association of the Company, Shri Ravi P. Singh and Smt. Jyoti Arora, Directors would retire by rotation at the ensuing Annual General Meeting and being eligible has offered themselves for re-appointment.
The tenure of Shri S. Balachandran, Independent Director was completed on 31st March 2016. On attaining the superannuation in NHPC, Shri D.P. Bhargava has ceased to be nominee of NHPC w.e.f. 31st March 2016. During the year, Shri I.J. Kapoor also ceased to be nominee of NTPC in PTC India Ltd.
Shri K. Biswal has been appointed as nominee of NTPC and Shri Jayant Kumar has been appointed as nominee of NHPC on the Board of PTC India Ltd.
The Company also appointed two Whole-time Directors i.e. Shri A jit Kumar w.e.f. 2nd April, 2015 and Shri Arun Kumar w.e.f. 16th June, 2015. The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under the Companies Act, 2013 and regulation 25 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations) and erstwhile clause 49 of the Listing Agreement entered into with the Stock Exchanges.
The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual directors which include criteria for performance evaluation of the non-executive and executive directors. The overall effectiveness of the Board is measured on the basis of the ratings obtained by each Director and accordingly the Board decides the Appointments, Re-appointments and Removal of the non-performing Directors of the Company. The Company aspires to pay performance linked remuneration to its WTDs/CMD. It is ensured that the remuneration is determined in a way that there exists a fine balance between fixed and incentive pay. On the basis of Policy for Performance Evaluation of Independent Directors, a process of evaluation is being followed by the Board for its own performance and that of its Committees and individual Directors.
The performance evaluation process and related tools are reviewed by the âNomination & Remuneration Committeeâ on need basis, and the Committee may periodically seek independent external advice in relation to the process. The Committee may amend the Policy, if required, to ascertain its appropriateness as per the needs of the Company from time to time. The Policy may be amended by passing a resolution at a meeting of the Nomination & Remuneration Committee.
[The Familiarization Programme Module for Independent Directors is put up on the website of the Company at the link: http://ptcindia.com/ statutory information/FAMILIARISATION-PROGRAMME- MODULE. pdf]
The Policy of the Company on Nomination and Remuneration & Board Diversity is attached herewith at Annexure 2.
14. Details of Board meetings
During the year, five Board meetings were held, details of which are given below:
Date of the meeting |
No. of Directors attended the meeting |
|
28th May 2015 |
12 |
|
05th August 2015 |
14 |
|
12th September 2015 |
15 |
|
3rd November 2015 |
13 |
|
5th February 2016 |
12 |
Further, the attendance of each director in the respective board meetings is mentioned under the heading of âReport on Corporate Governanceâ.
15. Vigil mechanism
The Company believes in the conduct of the affairs of its constituents in a fair and transparent manner by adopting highest standards of professionalism, honesty, integrity and ethical behavior. In compliance with requirements of Companies Act, 2013 & Listing Agreement, the Company has established a mechanism under its Whistle Blower Policy for employees to report to the management the instances of unethical behavior, actual or suspected, fraud or violation of the Companyâs code of conduct or ethics policy. Whistle blowing is the confidential disclosure by an individual of any concern encountered in the workplace relating to a perceived wrongdoing. The policy has been framed to enforce controls so as to provide a system of detection, reporting, prevention and appropriate dealing of issues relating to fraud, unethical behavior etc. The policy provides for adequate safeguards against victimization of director(s) / employee(s) who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee in exceptional cases. During the year under review, no employee was denied access to Audit Committee.
[The whistle blower policy of the Company is available at the link http:// www.ptcindia.com/common/Whistle-Blower-Policy.pdf]
16. Corporate Social Responsibility
The CSR Committee has formulated and recommended to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, which has been approved by the Board. The CSR policy is uploaded on Companyâs website. Further, the report on CSR Activities/ Initiatives is enclosed as Annexure 3.
17. Risk Management Policy
The Company has developed and implemented a risk management framework that includes the identification of elements of risk which in the opinion of the Board may threaten the existence of the Company. A group Risk Management Policy has been approved. The main objective of this policy is to ensure sustainable business growth with stability and to promote a proactive approach in evaluating, resolving and reporting risks associated with the business. In order to achieve the key objective, the policy establishes a structured and disciplined approach to Risk Management, including the development of a Risk Matrix for each business. Tools like the Risk Matrix will guide decisions on risk related issues.
18. Employeesâ Stock Option Scheme
Shareholdersâ approval of the scheme was obtained at the Annual General Meeting held on 6thAugust 2008 for introduction of Employee Stock Option Plan at PTC India Ltd. Two grants have been made under the ESOP 2008. Disclosures stipulated under the SEBI Guidelines have been made.
Period of Vesting for PTC India Limited.
As per PTC India Limited Employee Stock Option Plan 2008, there shall be a minimum period of 1 (one) year between the grant of options and vesting of options. Subject to participantâs continued employment with the Company or the subsidiary and restrictions, if any, set out in case of terminal events, the Unvested Options shall vest with the Participants over a four year period as per the following schedule.
Vesting |
No of years from the grant date |
% of options vested |
Cumulative % of options vested |
1ât |
1 |
15% |
15% |
2nd |
2 |
15% |
30% |
3rd |
3 |
30% |
60% |
4th |
4 |
40% |
100% |
Exercise Period for PTC India Limited
Subject to the conditions laid down for terminal events (death, permanent incapacitation of the employee etc.), the vested options shall be exercisable within a period of 5 (five) years from the first vesting date.
The applicable disclosures as stipulated under SEBI guidelines as on March 31, 2016 with regard to Employeesâ Stock Options (ESOPs) are provided in Annexure 4 to this Report.
The Certificate from the Auditors of the Company that the Scheme has been implemented in accordance with SEBI Guidelines and the resolution passed by the members would be placed at the Annual General Meeting for inspection by members.
19. Particulars of loans, guarantees or Investment u/s 186
Loans, guarantees and investments covered under Section 186 of the Companies Act, 2013 form part of the notes to the financial statements provided in this Annual Report (Please refer to Note 11 to the standalone financial statement).
20. Extract of Annual Return
Pursuant to section 92(3) of the Companies Act, 2013 (âthe Actâ) and rule 12(1) of the Companies (Management and Administration) Rules, 2014, extract of annual return is placed as Annexure 5.
21. Statutory Auditors, their Report and Notes to Financial Statements
M/s K.G. Somani & Co., Chartered Accountants, were appointed as Statutory Auditors of your Company in the 15th Annual General Meeting of the Company to hold office till the conclusion of 17th Annual General Meeting. In terms of Section 139 of Companies Act, 2013, the Statutory Auditors are to be appointed. The Company has received letter from them to the effect that their re-appointment, if made, would be within the prescribed limits under Section 141 of the Companies Act, 2013 and that they are not disqualified for re-appointment and are eligible for reappointment.
The Statutory Auditors have audited the Accounts of the Company for the Financial year ended 31st March 2016 and Audited Accounts together with the Auditorsâ Report thereon are annexed to this report. The observations of the Auditors in their Report on Accounts read with the relevant notes to accounts are self- explanatory and do not call for any further comments. The Auditorsâ Report does not contain any qualification, reservation or adverse remark.
22. Internal Auditors
M/s. GSA & Associates, Chartered Accountants, New Delhi were appointed as Internal Auditors of the Company for the Financial Year 201516 and their reports for the year were submitted to the Audit Committee & Board.
23. Cost Auditors
Cost audit is not applicable to the Company.
24. Secretarial Auditors
In terms of Section 204 of the Companies Act, 2013 and Rules made there under, M/s. Agarwal S. & Associates, Practicing Company Secretaries was appointed to conduct secretarial audit of the Company for the financial year 2015-16. The report of the Secretarial Auditors is enclosed as Annexure 6 to this report and the report does not have any reservation or qualification.
25. Human Resources
People are the core assets of the Company. Your Company places engagement, development and retention of talent at its highest priority, to enable achievement of organizational vision.
Your Company has continued to achieve an organizational balance by recruiting limited positions at the top and senior management levels and strengthening the middle and junior management team of professionals. During the year, your Company has given thrust to an organizational development programme and has been developing systems and processes that maximize human potential. Your Company has developed a KRA/KPI based Performance Management System to link and measure individual performance with the organizational performance score card during the year. Your Company continuously invests in attraction, retention and development of talent on an ongoing basis. Your Companyâs thrust is on the promotion of talent internally through job rotation and job enlargement. Strong governance processes and stringent risk management policies are adhered to, in order to safeguard our stakeholdersâ interest.
Industrial relations
Your company has always maintained healthy, cordial, and harmonious industrial relations at all levels. Despite of competition, the enthusiastic efforts of the employees have enabled the Company to grow at a steady pace.
26. Internal complaints
An Internal Complaints Committee has been constituted to look into grievance/complaints of sexual harassment lodged by women employees as per Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Further, no complaints were received during the year and no complaint is pending as on 31st March, 2016.
27. Management Discussion and Analysis
The baseline projection for global economic growth in 2016 is a modest 3.2%, broadly in line with last year. The recovery is projected to strengthen in 2017 and beyond, driven primarily by emerging markets and developing economies, as conditions in stressed economies start gradually to normalize. But uncertainty has increased, and risks of weaker growth scenarios are becoming more tangible. The fragile conjuncture increases the urgency of a broad-based policy response to raise growth and manage vulnerabilities. India - Asiaâs third-largest economy retained its world-beating 7.6% GDP growth for FY16 (with 2004-05 as base year), even as emerging markets like China, Russia and Brazil are slowing down. Data released by the Central Statistics Office showed that the Indian economy crossed the USD 2.02 trillion mark, compared to USD 1.9 trillion in the previous year supported by improved agriculture output, better manufacturing, mining , electricity production and lower interest rates leading to higher consumption. On the flip side, we have serious concern of NPAs. The banks are saddled with stressed assets, capacity utilization is low and corporate investments are dismal. Manufacturing, accounting for nearly 40% of total employment, witnessed a de-growth, so did mining, construction and non-financial services.
Indian power sector is in its growth path with developments in Renewable Energy (RE) segment taking the lead. The power sector witnessed 11.4% growth in installed capacity with an addition of 30,422 MW. Within power sector, there has been substantial capacity addition in the renewable energy and total RE installed capacity stood at 38,822 MW at the end of FY-16. Transmission linesâ addition achieved was 28,114 CKms as against target of 23,712 CKms. The power supply situation has improved and we had 2.1% of energy deficit and 3.2% of peak deficit as compared to 3.6% & 4.7% during 2014-15.
In this year, the low demand from Distribution Utilities caused the major concern leading to PLFs going down to 62-63%. The Discoms are facing heavy debt burden (Total Discom Debt aggregates to ''4.3 Lac Crores) and has accumulated losses of more than ''4 lakh Crores. Government has come up with Ujwal DISCOM Assurance Yojana (UDAY) - a significant policy measure to improve financial condition of Discoms as well as measures for cost reflective tariffs and reduction in AT&C losses. So far 13 States have signed MoUs under this scheme and States have raised around ''1 Lac Crores through UDAY bonds till 31 March 2016. Similarly, New Tariff Policy also emphasizes the need for efficiency improvements and has provision for usage of Smart meters in a phased manner to enable âTime of Dayâ metering, reduce theft and allow net-metering as well as timely revision of tariff.
Although, more than 80% of the power is tied up under long term arrangements with State Generation, Central Generation and IPPs, it is increasingly getting under dispute due to uncertainty over supply, tariff, demand projections and associate financial implications. Your company has been adapting to the changed requirements and has been promoting Medium Term procurement of power with a time horizon of 3-5 years along with short term procurement for temporary and very near term demand can be a solution which may provide a win - win solution both to the Discoms as well as generators. We need enabling policies to promote medium term power procurement such as inter -se parity in usage of common infrastructure (transmission, fuel transport arrangement), availability of fuel, and financing to support medium term PPAs.
The initiatives taken by government to improve the sector like UDAY, New Tariff Policy, and Coal rationalization and allocation policy are aimed towards improving the off-take and availability of power at affordable prices. These measures shall take more time to unwind the sector, accordingly the result is expected to come in due course of time.
The outlook of the sector is efficiency improvement in the value chain especially through the IT enablement, promotion of environment friendly renewable technologies and energy efficiency solutions in the coming future. These areas can provide business opportunities to various stakeholders. This year, despite volatility, the power market showed a substantial growth and the volumes in the short term power market increased to 16.4% (from 115,230 MUs in FY16 as compared to 98,987 MUs in FY15).
Your company maintained its leadership position with a market share of 35% (including Cross Border). During FY-16, your companyâs trading volumes increased by 14% to 42,372 MUs as compared to 37,137 MUs during FY15. Due to inter regional grid constraints, some of the contracts could not be operational zed/partially operational zed and the power flow was restricted to that extent resulting in a volume loss of about
5,360 MUs.
Your company improved on the average margin (net of rebate, surcharge and tolling converted PPAs) realization to 5 Paisa / unit as compared to 4.6 paisa / unit in FY15 exhibiting an increase of 8.6% YoY. Your company continues to consolidate in its core trading business with a balanced portfolio of Long /Medium /Short Term contracts within India as well as Cross Border trades and Exchange based transactions with resultant improvement in average margin realizations.
Your company participated in the recently launched, Ministry of Power, DEEP e-bidding portal offering the maximum number of bids at competitive rates for utilities of Uttarakhand and Kerala. PTC offered a total of 9 bids from different sources to Uttarakhand & 3 bids to Kerala on the first ever e-bidding & e-RA (Reverse Auction) conducted on the new DEEP portal and emerged successful in both.
In 2015-16, Your Company has added long term power supply to an extent of 461 MW to UP and Tamil Nadu. With this addition, total capacity under long term power supply has reached to 2,571 MW. Going forward, long term contracts of 890 MW is expected to get operationalize soon. I am happy to share the concerned regulatory commissions have approved the transactions.
On policy front, persistent efforts has brought the desired result in the form of inclusion of traders for participating in the medium term bidding process. Your company is participating in the various Medium Term tenders being issued by various State utilities.
Cross-border trades have always been of utmost importance to your company. This year, continuing the legacy, cross border transactions contributed 7,151 MUs (16.88%) in the total traded volumes in FY-16. The Cross-border trade with Bhutan in FY-16 was 5,107 MUs, with Nepal it was 136 MUs and with Bangladesh, the traded volume was 1908 MUs. Your company participated in the tariff based competitive bidding and received LOI for supply of 40 MW power to Bangladesh Power Development Board for 2 years. Your company has also signed a short term agreement with Nepal for supply of up to 30 MW RTC Power for the period starting from 1st November, 2015 to 30th June, 2016.
Your company has been focusing into developing new businesses to cater to the dynamic needs of the industry and customer. PTC Retail business, which was set up for facilitating power supply to the industrial and commercial consumers, is growing at a fast pace and has grown 34% over previous year. The retail business traded 7,221 MUs in the FY 201516 constituting around 17% of total traded volume. Your company has added reputed organizations such as Delhi Metro Rail Corporation, Indian Railways, SAIL, Reliance Industries, ACC Cements, MRF Tyres etc. in its client list.
Your company has increased its presence in the portfolio management business for the Utilities segment, as it executed agreements with Jharkhand Bijli Vitran Nigam Limited, and Indian Railways for managing their power portfolio. New Delhi Municipal Corporation has extended the agreement for management of NDMCâs power portfolio by another three years. Further, PTC and Railways Energy Management Company have together set up a control room in PTC Office for managing the power portfolio of Indian Railways. State utilities and generators such as Department of Power, Arunachal Pradesh, Government of Himachal Pradesh, NEEPCO, NHPC, Haryana Power Generation Company Ltd and Bihar State Electricity Board were added/renewed agreement for sale/purchase of power. Your company was also awarded a contract by DVC to sell its surplus power for FY-16. Your company has diversified in energy efficiency space, and is engaged as a project management consultant for DELP schemes in four States viz Maharashtra, UP, Himachal Pradesh and Rajasthan. Similar services are being provided in street lightning projects in two circles in Andhra Pradesh. Your company has mapped its potential and identified key areas for delivering knowledge-based value by rendering advisory services with an objective to expand its learning curve and create alternate revenue potential for its business. Your Company assisted petroleum refineries in conducting feasibility analysis for EHV transmission connectivity for optimized power procurement through Open Access. Successful execution of such assignments provided us strong credentials to undertake route survey, engineering and contracting activities for bulk consumers The company has also formed strategic consortium with REC Transmission Projects Company Limited for jointly undertaking engineering and contracting activities for large size transmission projects. Your company assisted petroleum refineries and related constituents in contract structuring and transaction advisory in procurement of power through open access under group captive or bilateral mode. The company will be responsible for trading of power, contractual advisory and back-end support to trading operations. Your company has also executed consultancy assignments on evaluating economic benefits for Special Economic Zones as deemed distribution licensees.
Your company also believes in sharing knowledge with the neighboring countries to create knowledge base as well as strengthen relationships. With this objective, your company organized capacity building programme in the area of Power Trading for officials from Nepal, Bhutan, Bangladesh and Afghanistan and conducted 7 days on the job training at control room besides the sessions at NPTI.
Your company was selected by Foreign & Commonwealth Office, UK through British High Commission, New Delhi under their Prosperity Fund Programme for preparing the Indian power market for carriage and content separation through collaboration with the UK. PTC worked in close association with key stakeholders in implementing business of supply licensee (introduced in draft Amendment to Electricity Act 2003) in India and undertook pilot study for TPDDL (Delhi) and PSPCL (Punjab). PTC successfully concluded national level final workshop on carriage and content separation in coordination with British High Commission.
Your company is focused towards the quality services to its customers. For taking customersâ feedbacks, company rolled out a customer satisfaction survey for all the customers and followed up with customer interaction meet.
With the industry shift towards environment friendly technologies, your company has also made substantial progress in this arena. Your company entered into a MoU with Solar Energy Corporation of India (SECI) on 9th Octberâ15 for sale and purchase of power generated from 3000 MW solar projects for onward sale on long term basis, for full term of 25 years. PTC is also supporting SECI in managing the operational and commercial aspects of solar energy being traded through SECI under JNNSM Phase-I. The total volume facilitated for SECI was 973 MUs in FY16. Further, CRISIL has awarded highest MNRE GRADE SP 1A to your company indicating the company has âHighest Performance Capability and Highest Financial Strengthâ to undertake projects in Solar PV technology.
Your companyâs subsidiaries are on a high growth path. PTC India Financial Services Limited (PFS) recorded revenue of Rs,1186.9 Crores during FY-16 compared to revenue of Rs,801.9 Crores during FY-15. Interest income for FY-16 stood at Rs,921.4 Crores compared to Rs,741.6 Crores during FY-15, thus registering an increase of about 24%. The Profit Before Tax (PBT) and Profit After Tax (PAT) for FY-16 stood at Rs,531.4 Crores and Rs,391.1 Crores respectively. Net interest income increased to Rs,421.6 Crores, thereby recording a growth of over 23% during FY-16. Earnings Per Share (EPS) for financial year stood at Rs,6.96 per share vis a vis last year EPS of Rs,2.86.
PTC Energy Limited (PEL) commissioned two wind power projects with cumulative capacity of 50 MW in Madhya Pradesh. The first of the projects of 30 MW in Jaora, Ratlam District got commissioned on 8th March 2016. Further, 2nd project of 20 MW Wind Power Project at Nipaniya, Mandsaur District got commissioned by March, 2016.
Going forward your company is consolidating its core trading business with a focus on high growth/high trading margin segments. Development, Financing and trading of renewable energy projects on our own or through subsidiaries will remain our thrust area in coming future. Further your company will keep on adding value added business in the form of advisory and other related services for the growth of the company as well to keep up with the expectations of the industry and customers.
28. Domestic Trading
Your Company has completed another significant year of its operations. Financial year 2015-16 has been a turbulent year for the power sector due to poor financial health of the State utilities and widespread transmission
constraints on various Inter Regional Links. The company has maintained and sustained its leadership position in the industry despite several turbulences. Volumes of the company have grown by maintaining the continuous interaction with customers, providing innovative solutions and managing the key power portfolio of some states. Your Company remains the front runner in the power trading market.
PTC achieved the highest trading volume of 42,372 MUs during 2015-16 against the previous yearâs figure of 37,137 MUs which is growth of 14% over the previous year. PTC achieved Short term trading volume of 10,334 MUs during 2015-16 despite of severe transmission constraints on various inter-regional links. The Company also carried out a significant number of energy banking transactions during the year which has contributed to the overall trading volume. PTCâs volume on power exchanges FY 2015-16 reached 13,044 MUs against 9,668 MUs in the previous year exhibiting an increase of 34% over the previous year.
Long Term Agreements for Purchase of power
(A) Commissioned Projects
i. Power Projects commissioned before FY 2015-16: The existing Long-Term arrangements where power supply commenced before FY2015-16: 2110 MW
ii. Power Projects commissioned during FY 2015-16: The Long-term arrangements where power supply commenced during FY 2015-16: 461 MW
iii. Power Projects expected to be commissioned in FY 2016-17: Pipeline of projects with long term arrangements which would be commissioned/commence power supply in FY 2016-17: 1880 MWs
(B) Power Purchase Agreements
PTC has in its portfolio long term Power Purchase Agreements (PPAs) with the generators for a cumulative capacity of about 11,586 MW for further sale of power to Discoms which includes Cross-Border power trade. The projects are based on domestic coal, imported coal, gas, hydro and other renewable energy resources.
(C) Agreements for Sale of Power
As per the Tariff Policy of Government of India, the long term power procurement by the SEBs/ DISCOMs has to be necessarily done through competitive bidding. As such, sale of power to the State Utilities has to be through participation in the bidding process. Till now, PTC has participated in competitive bids invited by State Utilities/Private Discoms/Deemed Licensees like Rajasthan, UP, AP, MP, Kerala, Tamil Nadu, Railways, Bangladesh etc. (Long term and Medium term) and has bid for about 5,684 MW aggregate capacities. During the FY 2015-16, PTC has participated with about 500 MW aggregate capacities in long term and medium terms bids invited by Bangladesh which are under evaluation and had signed a Power Purchase Agreement for another 40 MW in May, 2016 through competitive bidding for medium term supply to Bangladesh.
Acknowledgement
Your Directors place on record their appreciation for employees at all levels, who have contributed to the growth and performance of your Company.
Your Directors also thank the Promoters, Govt. of India, Regulatory Authorities, Central Electricity Authority, clients, vendors, bankers, shareholders and advisors of the Company for their continued support.
Your Directors also thank the Central and State Governments, and other statutory authorities for their continued support.
For and on behalf of the Board of PTC India Ltd.
Sd/-
Deepak Amitabh
(Chairman & Managing Director)
DIN: 01061535
Date : 11th August, 2016
Place : New Delhi
Mar 31, 2014
Dear Shareholders,
The Directors have pleasure in presenting you the fi fteenth Annual
Report and Company''s audited accounts for the financial year ended
31st March 2014.
Performance and Financial Highlights
Your Company has completed another successful year of its operations,
wherein it has continued to maintain its leadership position in the
industry. The trading volumes were higher by 22.85% this year at 35,130
MUs as against 28,597 MUs during the previous year. With a turnover of
Rs. 11,565.05 crore (including other income) for the year 2013Â14 as
against Rs. 8,868.73 crore (including other income) in the Financial Year
2012Â13, your Company has earned a Profit After Tax of Rs. 251.23 crore
as against Rs.128.74 crore in the previous year.
Your Company has two subsidiaries, namely PTC India Financial Services
Limited (PFS) and PTC Energy Limited (PEL). The consolidated turnover
of the group is Rs. 12,143.31 crore for the Financial Year 2013Â14 as
against Rs. 9,213.11 crore for the Financial Year 2012Â13. The
Consolidated Profit After Tax of the Group is Rs. 360.84 crore for the
current Financial Year as against Rs. 198.28 crore for the Financial Year
2012Â13.
The Financial Results of the Company for the FY 2013Â14 visÂaÂvis FY
2012Â13 under broad heads are summarized as under:Â
Financial results of the company for the FY 2013Â14 vis ÂaÂvis FY
2012Â13
Particulars For the Year For the Year
ended 31.03.2014 ended 31.03.2013
(in Rs Crores) (in RS Crores)
Sales (including rebate on
purchase of 11,510.71 8,856.87
power, service charges and
surcharge)
Other Income (including income from 54.34 11.86
consultancy
services)
Purchase (including rebate on sale of 11,060.49 8,215.74
power)
Change inInventories 18.31 -
Employee Cost 15.46 12.974
Other Expensesetc. 35.49 20.71
Fuelcost - 272.31
Finance Cost 2.75 0.92
Operating expenses 68.02 165.13
Profit before amortization,
depreciation, 364.53 180.95
prior period items and exceptional
items
Amortization andDepreciation 4.20 4.21
Exceptional items
Expense/(Income) (4.32) (0.03)
Prior PeriodExpenses/(Income) 0.43 (1.69)
Profit BeforeTax 364.22 178.46
Provision for Taxation (including 112.99 49.72
deferred tax income
Profit AfterTax 251.23 128.74
Balance as per lastaccounts 206.93 172.22
Transferred to GeneralReserves 75.37 38.62
Dividend (incl. dividendtax) 66.97 55.41
Transfer to contingent
reserves
Balance carried forward to Balance 315.82 206.93
Sheet
Earnings Per Share in 8.49 4.36
Appropriations
Dividend
Your Directors are pleased to recommend for your consideration and
approval dividend @ 20% (which is higher by 4% from the last year) for
the Financial Year 2013Â14 i.e. Rs 2.00 per equity share of Rs. 10 each.
The dividend, if approved, at ensuing Annual General Meeting will
absorb Rs. 69.26 crore including Dividend Distribution Tax amounting to Rs.
10.06 crore (without netting off credit of Rs. 2.29 crore on dividend
received from subsidiary company).
The dividend will be paid to the members whose name appears in the
register of members as on a record date and in respect of shares held
in dematerialized form whose name is furnished by the Depositories, as
benefi cial owners as on record date.
Reserves
Out of the profits of the Company, a sum of Rs. 75.37 crore has been
transferred to General Reserves during the year and total reserves and
surplus of the Company are Rs. 2,212.40 crore (including securities
premium) as on 31st March 2014.
Public Deposits
The Company has not accepted any public deposits during the year and as
such, no amount on account of principal or interest was outstanding as
on the date of Balance Sheet.
Capital Structure
As on 31st March 2014, PTC has Authorized Share Capital of Rs.
750,00,00,000 and PaidÂUp Capital of Rs. 296,00,83,210/Â divided into
296008321 equity shares of Rs.10 each. The equity shares of your Company
are listed on the ''Bombay Stock Exchange Limited'' (BSE) and ''The
National Stock Exchange of India Ltd.'' (NSE). The promoters i.e. NTPC
Ltd. (NTPC), Power Grid Corporation of India Ltd. (POWERGRID), Power
Finance Corporation Ltd. (PFC) and NHPC Ltd. (NHPC) individually hold
4.055% each or 16.22% collectively of the paidÂup and subscribed equity
share capital of your Company and the balance of 83.78% of the paidÂup
and subscribed equity share capital of your Company is held by power
sector entities, Financial Institutions, Life Insurance Corporation of
India and other Insurance Companies, Banking Institutions,
Corporations, Investment Companies, Foreign Institutional Investors,
Private Utilities and others including public at large.
The shareholding pattern of your Company as on 31.03.2014 is as
follows:Â
Category No. of shares Percentage of
held Shareholding
A Promoters holding
1 Promoters
- Indian Promoters 48,000,000 16.216
- Foreign Promoters - -
2 Persons acting in concert - -
Sub-Total 48,000,000 16.216
B. Non-Promoters Holding Institutions
(a) Mutual Funds and UTI 45,030,912 15.213
(b) Banks and Financial
Institutions 27,665,044 9.346
(c) Insurance Companies 56,286,009 19.015
(d) FIIs 60,725,676 20.515
Sub-Total B(1) 189,707,641 64.089
2 Non Institutions
(a) Bodies Corporate (incl.DVC) 21,369,833 7.219
(b) (i) Individuals 28,279,416 9.554
(Holding nominal share capital
uptoRS One lac)
(b) (ii) Individuals 6,675,236 2.255
(Holding nominal share capital
in excess of Rs One lac)
(c) Others
-NRIs 1,905,619 0.644
-OCBs - -
-Trusts and Foundations 70576 0.024
Sub-Total B (2) 58,300,680 19.696
Total Public Shareholding
(B1 B2) 248,008,321 83.784
GRAND TOTAL (A B) 296,008,321 100
Net Worth and Earnings Per Share (EPS)
As on 31st March 2014, net worth of your Company aggregates to Rs.
2508.41 crore as compared to Rs. 2325.68 crore for the previous year
thereby registering a growth of 7.86%.
EPS of the Company as on 31.03.2014 stands at Rs. 8.49 in comparison to Rs.
4.36 as on 31.03.2013.
MANAGEMENT DISCUSSION AND ANALYSIS
The world economy in 2013 experienced another year of subdued growth
(2.1%). There are however signs of recovery from the protracted
recession particularly for the Euro zone. Economic activity and global
trade picked up in the second half of FY14 though some emerging
economies faced new headwinds last year (e.g. depreciating currencies).
Stock markets are doing reasonably well in emerging economies
particularly India and Indonesia. The global economy in 2014 appears to
be in much better shape than last couple of years.
Domestically also, there is renewed optimism and positive outlook among
Indian companies especially in the power sector. In terms of generation
capacity addition, the target was overÂachieved third year in a row.
The country added 17,825 MW against the target of 11,663 MW. Private
sector again leads the pack and added more than double of its target.
In the fi rst two years of 12th plan, ~43% of the capacity addition
target for the entire plan has already been achieved. For power
transmission sector, the year 2014 started on a positive note as we
achieved synchronization of SR grid with rest of the country (NEW
grid). However, we may still have to wait for another couple of years
to take full advantage of that.
The Financial Restructuring Package (FRP) offered by Central Govt. last
year has started moving things in the distribution sector as the
utilities have started clearing past dues. Apart from that, the
utilities have also started buying power through various routes (long,
medium, shortÂterm tendering and power exchanges). There was some
apprehension among the banks which agreed to FRP after downward tariff
revision by few States ahead of elections. MoP has, though, pushed
States to take subsidy, if any on their books rather than on discoms''.
We see a positive impact of all these developments on our volumes.
On policy front, MoP has come out with Model Agreement for MediumÂterm
and Peaking Power Procurement after circulating the draft and inviting
comments. On the same lines, draft Model Agreement for Supply of
Merchant (ShortÂterm) Power and Request for Proposal have also been
circulated by the Ministry. It is good to see that government is taking
initiatives to rectify problems in the sector but a careful and
holistic approach needs to be adopted so that equal opportunities may
be provided to all market participants. In the longÂterm, mediumÂterm
and peaking power bidding documents, power traders are not allowed to
participate independently. The Electricity Act 2003 and CERC Power
Market Regulations stress on increasing competition but this provision
may lead to less competition in competitive biddings. Your company has
raised this issue at appropriate levels in the government and is
hopeful of a positive reply.
The Electricity Act 2003 itself is being amended and the Government has
proposed draft amendments for the same. One of the main thrust of the
amendments is to separate the carriage and content business in
distribution sector and have two licensees: Distribution Licensee who
will own the lines and Supply Licensee who will be responsible for
supply of electricity to the consumers. There are, however, certain
amendments which needs a relook. Amendment in Section 62 rules out
tariff determination by Appropriate Commission if National Electricity
Policy or Tariff Policy specifi es that procurement has to be through
bidding route. Your company has submitted that the Act has envisaged
both routes for a discom to procure power and hence both should be
allowed. The expected benefits of attractive tariffs through bidding
were shortÂlived as IPPs are fi nding it diffi cult to operate at
quoted tariffs.
Similarly, draft amendments have been brought out in Tariff Policy as
well. The amendments stress on independent formula for crossÂsubsidy
surcharge (CSS) by each SERC, no Universal Supply Obligation (USO) by
discoms for Open Access (OA) consumers, procuring renewable power
through competitive bidding and fulfi lling Renewable Purchase
Obligations (RPOs). Your company has submitted that CSS may be linked
to cost of power procurement and uniformly accepted panÂIndia
parameters. Renewable power purchase may continue through regulated
tariff route to give thrust to development of this sector.
CERC has come out with new tariff regulations for the period 2014Â19
through which it has tightened the performance parameters for power
plants. Tariff/ incentive will be paid on the basis of PLF rather than
PAF (Availability). It is notable that All India PLF is hitting new
lows due to fuel vows (coal, gas, LNG etc.). CERC''s composite index for
imported coal will now include Indonesian coal as well with 50%
weightage. Australian and South African coal will be given 25%
weightage each.
The Hon''ble Commission also introduced amendments in some other
regulations like CERC Trading License Regulations, Ancillary Services,
Deviation Settlement Mechanism etc. Your company has been submitting
its comments on such draft regulations/papers to make them more
conducive for power market growth.
ShortÂterm (ST) market crossed the 100 BUs mark in FY14 reaching ~105
BUs, a growth of 6% YoY. Power Exchanges (PXs) remain the highest
growing component of the market with a growth of ~30%. Direct Bilateral
grew by ~20%. Bilateral (Traders TAM) segment registered its fi rst
ever contraction of ~2.5%. This is because due to poor financial
health, State utilities preferred to purchase low priced exchange power
as and when required. The segment, however, picked up in last quarter
of FY14 on account of buying by some States like Andhra Pradesh,
Rajasthan, UP etc. It is still the largest component of ST market
constituting 34% of the market at the end of FY14. UI contracted by
~13% and is reduced to ~20% of the ST market  result of tightening of
UI regulations after grid disturbances of FY13.
Price in bilateral market remained slightly higher than PX for most
part of the year indicating that buyers are ready to pay premium for
certainty of power. Also bilateral prices were less volatile than PX
prices. Average prices in bilateral market over the year remained in
the range of Rs. 3.5Â4.5 per unit while on exchanges, prices varied from
Rs. 2Â3.7 per unit. Overall, the price level was lower when compared to
last year. Low prices on exchanges for most part of the year was
another reason pulling utilities towards them for trading. However, we
are already witnessing a reversal of this trend in the initial months
of FY15 where PX prices are rising. Increased input costs (fuel etc.)
are also expected to increase the delivered price of electricity. This
will make bilateral segment more lucrative than exchanges as buyers
will have certainty of getting power.
It has been another fruitful year in terms of the Agreements signed by
your Company for the sale of power to the State Utilities through
Competitive Bidding Processes. Your Company, having participated with a
cumulative capacity of 4379 MW in bids invited by various State
Utilities during last year, has fi nalized and executed Power Sale
Agreements to the tune of 1611 MW capacity with State Utilities such as
UP Discoms (751 MW), Rajasthan Discoms (660 MW), Tamil Nadu (100 MW) on
long term basis & with KSEB (100 MW) on medium term basis during FY14.
The power supply under the aforementioned agreements to KSEB and Tamil
Nadu shall commence during FY15 and to UP & Rajasthan during FY17. No
new CaseÂ1 Biddings processes were initiated by the State Utilities
during FY14.
As far as performance of your company is concerned, it traded ~35 BUs
(23% increase YoY) of electricity with a market share of ~38%
(including crossÂborder). LongÂterm segment saw the highest growth of
28.5% followed by PX (22%) and ST bilateral trades (~22%). Most of the
power traded by us was on Round The Clock (RTC) basis  96% which is
three percentage points higher than last year  the remaining power
being Peak and other. During the year, we revisited our Power Tolling
business and considering riskÂreward scenario, converted it into
longÂterm PPAs.
Our top 5 suppliers of electricity in FY14 were Simhapuri Energy Pvt.
Ltd., Government of Himachal Pradesh, West Bengal State Electricity
Distribution Company Ltd., Chhatisgarh State Power Distribution Company
Ltd. and State Development Power Corporation J&K. Our top buyers in
FY14 were Andhra Pradesh, West Bengal, Madhya Pradesh, Punjab and
Kerala.
CrossÂborder trade with Bhutan witnessed an increase of ~16% to 5579
MUs. Your company is also participating in a tender fl oated for sale
of power by Druk Green Power Corporation Limited (DGPCL) Bhutan from
118 MW Nikachhu
HEP on longÂterm basis. Trade with Nepal also increased to 97 MUs from
79 MUs last year. We have also started supplying 250 MW power to
Bangladesh for a period of three years starting from December 2013
after winning in the tender fl oated by Bangladesh Power Development
Board (BPDB). Volume for this transaction this year was 652 MUs.
CrossÂborder transactions remain a vital part of our portfolio and we
see an increase in volumes in this segment in the next year.
PTC Retail, our Strategic Business Unit (SBU) to cater to the
requirement of industries and commercial units has also been doing very
well. It has increased its client base to close to 350 and contributed
~3000 MUs in FY 14. The clients range from big PSUs like Indian
Railways, NHPC, Hindustan Copper etc. to corporate like CocaÂCola,
Apollo Tyres, L&T etc. With more favorable environment in the country
for allowing Open Access to eligible consumers, we see a bright future
for this SBU.
Your company is also playing an increasingly important role in the
promotion of Renewable Energy in the country. We are facilitating sale
of solar power between solar developers and solar power consumers
through mutually benefi cial trading arrangements and providing
advisory solutions for development/marketing of solar projects. Your
company is also facilitating various entities in meeting their
Renewable Purchase Obligations (RPOs) through sale of Renewable Energy
Certifi cates (RECs) and has traded more than 2,28,322 RECs in FY 14
which is ~8% more than RECs traded in FY12 (~2,12,000 RECs).
PFS recorded revenue of INR 5,462 million during FY 14 compared to
revenue of INR 2,865 million during FY 13. The company earned profit
of INR 822 million by way of divestment of its stake in one of the
investee company. The profit before tax for FY14 stood at INR 2,849
million and profit after tax nearly doubled to INR 2,077 million
respectively. Net interest income increased to INR 2,132 million,
thereby recording a growth of 39% during FY 14. Earnings per share for
the financial year stood at Rs. 3.70 per share.
During FY 2013Â14, PEL imported and sold 0.43 million MT of coal as
against 0.79 million MT in FY 2012Â13. The year gone by had proved to
be challenging. PEL, however, has been exploring avenues for adding
new suppliers and buyers under its umbrella of fuel intermediation on
competitive basis and other opportunities in energy sector.
Going forward, your company''s focus would be on balanced development of
trading business portfolio for sustained growth. LongÂterm trade is
expected to constitute half of our total volumes by FY 17. As per the
signals from the new government, the policy and regulatory environment
in the sector is expected to change positively and your company is well
positioned to benefit from such developments.
Domestic Trading
Your Company has completed another signifi cant year of its operations.
Financial year 2013Â14 had been a challenging year for Power sector due
to poor financial health of most of the state utilities, coal shortage
and transmission constraints in various Inter Regional Links. Still the
company has maintained and sustained its position in the industry.
There has been rise in the domestic trades by maintaining the
continuous interaction with customers, providing innovative solutions
and managing the key portfolio of some states. Your Company remains the
front runner in the power trading market.
PTC achieved highest trading volume ever of 35130 MUs during 2013Â14
against the previous year''s fi gure of 28597 MUs which is a signifi
cant jump of 22.85% over the previous year. PTC achieved best ever
Short term volume fi gure of 13387 MUs during 2013Â14. The Company also
carried out a signifi cant number of energy banking transactions during
the year and has achieved best ever trading volumes in terms of Energy
Banking.
PTC''s volume on power exchanges during 2012Â13 reached 6623 MUs against
the previous year fi gure of 3595 MUs which has witnessed an increase
of 84% over the previous year. Long term power from projects have
started contributing to trading volumes and the total MU traded from
projects under long term PPA has been 3771MUs.
As a responsible corporate, PTC is committed to promote renewable
energy for a greener tomorrow. As a maiden feat, PTC supplied around 46
MUs of renewable energy on bilateral basis to Punjab for fulfi llment
of their Renewablepurchase obligation.
Your Company extended its existing agreements with Chhattisgarh,
Government of Himachal Pradesh and various CPPs/IPPs for sale of their
surplus power. Negotiations are in advance stage with some other
surplus States/Utilities for signing agreements on similar lines. Your
company has also been able to add many other utilities and CPP/IPPs as
clients both through Bilateral and Power exchange routes. The
remarkable additions to the list of clientele are Haryana Power
Generation Corporation Limited, Nagaland, DB Power etc. During the year
FY 2013Â14 PTC revived bilateral transactions with Government of Sikkim
for supply of power to one of India''s largest Steel Industry. You will
be pleased to know that PTC is the only Power trading company to supply
power to Kerala under Medium Term Open Access (MTOA) during FY 2013Â14.
Long Term Agreements for Purchase of power
(A) Commissioned Projects
i. Power Projects commissioned before FY 2013Â14
(a) StageÂI Baglihar HEP (450 MW) was commissioned in the April 2009.
PTC has a contracted capacity of 225 MW, out of which 150 MW is being
sold under long term contracts to West Bengal (100 MW) and Haryana (50
MW) and balance 75 MW is being sold through short term contracts.
(b) Middle & Lower Kolab HEP (37 MW) was commissioned during FY 2009Â10
with lower Kolab Project achieving COD in January 2009 and Middle Kolab
Project achieving COD in February 2009. The Energy from the project
aggregating to 37 MW is being supplied to Orissa through long term
agreement.
(c) Samal HEP in Orissa for 20 MW was commissioned in October, 2009.
Entire capacity from the project is being supplied to Orissa through a
long term agreement.
(d) Pathadi Thermal Power Plant (PhaseÂI, 300 MW) set up by M/s. Lanco
Amarkantak Power Ltd. was commissioned in June 2009. PTC is selling the
entire 300 MW power from the project on long term basis to Madhya
Pradesh.
(e) SUGEN Gas Based Power Project developed by Torrent Group was
commissioned in August, 2009. PTC is selling 100 MW power from the
project to Madhya Pradesh.
(f) Pathadi Thermal Power Plant (PhaseÂII, 300 MW) set up by M/s. Lanco
Amarkantak Power Limited was commissioned in May 2011. PTC has signed
Power Sale Agreement with Haryana and presently 65% power from the
Project is being supplied to Haryana through PTC.
(g) Simhapuri Energy Private Limited''s Unit 1 and Unit 2 of 150 MW each
located in Andhra Pradesh were commissioned during FY 2012Â13 with
UnitÂ1 achieving COD in May 2012 and UnitÂ2 achieving COD in July 2012.
The aforementioned Power Tolling Agreement was converted into a Power
Trading Agreement between the Parties during FY 2013Â14. Presently, PTC
is selling power from these projects on short term basis.
(h) Malana  II HEP in Himachal Pradesh (100 MW) was commissioned in
July 2012 and the entire power is being sold to Punjab through PTC.
(i) Adhunik Power & Natural Resources Ltd''s, Unit 1 of 270 MW of the
project in Jharkhand was commissioned during January 2013. PTC has tied
up 100 MW from this unit to West Bengal State Electricity Distribution
Board.
ii. Power Projects commissioned during FY 2013Â14
a) Adhunik Power & Natural Resources Ltd''s UnitÂ2 of the project in
Jharkhand has been commissioned on 19th May, 2013. PTC
has tied-up 100 MW power from this project under the Tamil Nadu Long
Term Case-1 bid and power fl ow is expected to commence during FY
2014-15.
b) Meenakshi Energy Pvt Ltd s project of 2x150 MW capacity in Andhra
Pradesh has been commissioned on 30th April, 2013. The aforementioned
Power Tolling Agreement was converted into a Power Trading Agreement
between the Parties during FY 2013-14. Presently, PTC is selling power
from these projects on short term basis.
c) GMR Kamalanga Energy Ltd s project in Orissa has been commissioned
on 30th April 2013. PTC has tied up 323 MW from project under Case-1
bidding route to Haryana Discoms. Power fl ow under the PSA to Haryana
Discoms commenced w.e.f. 7th February 2014.
(iii) Projects Expected to be commissioned in FY 2014-15
a) Simhapuri Energy Ltd s Phase-II Expansion Project: The 300 MW
imported coal based expansion project is being set-up as Phase-II
expansion at its existing 300 MW project in Andhra Pradesh. PTC has
tolling agreement for 150 MW capacity from the expansion project. PTC
will tie-up the power on short term basis.
b) Andhra Pradesh Power Development Company Ltd s 1600 MW (2X800 MW)
Project: PTC tied up 160 MW (10%) from this project and has initialed a
Power Sale Agreement with Kerala State Electricity Board for sale of
the same.
c) DB Power Ltd s 1200 MW Project in Chhattisgarh: The Project is being
developed in two phases having a capacity of 600 MW each. PTC has two
Power Purchase Agreements for purchase of 260 MW from each Phase. PTC
has tied-up 410 MW power of the total contracted capacity with
Rajasthan Discoms. The power fl ow to Rajasthan Discoms shall commence
from November 2016 and power would be sold on short term basis for the
interim period.
d) Maruti Clean Coal & Power Ltd s 300 MW Project in Chhattisgarh: PTC
has tied up 250 MW power for sale to Rajasthan Discoms through Case-1
bidding process on long term basis. The power fl ow to Rajasthan
Discoms shall commence from November 2016 and power would be sold on
short term basis for the interim period.
e) Torrent Energy Ltd. s 1200 MW D-Gen Project in Gujarat: PTC has
power purchase agreement for 150 MW power from the Project for onwards
sale.
f) Swastik Power and Mineral Resources Ltd. s 50 MW (2x25 MW) Project
in Chhattisgarh: PTC has executed Power Purchase Agreement for 30 MW
power from the project. The contracted capacity is to be tied-up for
onwards sale on short term basis by PTC. Phase-1 of 25 MW of the
Project is expected to be commissioned during FY 2014-15.
(B) Power Purchase Agreements finalized in 2013-14
During the year, PTC entered into Power Purchase Agreements with M/s.
Ideal Energy Private Limited for 240 MW power.
PTC has signed long term Power Purchase Agreements (PPAs) with the
generators for a cumulative capacity of about 11,560 MW for further
sale of power to Discoms which includes Cross-Border power trade. The
projects are based on domestic coal, imported coal, gas and hydro
resources.
(C) Memorandum of Understanding / Agreement finalized in 2013-14
In addition to the above projects, PTC has also signed MoUs/MoAs with
number of Project developers during the FY 2013-14 for purchase of
power aggregating to approximately 1,332 MW. Cumulative MoUs/MoAs at
the end of the year by PTC is around 11,329 MW based on domestic coal,
imported coal, wind and hydro resources.
Agreements for Sale of Power
As per the Tariff Policy of Government of India, the long term power
procurement by the SEBs/ DISCOMs has to be necessarily done through
competitive bidding. As such, sale of power to the State Utilities has
to be through participation in the bidding process. Till now, PTC has
participated in competitive bids invited by State Utilities/Private
Discoms like Rajasthan, UP, AP, MP, Kerala and Tamil Nadu (Long term
and Medium term) and has bid for about 4,379 MW aggregate capacity.
I. Power Sale Agreements (PSAs) executed during FY 2013Â14
i). PTC has tiedÂup for purchase of 100 MW from M/s. Bharat Aluminium
Company Ltd''s thermal power plant in Chhattisgarh and sold the power to
Kerala State Electricity Board through Medium Term CaseÂ1 tender for 3
years. The Power supply is scheduled to commence from 1st March, 2014
as per the PSA subject to availability of Open Access.
ii). PTC has signed PSAs with UP Discoms for sale of 390 MW power from
TRN Energy Ltd''s plant in Chhattisgarh and 361 MW power from MB Power
Ltd''s Plant in Madhya Pradesh for 25 years under Case 1 competitive
bidding process. The Power fl ow under the PSAs is scheduled to
commence from 30th October, 2016.
iii). PTC has signed PSAs with Rajasthan Discoms for sale of 410 MW
power from DB Power Ltd''s plant in Chhattisgarh and 250 MW power from
Maruti Clean Coal & Power Ltd''s project in Chhattisgarh for 25 years
under Case 1 competitive bidding process. The Power fl ow under the
PSAs is scheduled to commence from 30th November, 2016.
iv). PTC has signed PSA with Tamil Nadu Generation and Distribution
Corporation Limited (TANGEDCO) for 100 MW power from M/s. Adhunik
Power & Natural Resources Ltd''s project for 15 years under CaseÂ1
Competitive Bidding Process. The Power fl ow as per the PSA is
scheduled to commence from 1st June, 2014 subject to availability of
Open Access.
v). PTC has signed PSA with Bangladesh Power Development Board (BPDB)
for supply of 250 MW power from the State Power Pool of West Bengal
State Electricity Distribution Company Limited (WBSEDCL) on medium term
basis (3 years) through International Competitive bidding process. The
Power fl ow under the PSA has commenced from 3rd December, 2013.
Human Resource
Organizational development in your Company has the focus on fostering a
successful system that maximizes human resources, as well as optimizes
other resources as part of larger business strategies. This important
aspect includes creation and maintenance of a change program which
allows your company to respond to evolving external and internal infl
uences.
The strategic Human Resource department is ideally positioned having
access to all areas and processes of the business. Some of the key
processes being successfully managed are manpower planning, recruitment
and development, training and career management, performance management
and compensation and benefits management, ESoP management and HRIS.
During the year, Internal Complaints Committee has been constituted to
look into grievance/complaints of sexual harassment lodged by women
employees as per Sexual Harasment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013.
Industrial relations
Your company has always maintained healthy, cordial, and harmonious
industrial relations at all levels. Despite of competition, the
enthusiasm efforts of the employees have enabled the Company to grow at
a fast rate.
Corporate Social Responsibility
We, at PTC, since inception, have endeavored to address social concerns
and work to the benefit of the local communities. We have been
undertaking various socioÂeconomic, educational and health initiatives
which focus on the welfare of the economically and deprived sections of
society. The Company facilitates programs and gives direct assistance
to individuals, societies and other charitable organizations.
Employee Stock Option Scheme 2008
Shareholder approval of the scheme was obtained at the Annual General
Meeting held on 6th August 2008 for introduction of Employee Stock
Option Plan at PTC India Ltd. Two grants have been made under the ESOP
2008.
Disclosures stipulated under the SEBI Guidelines have been made.
Period of Vesting for PTC India Ltd.
As per PTC India Ltd. Employee Stock Option Plan 2008, there shall be a
minimum period of 1 (one) year between the grant of options and vesting
of options. Subject to participant''s continued employment with the
Company or the subsidiary and restrictions if any set out in case of
terminal events, the Unvested Options shall vest with the Participants
over a four year period as per the following schedule.
Vesting No of years from % of options Cumulative % of
the grant date vested options vested
1st 1 15% 15%
2nd 2 15% 30%
3rd 3 30% 60%
4th 4 40% 100%
Exercise Period for PTC India Ltd.
Subject to the conditions laid down for terminal events (death,
permanent incapacitation of the employee etc.), the vested options
shall be exercisable within a period of 5 (fi ve) years from the fi rst
vesting date.
Period of vesting for PFS Ltd.
Options will vest over four years from the date of grant
End of year (from the date of grant) % of Vest
1 15%
2 15%
3 30%
4 40%
Exercise Period for PFS
Maximum of 3 years from the date of vesting or listing of shares on a
recognized stock exchange, whichever is later.
Conservation of Energy & Technology Absorption
As your Company is engaged in the activity of trading of power and
other related activities, the particulars relating to conservation of
energy and technology absorption respectively are not applicable to it.
Foreign exchange earnings & outgo etc.
Foreign Exchange earnings & outgo (on accrual basis) are as follows:
Expenditure in Foreign Currency - Rs 0.92 crore
CIF Value of Imports - Rs 92.72 crore
Income earned in foreignexchange - Rs301.54 crore
Particulars of the employees u/s 217 (2A)
Information as per Section 217(2A) of the Companies Act, 1956 read with
Companies (Particulars of Employees) Rules, 1975 as amended regarding
employees is as under:
During the Financial Year ending 31st March, 2014, no employee was
employed for full or part of the year, who was in receipt of
remuneration, which in aggregate or as the case may be, at a rate
which, in the aggregate was not less than Rs. 60 lakh per annum or Rs. 5
lakh per month except the following employees the details of whom are
given below:Â
Name Shri Deepak Amitabh Shri S. N. Goel
(Resigned w.e.f. 20th
January,2014)
Designation CMD Director (Marketing &
Operations)
Qualifi cation MSc. Ex IRS BE M.B.A.
Nature of Employment CMD Whole Time Director
Whether contractual
or otherwise
Nature of Overall Managerial Marketing & Operations
Duties of employees functions of company functions of the
Company
Last employment held Government of India NTPC Ltd.
Number of years of 30 35
experience
Age 53 59
Date of commencement 25.01.2008 27.09.2012
of employment
(at Board Level)
Gross Remuneration 0.79 0.51
(figuresin RS Crore)
No. of Equity Shares 79,557 NIL
held (of RS10/Â each)
Whether Relative of a No No
Director or Manager
Other terms and  Â
conditions of
Employment
Auditors
Statutory Auditors
M/s K.G. Somani & Co., Chartered Accountants, New Delhi were appointed
as Statutory Auditors of your Company in the 14th Annual General
Meeting of the Company and will cease to be Statutory Auditors of the
Company at ensuing Annual General Meeting and are eligible for
reappointment.
The Statutory Auditors have audited the Accounts of the Company for the
Financial year ended 31st March 2014 and Audited Accounts together with
the Auditors'' Report thereon are annexed to this report. The
observations of the Auditors in their Report on Accounts read with the
relevant notes to accounts are self explanatory and do not call for
any further comments.
The Company has received letter from them to the effect that their
reÂappointment, if made, would be within the prescribed limits under
Companies Act, 2013 and that they are not disqualifi ed for
reÂappointment and are eligible for appointment.
Internal Auditors
M/s. Ravi Rajan & Co. Chartered Accountants, New Delhi were appointed
as Internal Auditors of the Company for the Financial Year 2013Â14 and
their reports for the year were submitted to the Audit Committee.
Cost Auditors
The cost audit is not required for the company.
Subsidiary Companies
PTC India Financial Services Ltd. (PFS)
PTC India Financial Services Limited (PFS) is a subsidiary of PTC India
Limited wherein PTC holds 60% stake. PFS is listed on NSE and BSE and
has been classifi ed as Infrastructure Finance Company (IFC) by the
Reserve Bank of India.
The operational performance was quiet robust and the interest income
increased to Rs. 4,199.99 million during 2013Â14 compared to Rs. 2,513.16
million during 2012Â13, thereby recording an increase of 67%. In line
with the same, the borrowings also increased leading to increase in the
fi nance costs which increased to Rs. 2,209.55 million during 2013Â14
compared to Rs. 1,066.17 million during 2012Â13, thus recording an
increasing of 107%. Finance costs include amortization of foreign
currency translation which increased to Rs. 1,257.04 million in 2013Â14
compared to Rs. 544.40 million during 2012Â13, thus, recording an
increase of 131%. The Company made a profit of Rs. 821.69 million during
the year by divesting its stake in Meenakshi Energy Private Limited.
The profit before tax (PBT) stood at Rs. 2,848.85 million during 2013Â14
as compared to Rs. 1,552.89 million during 2012Â13, thus recording a
growth of 83% whereas profit after tax nearly doubled to Rs. 2,077.19
million during 2013Â14 as compared to Rs. 1,041.57 million during
2012Â13.
The disbursements were quite robust at Rs. 30,706 million during 2013Â14
compared to Rs. 13,000.71 million during 2012Â13 and the debt assistance
sanctioned to various projects during 2013Â14 aggregated to Rs. 25,202
million compared to Rs. 37,361 million in 2012Â13. The loan book stood at
Rs. 49,744 million as at 31st March 2014 whereas the equity investments
stood at Rs. 3,054 million as on the said date. The cumulative aggregate
debt assistance sanctioned as at 31st March 2014 stands at Rs. 103,030
million.
The Board of Directors of the Company has recommended a dividend @ 10%
i.e. Re.1.00 per equity share of Rs.10/Â each for the financial year
2013Â14.
The financial assistance sanctioned by PFS would help capacity
creation of more than 30,000 MW. The Company continues to diversify its
portfolio and as a result, the composition of renewable projects in the
outstanding loan book stands at around 35%, thermal projects constitute
about 33%. It is worthwhile to mention that renewable portfolio
constitutes a maximum portion of PFS'' loan book. The company has also
forayed into fi nancing infrastructure facilities like private railway
sidings, and development & operation of coal mines and power
transmission projects. The Company continues to regularly monitor the
progress and operations of the assisted projects through its
comprehensive project monitoring mechanism.
PTC Energy Limited (PEL)
PTC Energy Limited (PEL) was set up as a subsidiary of PTC India Ltd.
to develop asset base taking in to its sphere the developmental
activities, fuel intermediation etc.
The vision of PEL is to play a pivotal role in India''s emerging Energy
sector through asset base business and as a fuel aggregator.
On the backdrop of the huge demand for energy in India and the fact
that domestic coal supplies are struggling to keep pace with an ever
increasing demand, PEL has entered in to the business of fuel
intermediation to seize the opportunities in the fi eld of coal import.
The FY 2013Â14 has proved to be challenging for PEL affecting the
performance of the Company. During FY 2013Â14, PEL has imported and
sold 0.43 million MT of coal as against 0.79 million MT in FY 2012Â13.
The coal revenues for the year are Rs. 135.94 crore compared to Rs. 247.02
crore during the previous year. The profit before tax during the
current year is Rs. 2.89 crore as compared to Rs. 12.80 crore in FY
2012Â13.
PEL had invested Rs. 23.40 crore constituting 48% equity in RS India
Global Energy Limited with a view to undertake joint development of
wind farm in Tamil Nadu.
PEL is pursuing opportunities for investment in energy sector with a
focus on improving portfolio, increasing effi ciency and expanding
business.
Annual Accounts and information of the Subsidiary Companies under
Section 212 of the Companies Act, 1956
The Ministry of Corporate Affairs, Government of India, vide its
Circular dated 8th February, 2011 has granted exemption to all
Companies from attaching the financial statements of its subsidiaries
companies, pursuant to Section 212 (8) of the Companies Act, 1956,
subject to compliance of certain conditions by the Companies as
prescribed in this circular.
Accordingly, the Board of Directors in their meeting held on 24th May,
2014 has given their consent and passed the appropriate resolution for
not attaching the copies of balance sheet, profit & loss accounts and
reports of the Board of Directors and auditors of subsidiaries with the
balance sheet of the Company. In terms of said circular, your Company
has fulfi lled the prescribed conditions and also made necessary
disclosures in the Consolidated Balance Sheet and further undertakes
that the Annual Accounts of the Subsidiary Companies and the related
detailed information shall be made available to Shareholders of the
Company interested in obtaining the same. As directed by the Central
Government, the financial data of the subsidiaries has been furnished
in the notes on consolidated financial statements, which forms part of
the Annual Report of the Company. The Annual Accounts of Company
including that of Subsidiaries will be kept for inspection during
business hours at the registered offi ce of the Company and of the
respective Subsidiary Company. Further, pursuant to Accounting
StandardÂ21 (ASÂ21), Consolidated Financial Statements presented by the
Company include financial information about its subsidiaries.
Investment in other Companies (Amount Released up to 31st March, 2014)
1. Your Company has earlier executed Equity Subscription Agreement
(ESA) for investment in Athena Energy Ventures Pvt. Ltd. (AEVPL). As of
now, PTC has released Rs. 150 crore and the other investors of this
Company are Athena Group and IDFC.
2. Your Company has earlier executed Equity Subscription Agreement
(ESA) for investment in Krishna Godavari Power Utilities Limited upto Rs.
400 Million and as of now PTC has released Rs. 37.55 crore.
3. Teesta Urja Limited is developing 1200 MW TeestaÂIII Hydro Electric
Project in the State of Sikkim. Your Company has acquired 11%
subscribed equity in Teesta Urja Limited and has released Rs. 224.02
crore.
4. Your Company has 2% equity in M/s. Chenab Valley Power Projects
Private Limited (CVPPPL) with NHPC and JKSPDC and as of now PTC has
released Rs. 10 lakh.
Directors'' Responsibility Statement
In pursuance of Section 217 (2AA) of the Companies Act 1956, the
Directors make the following responsibility statement that:
1. In the preparation of the Annual Accounts, the applicable
Accounting Standards have been followed by PTC along with proper
explanation relating to material departures;
2. The Directors had selected such Accounting Policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the Financial Year 2014 and of the profit
of the Company for that period;
3. Proper and suffi cient care had been taken by the Directors for
maintenance of adequate Accounting records in accordance with the
provisions of the Companies Act 1956 for safeguarding the assets of the
Company and for preventing and detecting frauds and other
irregularities and
4. The Annual Accounts had been prepared on a going concern basis.
Acknowledgments
The Board of Directors acknowledge with deep appreciation the
coÂoperation received from the Government of India, particularly the
Ministry of Power and the Ministry of External Affairs, State
Electricity Utilities, State Governments, Regional Power Committees,
Central Electricity Authority, Central Electricity Regulatory
Commission, State Electricity Regulatory Commissions, Promoters viz.
Power Grid Corporation of India Ltd., NTPC Ltd., Power Finance
Corporation Ltd., NHPC Ltd., Life Insurance Corporation of India and
other valuable investors of the Company and look forward to their
continued support in future.
The Board wishes to place on record its appreciation for efforts and
contribution made by the employees at all levels. Our consistent growth
was made possible by their hard work, solidarity, coÂoperation and
support.
For and on behalf of the Board of Directors
(Deepak Amitabh)
Chairman & Managing Director
DIN: 01061535
Place: New Delhi
Date: 11th August 2014
Mar 31, 2013
Dear Shareholders,
The Directors have pleasure in presenting to you the Fourteenth Annual
Report on the activities of your Company along with the Audited Annual
Accounts for the Financial Year 2012-13.
Performance and Financial Highlights
Your Company has completed another innovative year of its operations,
wherein it has sustained and maintained its leadership position in the
industry. The trading volumes were higher by 17.56% this year at 28,597
MUs as against 24,325 MUs during the previous year. With a turnover of
Rs. 88,689 million (including other income) for the year 2012-2013 as
against Rs. 77, 011 (Including other income) in the Financial Year
2011-12, your Company has earned a Profit After Tax of Rs. 1,287
million as against Rs. 1,204 million in the previous year.
Your Company has two subsidiaries, namely PTC India Financial Services
Limited (60% owned) and PTC Energy Limited (Wholly Owned). The
consolidated turnover of the group is Rs. 92,133 million for the
current Financial Year as against Rs. 81,105 million for the Financial
Year 2011-12. The Consolidated Profit After Tax of the Group is Rs.
1,983 million for the current Financial Year as against Rs. 2,041
million for the Financial Year 2011-12.
The Financial Results of the Company for the FY 2012-13 vis-a-vis
2011-12 under broad heads are summarized as under:-
Financial results of the company for the FY 2012-2013 vis -a-vis
2011-2012
Particulars For the Year For the Year
ended 31.03.2013 ended 31.03.2012
(in Rs. Million) (in Rs. Million)
Sales (including rebate on purchase 88562.41 76501.57
of power, service charges and
surcharge)
Other Income (including income 126.25 509.08
from consultancy services)
Purchase (including rebate on sale 82157.31 74765.92
of power)
Employee Cost 129.74 119.00
Other Expenses etc. 228.94 424.10
Fuel cost 2723.06 -
Operating expenses 1639.87 -
Profit before amortization, 1809.74 1701.63
depreciation and prior
period items
Amortization and Depreciation 42.05 44.63
Prior Period Expenses/(Income) (16.90) 1.22
Profit Before Tax 1784.59 1655.78
Provision for Taxation (including 497.15 452.12
deferred tax income )
Profit After Tax 1287.44 1203.66
Balance as per last accounts 1722.23 1393.91
Transferred to General Reserves 386.23 361.10
Dividend (incl. dividend tax) 554.10 514.24
Transfer to contingent reserves - -
Balance carried forward to Balance 2069.34 1722.23
Sheet
Earning Per Share in Rs. 4.36 4.08
Appropriations
Dividend
Your Directors are pleased to recommend for your consideration and
approval dividend @ 16% (which is higher by 1% from the last year) for
the Financial Year 2012-13 i.e. Rs 1.60 per equity share of Rs. 10
each. The dividend, if approved, at ensuing Annual General Meeting
will absorb Rs. 554.10 million including Corporate Dividend Tax
amounting to Rs. 80.49 million.
The dividend will be paid to the members whose name appears in the
register of members as on a record date in respect of shares held in
dematerialized form whose name is furnished by the Depositories, as
beneficial owners.
Reserves
Out of the profits of the Company, a sum of Rs. 386.23 million has been
transferred to General Reserves during the year and total reserves and
surplus of the Company are Rs. 20,296.72 million (including share
premium) as on 31st March 2013.
Public Deposits
The Company has not accepted any public deposits during the year and as
such, no amount on account of principal or interest was outstanding as
on the date of Balance Sheet.
Capital Structure
As on 31st March 2013, PTC has Authorized Share Capital of Rs.
750,00,00,000 and Paid-Up Capital of Rs. 296,00,83,210/- divided into
296008321 equity shares of Rs.10 each. The equity shares of your
Company are listed on the ''Bombay Stock Exchange Limited'' (BSE) and
''The National Stock Exchange of India Ltd.'' (NSE). The promoters
i.e. NTPC Ltd. (NTPC) , Power Grid Corporation of India Ltd.
(POWERGRID), Power Finance Corporation Ltd. (PFC) and NHPC Ltd. (NHPC)
individually hold 4.05% each, or 16.20% collectively of the paid-up and
subscribed equity share capital of your Company and the balance of
83.80% of the paid-up and subscribed equity share capital of your
Company is held by power sector entities, Financial Institutions, Life
Insurance Corporation of India and other Insurance Companies, Banking
Institutions, Corporations, Investment Companies, Foreign Institutional
Investors, Private Utilities and others including public at large.
The shareholding pattern of your Company as on 31.03.2013 is as
follows:-
Category No. of shares Percentage of
held Shareholding
A Promoters'' holding
1 Promoters
- Indian Promoters 48,000,000 16.20
- Foreign Promoters - -
2 Persons acting in concert - -
Sub-Total 48,000,000 16.20
B. Non-Promoters'' Holding
1 Institutions
(a) Mutual Funds and UTI 46193550 15.61
(b) Banks and Financial Institutions 29389586 9.93
(c) Insurance Companies 64460624 21.78
(d) FIIs 47694164 16.11
Sub-Total B(1) 187737924 63.43
2 Non Institutions
(a) Bodies Corporate ( incl. DVC) 23138350 7.82
(b) (i) Individuals
(Holding nominal share capital upto 28243813 9.54
Rs. One lac)
(b) (ii) Individuals
(Holding nominal share capital in 6507936 2.20
excess of Rs. One lac)
(c) Others
-NRIs 2324523 0.79
-OCBs 0 0
-Trusts and Foundations 55775 0.02
Sub-Total B (2) 60270397 20.36
Total Public Shareholding (B1 B2) 248008321 83.78
GRAND TOTAL (A B) 296008321 100
Net Worth and Earnings Per Share (EPS)
As on 31st March 2013, net worth of your Company aggregates to Rs. 23,
256.80 Million as compared to Rs. 22,501.15 Million for the previous
year thereby registering a growth of 3.36%.
EPS of the Company as on 31.03.2013 stands at Rs 4.36 in comparison to
Rs.4.08 as on 31.03.2012.
Conservation of Energy & Technology Absorption
As your Company is engaged in the activity of trading of power and
other related activities, the particulars relating to conservation of
energy and technology absorption respectively are not applicable to it.
Foreign exchange earnings & outgo etc.
The Company has incurred an expenditure of Rs 2.16 Million (on accrual
basis) in foreign exchange during the financial year 2012-2013. No
foreign exchange was earned during the financial year.
Particulars of the employees u/s 217 (2A)
Information as per Section 217(A) of the Companies Act, 1956 read with
Companies (Particulars of Employees) Rules, 1975 as amended regarded
employees is as under:
During the Financial Year ending 2013, no employee was employed for
full or part of the year, who was in receipt of remuneration, which in
aggregate or as the case may be, at a rate which, in the aggregate was
not less than Rs. 60 lacs per annum or Rs. 5 lakh per month except the
following employees the details of whom are given below:-
Auditors
Statutory Auditors
M/s K.G. Somani & Co., Chartered Accountants, New Delhi were appointed
as Statutory Auditors of your Company in the 13th Annual General
Meeting of the Company and who will cease to be Statutory Auditors of
the Company at ensuing Annual General Meeting and are eligible for
reappointment.
The Statutory Auditors have audited the Accounts of the Company for the
Year ended 31st March 2013 and Audited Accounts together with the
Auditors'' Report thereon are annexed to this report. The observations
of the Auditors in their Report on Accounts read with the relevant
notes to accounts are self- explanatory.
The Board recommends the appointment of M/s. K.G. Somani & Co. as the
Statutory Auditors of the Company for the Financial Year 2013-2014 by
the Shareholders in the 14th Annual General Meeting of the Company.
- Internal Auditors
M/s. Ravirajan & Co. Chartered Accountants, New Delhi were appointed as
Internal Auditors of the Company for the Financial Year 2012-2013 and
their reports for the year were submitted to the Audit Committee.
- Cost Auditors
The cost audit is not required for the company for the Financial Year
2013-2014.
Subsidiary Companies
PTC India Financial Services Ltd. (PFS)
PFS is a subsidiary of PTC India Limited wherein PTC holds 60% stake.
PFS is listed on NSE and BSE and has been classified as Infrastructure
Finance Company (IFC) by the Reserve Bank of India.
The operational and financial performance of PFS during the year
2012-13 has been quite robust and it continued the growth momentum. The
interest income earned by it increased to Rs.2, 513.16 million during
the current compared to Rs.1, 329.54 million during previous year
recording an increase of 89% whereas the interest expense increased by
52% to Rs.977.07 million during current year compared to Rs.642.83
million during previous year. As a result, net interest income recorded
an increase of about 124% during the current year. The net interest
margin for FY 2012-13 stood at 8.50% compared to 7.38% during FY
2011-12 and the cost of funds reduced to 8.31% during FY 2012-13 as
against 10.13% during the previous year.
The total revenues for the year stood at Rs.2, 865.22 million compared
to Rs.3, 071.99 million during the previous year. However, it may be
mentioned that during previous year, PFS had earned revenue of Rs.1,
276.98 million by way of profit on sale of equity investments while no
such revenues were earned during the current year. Excluding such
revenue, the revenue increased by about 60% during the year. The profit
before tax and profit after tax for the current financial year stood at
Rs.1, 552.89 million and Rs.1, 041.57 million respectively. Earnings
per share for the financial year stood at Rs.1.85 per share. The Board
of Directors of PFS have recommended a dividend @ 4% i.e. Rs.0.40 per
equity share of Rs.10 each for the financial year 2012-13.
PFS sanctioned debts aggregating to Rs.37,361 million during 2012-13
compared to Rs.36,923 million during 2011-12 and disbursed a sum of
Rs.13,000.71 million during 2012-13 compared to Rs.6,241.75 million
during 2011-12. The outstanding loan book aggregates to Rs.22, 959.45
million as at 31st March 2013 and there are "Nil" NPAs as at 31st
March 2013.
During FY 2012-13, PFS executed external commercial borrowing (ECB)
agreement with International Finance Corporation for long term loan of
upto Rs.1, 620 million on fully hedged basis. As at 31st March 2013,
the effective term loans sanctioned by PFS aggregate to Rs.9, 999
crores, supporting capacity creation of more than 30,000 MW. PFS has
been diversifying its portfolio with a focus on lending to renewable
power projects and has also sanctioned loans for infrastructure
facilities like development of private railway sidings, development &
operations of coal mines and power transmission projects.
PTC Energy Limited (PEL)
PTC Energy Limited (PEL) is a subsidiary of PTC India Ltd. which has
been set up to undertake various activities related to the business of
power generation, sale and purchase of all form of energy including
coal/ fuels and other allied works.
The vision of PEL is to play a pivotal role in India''s emerging
Energy sector through asset base business and as a fuel aggregator.
Domestic coal supplies are struggling to keep pace with an ever
increasing demand from the country''s power sector. On the backdrop of
the huge demand for energy in India and the fact that coal will remain
as a prime fuel source to domestic energy market, PEL has entered in to
the business of fuel intermediation to seize the opportunities in the
field of coal import.
PEL has entered in to this business avenue in FY 2009-10 and since then
PEL has maintained the growth momentum. During FY 2012-13, PEL has
imported and sold 0.79 million MT of coal as against 0.42 million MT in
FY 2011-12. The coal revenues for the year increased to Rs. 2470.21
million compared to Rs. 1608.48 million during the previous year, thus
recording a growth of 53.57%. The profit before tax has increased by
199% during the current year to Rs. 128.07 million from Rs. 42.76
million in FY 2011-12. Earnings per share increased to Rs. 1.57 during
FY 2012-13 from Rs. 0.55 in FY 2011-12.
PEL is also holding an investment of Rs. 234.0 million constituting 48%
equity in RS India Global Energy Limited with a view to undertake joint
development of wind farm in Tamil Nadu. The Company is pursuing
opportunities for investment in energy sector with a focus on improving
portfolio, increasing efficiency and expanding business in order to be
the most preferred partner in the energy value chain.
Annual Accounts and information of the Subsidiary Companies under
Section 212 of the Companies Act, 1956
The Ministry of Corporate Affairs, Government of India, vide its
Circular dated 8th February, 2011 has granted exemption to all
Companies from attaching the financial statements of its subsidiaries
companies, pursuant to Section 212(8) of the Companies Act, 1956,
subject to compliance of certain conditions by the Companies as
prescribed in this circular.
Accordingly, the Board of Directors in their meeting held on 23rd May,2
013 has given their consent and passed the appropriate resolution for
not attaching the copies of balance sheet, profit& loss accounts and
reports of the board of directors and auditors of subsidiaries have not
been attached with the balance sheet of the Company. In terms of said
circular, your Company has fulfilled the prescribed conditions and also
made necessary disclosures in the Consolidated Balance Sheet and
further undertakes that the Annual Accounts of the Subsidiary Companies
and the related detailed information shall be made available to
Shareholders of the Company interested in obtaining the same. As
directed by the Central Government, the financial data of the
subsidiaries has been furnished in the notes on consolidated financial
statements, which forms part of the Annual Report of the Company. The
Annual Accounts of Company including that of Subsidiaries will be kept
for inspection during business hours at the registered office of the
Company and of the respective Subsidiary Company. Further, pursuant to
Accounting Standard-21 (AS-21), Consolidated Financial Statements
presented by the Company include financial information about its
subsidiaries.
Investment in other Companies (Amount Released up to March, 2013)
1. Your Company has earlier executed Equity Subscription Agreement
(ESA) for investment in Athena Energy Ventures Pvt. Ltd. (AEVPL). As of
now PTC has released Rs. 1500 Million and the other investors of this
Company are Athena Group, IDFC and IFCI.
2. Your Company has earlier executed Equity Subscription Agreement
(ESA) for investment in Krishna Godavari Power Utilities Limited upto
Rs. 400 Million and as of now PTC has released Rs. 375.48 Million.
3. Teesta Urja Limited is developing 1200 MW Teesta-III Hydro Electric
Project in the State of Sikkim. Your Company has acquired 11%
subscribed equity in Teesta Urja Limited and has released Rs. 2240.15
Million.
4. Your Company has 2% equity in M/s. Chenab Valley Power Projects
Private Limited (CVPPPL) with NHPC and JKSPDC and as of now PTC has
released Rs. 1Million.
Directors'' Responsibility Statement
In pursuance of Section 217 (2AA) of the Companies Act 1956, the
Directors make the following responsibility statement that:
1. In the preparation of the Annual Accounts, the applicable
Accounting Standards have been followed by PTC along with proper
explanation relating to material departures;
2. The Directors had selected such Accounting Policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the Financial Year 2013 and of the profit
of the Company for that period;
3. Proper and sufficient care had been taken by the Directors for
maintenance of adequate Accounting records in accordance with the
provisions of the Companies Act 1956 for safeguarding the assets of the
Company and for preventing and detecting frauds and other
irregularities and
4. The Annual Accounts had been prepared on a going concern basis.
Acknowledgments
The Board of Directors acknowledge with deep appreciation the
co-operation received from the Government of India, particularly the
Ministry of Power and the Ministry of External Affairs, State
Electricity Utilities, State Governments, Regional Power Committees,
Central Electricity Authority, Central Electricity Regulatory
Commission, State Electricity Regulatory Commissions, Promoters viz.
Power Grid Corporation of India Ltd., NTPC Ltd., Power Finance
Corporation Ltd., NHPC Ltd. , Life Insurance Corporation of India and
other valuable investors of the Company and look forward to their
continued support in future.
The Board wishes to place on record its appreciation for efforts and
contribution made by the employees at all levels. Our consistent growth
was made possible by their hard work, solidarity, co-operation and
support.
For and on behalf of the Board of Directors
(Deepak Amitabh)
Chairman & Managing Director
DIN: 01061535
Place : New Delhi
Date : 24.06.2013
Mar 31, 2012
Dear Shareholders,
The Directors have pleasure in presenting to you, the Thirteenth
Annual Report on the activities of your Company along with the Audited
Annual Accounts for the Financial Year 2011-12.
Performance and Financial Highlights
Your Company has completed another innovative year of its operations,
wherein it has sustained and maintained its leadership position in the
industry. The trading volumes were marginally lower by (0.64%) this
year at 24325 MUs as against 24481 MUs during the previous year. With a
turnover of Rs. 77011 million (including other income) for the year
2011-2012 as against Rs. 90603 million (including other income) in the
financial year 2010- 11, your Company has earned a profit after tax of
Rs. 1204 million as against Rs. 1385 million in the previous year.
Your Company has two subsidiaries, namely PTC India Financial Services
Limited (60% owned) and PTC Energy Limited (Wholly Owned). The
consolidated turnover of the group is Rs.81105 million for the current
financial year as against Rs. 92627 million for the financial year
2010-11. The consolidated profit after tax of the group is Rs. 2041
million for the current financial year as against Rs. 1660 million for
the financial year 2010-11.
The financial results of the company for the FY 2011-12 vis-a-vis
2010-11 under broad heads are summarized as under:-
Financial results of the company for the FY 2011-2012 vis -a-vis
2010-2011
Particulars For the Year For the Year
ended 31.03.2012 ended 31.03.2011
(in Rs. Million) (in Rs. Million)
Sales (including rebate
on purchase 76501.57 89972.75
of power, service charges and
surcharge)
Other Income ( including income 509.08 630.41
from consultancy services)
Purchase (including rebate
on sale 74765.92 88370.81
of power)
Employee Cost 119 69.58
Other Expenses etc. 424.10 144.37
Profit before amortization, 1701.63 2018.40
depreciation and prior
period items
Amortization and Depreciation 44.63 50.34
Prior Period Expenses/(Income) 1.22 0.09
Profit Before Tax 1655.78 1967.97
Provision for Taxation (including 452.12 582.78
deferred tax income )
Profit After Tax 1203.66 1385.19
Balance as per last accounts 1393.91 938.52
Transferred to General Reserves 361.10 415.56
Dividend (incl. dividend tax) 514.24 514.24
Transfer to contingent reserves
Balance carried forward
to Balance 1722.23 1393.91
Sheet
Earning Per Share in Rs. 4.08 4.70
Appropriations
Dividend
Your Directors are pleased to recommend for your consideration and
approval dividend @ 15% for the financial year 2011-12 i.e. Rs 1.5/-
per equity share (which is same as paid in last year) of Rs. 10 each.
The dividend if approved at ensuing Annual General Meeting, will absorb
Rs.514.24 million including corporate dividend tax amounting to
Rs.71.78 million.
The dividend will be paid to members whose name appears in the register
of members as on a record date; in respect of shares held in
dematerialized form whose name is furnished by the Depositories, as
beneficial owners.
Reserves
Out of the profits of the Company, a sum of Rs.361.10 million has been
transferred to General Reserves during the year and total reserves and
surplus of the Company are Rs.19551.41 million (including share
premium) as on 31st March 2012.
Public Deposits
The Company has not accepted any public deposits during the year and as
such, no amount on account of principal or interest was outstanding as
on the date of Balance Sheet.
Capital Structure
As on 31st March 2012, PTC has Authorized Share Capital of Rs.
750,00,00,000 and Paid-Up Capital of Rs. 294,97,35,710/- divided into
294,97,3571 equity shares of Rs.10 each. The equity shares of your
Company are listed on the 'Bombay Stock Exchange Limited' (BSE) and
'The National Stock Exchange of India Ltd.' (NSE). The promoters i.e.
NTPC Ltd. (NTPC), Power Grid Corporation of India Ltd. (POWERGRID),
Power Finance Corporation Ltd. (PFC) and NHPC Ltd. (NHPC) individually
hold 4.07% each, or 16.27% collectively of the paid-up equity and
subscribed share capital of your Company and the balance of 83.73% of
the equity paid-up and subscribed share capital of your Company is held
by Power Entities, Financial Institutions, Life Insurance Corporation
of India and other Insurance Companies, Banking Institutions,
Corporations, Investment Companies, Foreign Institutional Investors,
Private Utilities and others including general public at large.
The shareholding pattern of your Company as on 31.03.2012 is as
follows:-
Category No. of shares Percentage of
held Shareholding
A Promoter's holding
1 Promoters
- Indian Promoters 48,000,000 16.27
- Foreign Promoters -
2 Persons acting in concert -
Sub-Total 48,000,000 16.27
B. Non-Promoter's Holding
1 Institutions
Mutual Funds and UTI 46151970 15.65
Banks and Financial
Institutions 29809273 10.11
Insurance Companies 64452893 21.85
FIIs 42611137 14.45
Sub-Total B(1) 183025273 62.05
2 Non Institutions
Bodies Corporate ( incl. DVC) 23964899 8.12
Individuals 30617738 10.38
(holding nominal share capital
upto Rs. One lac)
Individuals 7109124 2.41
(Holding nominal share
capital in
excess of Rs. One lac)
Others
-NRIs 2194537 0.74
-OCBs 0 0.00
-Trusts and Foundations 62000 .02
Sub-Total B (2) 63948298 21.68
Total Public Shareholding 246973571 83.73
GRAND TOTAL 294973571 100.00
Net Worth and Earning Per Share (EPS)
As on 31st March 2012, net worth of your Company aggregates to
Rs.22,501.15 Mn as compared to Rs. 21,801.80 Mn for the previous year
thereby registering a growth of 3.21%.
EPS of the Company as on 31.03.2012 stands at Rs.4.08 in comparison to
Rs.4.70 as on 31.03.2011.
Acknowledgments
The Board of Directors acknowledge with deep appreciation the co-
operation received from the Government of India, particularly the
Ministry of Power and the Ministry of External Affairs, State
Electricity Utilities, State Governments, Regional Power Committees,
Central Electricity Authority, Central Electricity Regulatory
Commission, State Electricity Regulatory Commissions, Promoters viz.
Power Grid Corporation of India Ltd., NTPC Ltd., Power Finance
Corporation Ltd., NHPC Ltd. , Life Insurance Corporation of India and
other valuable investors of the Company and look forward to their
continued support in future.
The Board wishes to place on record its appreciation for efforts and
contribution made by the employees at all levels. Our consistent growth
was made possible by their hard work, solidarity, co-operation and
support.
For and on behalf of the Board of Directors
Sd/-
(Tantra Narayan Thakur)
Chairman & Managing Director
DIN: 00024322
Place: New Delhi
Date: 13th August, 2012
Mar 31, 2011
The Members, PTC India Ltd.
The Directors take great pleasure in presenting to you, the Twelfth
Annual Report on the activities of your company, together with the
Audited Annual Accounts for the Financial Year 2010-11.
Performance and Financial Highlights
Your Company has completed another successful year of its operations,
wherein it has sustained and maintained its leadership position in the
industry. The trading volumes were 34.25% higher this year at 24481MUs
as against 18236 MUs during the previous year. With a turnover of Rs.
90603 Million (including other income)for the year 2010-2011 as against
Rs.78445 Million (Including other income) in the financial year
2009-10, your Company has earned a profit after tax of Rs.1385 Million
as against Rs. 941 Million in the previous year.
Your Company has two subsidiaries, namely PTC India Financial Services
Limited (60% owned) and PTC Energy Limited (Wholly Owned). The
consolidated turnover of the group is Rs 92627 million for the current
financial year as against Rs. 79257 million for the financial year
2009-10. The consolidated profit after tax of the group is Rs1660.26
million for the current financial year as against Rs. 1072.69 million
for the financial year 2009-10.
The financial results of the company for the FY 2010-11 vis-a-vis
2009-10 under broad heads are summarized as under:- Financial results
of the company for the FY 2010-2011 vis Ãa-vis 2010-11
(in Rs. Million)
Particulars For the Year For the Year
ended 31.03.2011 ended 31.03.2010
Sales (including rebate on purchase 89972.75 77703.41
of power, service charges and
surcharge)
Other Income ( including income 630.41 741.66
from consultancy services)
Purchase (including rebate
on sale of 88370.81 76750.60
power)
Employee Cost 69.58 184.35
Other Expenses etc. 144.37 135.13
Profit before amortization, 2018.40 1374.99
depreciation and prior period items
Amortization and Depreciation 50.34 55.21
Prior Period Expenses/(Income) 0.09 1.85
Profit Before Tax 1967.97 1317.93
Provision for Taxation (including 582.78 376.92
deferred tax income )
Profit After Tax 1385.19 941.01
Balance as per last accounts 938.52 691.98
Transferred to General Reserves 415.56 282.30
Dividend (incl. dividend tax) 514.24 412.17
Transfer to contingent reserves - -
Balance carried forward to Balance 1393.91 938.52
Sheet
Earning Per Share in Rs. 4.70 3.31
Appropriations
Dividend
Your Directors are pleased to recommend for your consideration and
approval dividend @ 15% for the financial year 2010-11 i.e. Rs.1.50 per
equity share (as against Rs.1.20/-per equity share in the previous
year) of Rs. 10 each. The dividend if approved at ensuing Annual
General Meeting will absorb Rs.514.24 million including corporate
dividend tax amounting to Rs.71.78 million.
The dividend will be paid to members whose names appear in the register
of members as on a record date; in respect of shares held in
dematerialized form whose names are furnished by the Depositories, as
beneficial owners
Reserves
Out of the profits of the Company, a sum of Rs.415.56 Million has been
transferred to General Reserves during the year and total reserves and
surplus of the Company are Rs.18,852.06Million (including share
premium) as on 31st March 2011.
Fixed Deposits
The Company has not accepted any public deposits during the year and as
such, no amount on account of principal or interest was outstanding as
on the date of Balance Sheet.
As on 31st March 2011, net worth of your Company aggregates to
Rs.21,801.80 Mn as compared to Rs. 20962.37 Mn for the previous year
thereby registering a growth of 4.00%.
EPS of the Company as on 31.03.2011 stands at Rs.4.70 in comparison to
Rs. 3.31 as on 31.03.2010
TRANSFER OF UNPAID/UNCLAIMED DIVIDEND AMOUNT AND UNPAID/ UNCLAIMED
REFUND AMOUNT OF IPO TO IEPF:- Pursuant to provisions of Section
205(A)(5) of Companies Act 1956, the declared dividend of FY 2003-04
and unpaid/ unclaimed amount of refund of IPO, which remain unpaid for
the period of seven years has been transferred by company to the
Investor Education Provident Fund(IEPF) , established by Central
Government, pursuant to Section 205(C) of said Act.
Conservation of Energy & Technology Absorption
As your Company is engaged in the activity of trading of power and
other related activities, the particulars relating to conservation of
energy and technology absorption respectively are not applicable to it.
The company had successfully ventured into the field of wind power
generation in March, 2008. The 4 X 1.5 MW wind farm project of PTC is
located at Sinnar, Nashik in Maharashtra. The PPA for the project has
been executed with the state distribution utility (MSEDCL) for Rs. 3.50
/ kWh with an escalation of 15 paisa / kWh per annum for 13 years. The
project generated about 12.3 MUs of energy worth Rs. 4.70 Crores in
FY2010-11.
Foreign exchange earnings & outgo etc.
The Company has incurred an expenditure of Rs.4.70 Million (on accrual
basis) in foreign exchange during the financial year 2010-2011. No
foreign exchange was earned during the financial year.
Particulars of the employees u/s 217 (2A)
During the Financial Year ending 2011, no employee was employed for
full or part of the year, who was in receipt of remuneration, which in
aggregate or as the case may be, at a rate which, in the aggregate was
not less than Rs. 60 lacs per annum or Rs. 5 lakh per month except the
following employees the details of whom are given below:- Name Sh. T.
N. Thakur Designation CMD Qualification B.Sc. (Engineering ) Nature of
Employment
Whether contractual or otherwise CMD
Nature of Duties of employees Overall Managerial
functions of company
Last employment held Power Finance
Corporation Ltd.
Number of years of experience 39
Age 62
Date of commencement of employment 11.10.2000
Gross Remuneration (figures in Rs. Million) 11.03 Millions
No. of Equity Shares held (of Rs. 10/- each) 1,94,490
Whether Relative of a Director or Manager No No Other terms and
conditions of Employment -
Auditors:- - Statutory Auditors
M/s. T.R. Chadha & Company, Chartered Accountants were appointed as
Statutory Auditors of the Company for the Financial Year 2010-2011 by
the Shareholders in the eleventh Annual General Meeting of the Company
and shall hold office upto the conclusion of the forthcoming Annual
General Meeting of the Company.
The Statutory Auditors have audited the Accounts of the Company for the
Year ended 31 March 2011 and Audited Accounts together with the
Auditors' Report thereon are annexed to this report.
Qualification in Audit Report and Management representation thereon
As mentioned by the Statutory Auditors in their Audit Report regarding
consolidated accounts, an associate entity of PFS namely, RS India Wind
Energy Limited (RSIWEL) wherein PFS holds 37% equity stake, could not
provide its financial statement for the FY 2010-11. RSIWEL has informed
PFS that they could not finalise accounts for the aforesaid financial
year as their request for restructuring the credit facility (lease) and
terms and conditions thereof including for conversion of lease facility
in to term loan is under consideration of the lending institution
(lessor), and which may have material bearing on the accounts of the
financial year.
The issue of rotation of the Statutory Auditors has been discussed at
Board level and has been mutually agreed with the existing Statutory
Auditors. Shareholders will be required to elect auditors for the
current year and fix their remuneration. The Board has recommended M/s.
K.G.Somani & Co to act as Statutory Auditors for current FY and consent
is being taken from M/s. K.G.Somai & Co. to the effect that their
appointment, if made, would be in conformity with the limits prescribed
in section 224(1B) of the Companies Act , 1956.
The Board recommends the appointment of M/s. K.G.Somani & Co.as the
Statutory Auditors of the company for the Financial Year 2011-2012 by
the Shareholders in the Twelfth Annual General Meeting of the Company.
Internal Auditors
M/s. Ravirajan & Co. Chartered Accountants, Delhi were appointed as
Internal Auditors of the Company for the Financial Year 2010-2011 and
their reports for the year were submitted to the Audit Committee.
Cost Auditors
The cost auditors of the Company for the 4 X 1.5 MW wind farm project
of PTC is located at Sinnar, Nashik in Maharashtra are M/s. Ramnath
Iyer & Company.
Subsidiary Companies
PTC India Financial Services Ltd. (PFS)
PTC India Financial Services Limited (PFS), wherein the Company holds
60% stake, is one of the subsidiaries of PTC India Ltd.
PFS has been listed on NSE and BSE with its successful IPO raising in
March, 2011. Its capital base post IPO is Rs.1019 Crore. PFS has also
been granted status of Infrastructure Finance Company (IFC) from
Reserve Bank of India in the month of August, 2010. Pursuant to IFC
status, PFS issued long term infrastructure bonds carrying benefits of
Section 80CCF of Income Tax Act, 1961. PFS has also successfully
finalized ECB with DEG, and International Finance Corporation for USD
26 Million and USD 50 Million respectively.
The operational and financial performance of the Company during the
year 2010-11 has maintained rather exceeded growth momentum during the
year 2009-10.
During the year 2010-11, the company has recorded revenue income of
Rs.1088.52 million rising from Rs. 534.90 million, thus recording
103.50% growth. The profit before tax has increased from Rs. 367.00
million in 2009-10 to Rs. 514.31 million in year 2010-11 recording
increase by 40.14 %. The profit after tax recorded increase by 45.48%
from Rs. 254.52 million in 2009-10 to Rs. 370.27 million during the
year 2010-11.
The amount of debt sanction during the year, excluding those
convertible into long term loans, increased to Rs. 17030 million
compared to Rs. 12490 million in the previous year. The level of
disbursement of debt was Rs. 6236.64 million during the year and Rs.
2827.08 million in previous year. Effective commitments for sanctions
of debt as on 31st March, 2011 were Rs. 33649 million as compared to
Rs. 18332 million as on 31st March 2010.
Upfront financing of CER amounted to Rs. 222.38 million in the year
2010-11 as against Rs. 50 million in the year 2009-10.
The number of new projects for which financial assistance was
sanctioned during the year was 20 taking the total number of sanctioned
projects till 31st March, 2011 to 62. The financial assistance
sanctioned by PFS so far would help capacity creation of more than
14000 MW.
PTC Energy Limited (PEL)
PTC Energy Ltd. (PEL), incorporated in 2008, is a wholly owned
subsidiary of your Company, primarily to undertake various activities
related to the business of power generation, distribution, import of
coal and other allied works.
PEL has initiated steps to explore joint development of projects in the
energy sector. The core investment strategy of PEL is to jointly
develop projects with a view to invest as promoter and hold on to
investment rather than investing with intent to exit. PEL has
accordingly formulated an investment policy and is pursuing a number of
projects in the energy sector.
To bridge the gap in demand supply position for coal based power
projects and to overcome fuel supply disruptions, PEL has entered in to
this business avenue to play the role of fuel intermediation, thus
acquiring a position of strength for tying up imported long-term fuel
supply. To expedite fuel intermediation business with a view to meet up
the fuel deficiency faced by utilities/clients, PEL is actively engaged
in import of coal. Starting its fuel intermediation business operations
effectively from November 2009, PEL in its third year of operations
i.e. 2010-11, has imported and sold 2.80 lakhs MT of coal as against
1.07 lakhs MT in FY 2009-10 and has recorded coal revenue income of Rs.
92.78 crores rising from Rs. 26.85 crores in FY 2009-10.
The income of PEL has increased to Rs. 93.82 crores as compared to Rs.
27.84 crores in FY 2009-10 and Profit before Tax has increased to Rs.
1.86 crores from Rs. 0.73 crores in FY 2009-10.
PEL has undertaken a strategic investment of 48% equity amounting to
Rs. 23.40 crores for joint development of 80 MW wind farm in
Tamilnadu.
Annual Accounts of the subsidiary companies
The Audited Accounts for the financial year 2010-11 of PFS and PEL,
being subsidiaries of your Company, have been attached with the Annual
Accounts of your Company along with the statements as per the
provisions of Section 212 of the Act. A copy each of Balance Sheet,
profit and loss account, report of Board of Directors, report of
Auditors and statement of interest of your Company in PFS and PEL is
also enclosed.
Investment in other Companies
1. Your Company has earlier executed Equity Subscription Agreement
(ESA) for investment in Athena Energy Ventures Pvt. Ltd. (AEVPL). As
of now PTC has released Rs. 1500 Million and the other investors of
this Company are Athena Power Projects Limited and Infrastructure
Development Finance Company Limited (IDFC).
2. Your Company has earlier executed Equity Subscription Agreement
(ESA) for investment in Krishna Godavari Power Utilities Limited upto
Rs. 400 Million and as of now PTC has released Rs. 195.05 Million.
3. Teesta Urja Limited is developing 1200 MW Teesta-III Hydro Electric
Project in the State of Sikkim. Your Company has acquired 11%
subscribed equity in Teesta Urja Limited and has released Rs. 1414
Million.
Directors' Responsibility Statement
In pursuance of Section 217 (2AA) of the Companies Act 1956, the
Directors make the following responsibility statement that:
1. In the preparation of the Annual Accounts, the applicable Accounting
Standards have been followed by PTC along with proper explanation
relating to material departures;
2. The Directors had selected such Accounting Policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the Financial Year 2011 and of the profit
of the Company for that period;
3. Proper and sufficient care had been taken by the Directors for
maintenance of adequate Accounting records in accordance with the
provisions of the Companies Act 1956 for safeguarding the assets of the
Company and for preventing and detecting frauds and other
irregularities and
4. The Annual Accounts had been prepared on a going concern basis.
Acknowledgments
The Board of Directors acknowledge with deep appreciation the co-
operation received from the Government of India, particularly the
Ministry of Power and the Ministry of External Affairs, State
Electricity Utilities, State Governments, Regional Power Committees,
Central
Electricity Authority, Central Electricity Regulatory Commission and
State Electricity Regulatory Commissions, Power Sector Organizations
viz. Power Grid Corporation of India Ltd., NTPC Ltd., Power Finance
Corporation Ltd., NHPC Ltd. , Life Insurance Corporation of India and
valuable investors of the Company and look forward to their continued
support in future.
The Board wishes to place on record its appreciation for efforts and
contribution made by the employees at all levels. Our consistent growth
was made possible by their hard work, solidarity, co-operation and
support.
For and on behalf of the Board of Directors
(Tantra Narayan Thakur)
Chairman & Managing Director
Place: New Delhi DIN00024322
Date : 8th August, 2011
Mar 31, 2010
The Directors take great pleasure in presenting to you, the eleventh
Annual Report on the activities of your company, together with the
Audited Annual Accounts for the Financial Year 2009-10.
Performance and Financial Highlights
Your company has completed another innovative year of its operations,
wherein it has sustained and maintained its leadership position in the
industry. The trading volumes were 32% higher this year at 18236 MUs as
against 13825 MUs during the previous year. With a turnover of Rs.
78445 Million (including other income) as against Rs. 66261 Million
(including other income) in the financial year 2008-09, your Company
has earned a profit after tax of Rs.941 Million as against Rs. 908
Million in the previous year.
Your Company also have two subsidiaries, namely PTC India Financial
Services Limited and PTC Energy Limited (Wholly Owned). The
consolidated turnover of group is Rs. 79259.04 million for the current
financial year as against Rs. 66377.77 Million for the financial year
2008-09. The consolidated profit after tax of the group is Rs. 1072.69
million for the current financial year as against Rs. 940.88 million
for the financial year 2008-09.
The financial results of the company for the FY 2009-10 vis-a-vis
2008-09 under broad heads are summarized as under:
(in Rupees Million)
Particulars For the Year For the Year
ended 31.03.2010 ended 31.03.2009
Sales (including rebate on
purchase of 77,703.41 65,288.82
power, service charges and surcharge)
Other Income (including income 741.66 972.56
from consultancy services)
Purchase (including rebate on sale
of power) 76,750.60 64,735.97
Employee Cost 184.35 150.11
Other Expenses etc. 135.13 177.67
Profit before amortization, depreciation 1,374.99 1,197.63
and prior period items
Amortization and Depreciation 55.21 62.16
Prior Period Expenses/(Income) 1.85 1.05
Profit Before Tax 1,317.93 1,134.42
Provision for Taxation 376.92 226.10
(including deferred tax income)
Profit After Tax 941.01 908.32
Balance as per last accounts 691.98 479.50
Transferred to General Reserves 282.30 272.49
Dividend (incl. dividend tax) 412.17 412.88
Transfer to contingent reserves - 10.47
Balance carried forward to Balance Sheet 938.52 691.98
Earning Per Share in Rs. 3.31 3.99
Dividend
Your Directors are pleased to recommend for your consideration and
approval dividend @ 12% for the financial year 2009-10 i.e. Rs. 1.20
per equity share of Rs. 10 each. Total amount of dividend outgo for the
financial year shall be Rs. 412.17 million including corporate dividend
tax amounting to Rs. 58.71 million.
Reserves
Out of the profits of the Company, a sum of Rs. 282.30 Million has been
transferred to General Reserves during the year and total reserves and
surplus of the Company are Rs. 18016.90 Million (including share
premium) as on 31st March 2010.
Capital Structure
As on 31st March 2010, PTC has Authorized Share Capital of Rs.
750,00,00,000 and Paid-Up Capital of Rs. 2,94,54,74,010/- divided into
294,547,401 equity shares of Rs. 10 each. The equity shares of your
Company are listed on Bombay Stock Exchange Limited (BSE) and The
National Stock Exchange of India Ltd. (NSE). The promoters i.e. NTPC
Ltd. (NTPC) , Power Grid Corporation of India Ltd. (POWERGRID), Power
Finance Corporation Ltd. (PFC) and NHPC Ltd. (NHPC) individually hold
4.075% each, or 16.30% collectively of the paid-up equity and
subscribed share capital of your Company and the balance of 83.7% of
the equity paid-up and subscribed share capital of your Company is held
by Power Entities, Financial Institutions, Life Insurance Corporation
of India and other Insurance Companies, Banking Institutions,
Corporations, Investment Companies, Foreign Institutional Investors,
Private Utilities and others including general public at large. The
shareholding pattern of your Company as on 31.03.2010 is as follows:-
Category No. of shares Percentage of
held shareholding
A. Promoters holding
1. Promoters
- Indian Promoters 48,000,000 16.30
- Foreign Promoters - -
2. Persons acting in concert - -
Sub-Total 48,000,000 16.30
B. Non-Promoters Holding
1. Institutions
Mutual Funds and UTI 69,790,601 23.69
Banks and Financial
Institutions 28,655,973 9.73
Insurance Companies 48,931,102 16.61
FIIs 55,033,293 18.68
Sub-Total B(1) 202,410,969 68.72
2. Non Institutions
Bodies Corporate (incl.
DVC) 17,408,150 5.91
Individuals 21,788,662 7.40
(Holding nominal share
capital
upto Rs. One lac)
Individuals 3,003,797 1.02
(Holding nominal share
capital
in excess of Rs. One lac)
Others
- NRIs 1,753,877 0.60
- Trusts and Foundations 181,946 0.06
Sub-Total B (2) 44,136,432 14.98
Total Public Shareholding 246,547,401 83.70
GRAND TOTAL 294,547,401 100.00
Distribution of shareholding - As on 31.03.2010
Nominal value of each share is Rs. 10/-
Number Range No. of % To Total
of Shares Capital
Folios
116048 Upto 500 13133475 4.46
4407 501 1000 3656010 1.24
1799 1001 2000 2739815 0.93
508 2001 3000 1307394 0.44
242 3001 4000 858287 0.29
216 4001 5000 1028579 0.35
267 5001 10000 2016272 0.68
213 10001 50000 4659265 1.58
40 50001 100000 2751420 0.93
150 100001 Above 262396884 89.08
123890 Total 294547401 100.00
Net Worth and Earning Per Share (EPS)
As on 31st March 2010, net worth of your company aggregates to Rs.
20962.37 mn as compared to Rs. 15365.23 mn for the previous year
thereby registering a growth of 36.43%.
EPS of the Company as on 31.03.2010 stands at Rs. 3.31 in comparison to
Rs. 3.99 as on 31.03.2009.
Management discussion and analysis
The short term power market in India has witnessed further
consolidation during the year- it not only grew in absolute size in
volume terms but its share as percentage of total electricity
generation in the country also grew noticeably. Of the total
electricity generation in India during 2009, short term power market
including trading through power exchange, comprises about 5%. UI volume
is about 3% of total electricity generation and the balance 92% of the
generation is being procured mainly by distribution utilities through
long term contracts.
The short term market is showing rising trend and from 3.28% in 2008,
this has increased to a level of 4.08% during the year 2009. The volume
traded on power exchange was 1% of the total electricity generation.
In terms of volume (kWh), the short term electricity market size was
about 30.6 Billion kWh during the year 2009 - about 20.3 % higher
compared to 23.37 BU transacted during the year 2008-09. In monetary
terms, size of this short term market was about Rs. 20,000/- crores.
During the year 2009-10 actual volume transacted in short term could
have been 50-60% higher had there been no congestion prevailing in the
market.
As on 31.12.2008 there were 38 electricity trading licensees out of
which there are 15 licensees in category-I (unlimited trading). Top 5
trading licensee have more than 83% power market share. Out of which
PTC share alone is 43%. Gap between PTC and the second largest trader
(NVVN-13.25% share) is quite high.
PTCs cross border trade volume from Bhutan, which is almost 30 % of
its portfolio, may gradually fall particularly due to expected lower
average rainfall and also rising domestic demand in Bhutan. Domestic
load in Bhutan is growing whereas there is no likely capacity addition
in the foreseeable future. Since Bhutan gives priority to its domestic
consumption / economic growth over the export and there is rapid rise
in demand, it is expected that in the coming years there will be drop
in the surplus power export.
During the year there was significant jump in the domestic transaction
due to continued market efforts through portfolio management of some of
the States. In the long term segment although power has started to be
available to PTC from projects like Samal, Baglihar and Meenaxi, some
of the long term projects are under PPA disputes / litigation and there
could be some uncertainty in getting power from such projects.
CERC analyses volume of electricity transacted through trading
licensees using the HERFINDAHL - HIRSCHMAN INDEX (HHI) for measuring
the competition among trading licensee. HHI between 0.10 to 0.18
indicates moderate concentration and HHI above 0.18 indicates higher
concentration/ market power among trading licensee. PTC HHI is 0.18,
which shows moderate level of concentration / market power despite a
large market share.
In FY 2009-10 as compared to the previous year average prices have come
down for bilateral trade from Rs. 7.31/kWh to Rs. 5.26/kWh and for
power exchange from Rs. 7.49 /kWh to Rs. 4.99/kWh.
Average prices over the year are slightly higher in OTC market than on
Power Exchange. This is because OTC trades are firm contracts and there
is premium for reliability and predictability. For 7 months of the last
year PX average prices were higher than bilateral average prices
whereas for 5 months, bilateral average prices were higher.
Short-term prices are showing a downward trend- prices have come down
in both the platforms, bilateral and OTC. For procuring 5% of the short
term electricity utilities had to incur a cost of 6.83%. Utilities
sparingly use short term procurement option, mostly under distress
situation. The cost of procurement by utilities which was 8% during
2008-09 has come down to 6.83% during 2009-10. This market trend of
reduction in prices implies that competition is rising.
The short term prices are higher than the long term prices- and
justifiably so due to persistent shortages. It gives a right kind of
price signal for capacity addition. Nevertheless the regulators are
concerned of high prices and have taken steps to
intervene in the short term market. The Company on the other hand
continues to impress upon through regulatory and policy advocacy that
the outcomes so far are but interplay of market demand and supply and
the short term power market is expected to be a niche market with
minimal regulatory intervention.
The country has two operational power exchanges, namely Indian Energy
Exchange (IEX) and Power Exchange India Ltd (PXIL). IEX, co-promoted by
PTC through its subsidiary PFS during the FY 2008-09, has the major
share of trade on Power Exchanges. During the year 2009, for the first
time industrial sector consumers have begun procurement of power
through power exchange, mostly at the IEX.
CERC eased out the imposition of transaction margin cap during the
year. Inter- state trading licensees could now charge margin up to 7
paise per kWh for cost of energy higher than Rs. 3 per kWh. Trading
margin of 4 paise per kWh however continues as earlier for the cost of
power at Rs. 3 per kWh or below. Trader-to- trader transaction has also
been allowed albeit with above margin cap.
CERC brought out a comprehensive regulation on Power Market. Regulation
on Renewable Energy including Renewable Energy Certificate is another
initiative which would give a strong push to mainstream such sources of
energy and increase their share. Transmission pricing regulation based
on marginal participation method has also been issued - which is
expected to address the pan-caking issues in transmission thus more
suiting to the growth of power market. This will enable
remotely-located hydro -electric generation resources, particularly in
the north-eastern region, to be brought to the load centres through
long-distance transmission lines.
The Un-scheduled Interchange (UI) mechanism has also been revamped
recently. It is expected that UI will be used mainly for enforcing
grid discipline- thus removing earlier aberration of this mechanism
being used as a mode of trading of power.
Regulatory and policy initiatives such as development of power market
through adequate grid augmentation, facilitating non-discriminatory
open access to grid and ensuring grid discipline are slowly but
steadily showing its impact on the power market and its growth.
Such initiatives could go a long way in further accelerated development
of power market and to achieve the goal of about 15% of total
electricity to be traded in short term power market as per National
Electricity Policy.
The deepening of the power market has created renewed interest by the
private investors and a demonstrable commercial orientation among power
utilities. While investors and developers are enthusiastic about power
sector, the major challenge that remains is to convince the states to
vigorously pursue power sector reforms based on non-discriminatory open
access.
With the revised trading margin regulation 2009-10, the long term
contracts have been taken out from the purview of this regulation and
it is expected that transactions under long term contracts would be
covered in a competitive manner through negotiation between buyer and
seller based on perceptible risk and returns. Your company expects that
the average trading margin realized could be higher in the coming
years.
Your company is participating in Case-I Tariff Based Competitive
Bidding invited by various States, discoms, power utilities for
procurement of power on long term and medium term basis. In accordance
with National Tariff Policy, Electricity Utilities can procure power
through competitive bidding process and for this purpose Ministry of
Power has come out with Standard Bidding Document for Case-I Bidding.
Some States have also come out with Standard Bidding Document under
Case-I for procurement of power such as Gujarat, Punjab, Karnataka,
Maharashtra among others. PTC has been actively participating in such
competitive bidding and is competitively placed in various bids which
are to be finalized by the concerned power utilities.
There remain certain issues related to fuel, transmission, price
escalation viz-a-viz rail freight which is acting as a barrier for
expeditious finalization of such bids and has also resulted in lack of
level playing field between generation close to pit-heads or resources
vis-ÃÂ -vis the generation located within the State but away from
resource centres.
Your company is actively taking up related issues being faced by
developers/ IPPs with the Ministry of Power, Government of India and
appropriate regulatory commission to expedite the Case I Bidding which
would result in tying up of long term power that PTC has under its
portfolio by signing long term PPA with various IPPs / developers.
Short Term Trading
Your Company has completed another significant year of its operations,
one in which it has further consolidated its position in the industry
despite intense competition, downfall in cross-border traded volumes
and less than expected contribution from its long term supply sources.
This has been made possible through steep rise in domestic trade by
bringing innovative solutions and managing key portfolio of some states
so as to remain the front runner.
During the FY 2009-10, PTC total traded volumes touched 18236 MU, a 33%
increase as against 13825 MUs during the previous year 2008-09. Your
Company extended its existing agreements with Chhattisgarh, CPPs/IPPs
for sale of their surplus power for period ranging between 1- 3 years.
Negotiations are in advance stage with some other surplus
States/Utilities for signing agreements on similar lines.
Initiatives such as Intra- State power trading in Tamil Nadu and
enhancing trade from captive sources have also contributed to increase
trade volumes. The Company also carried out a number of energy banking
transactions during the year.
PTC volume on power exchange during 2009-10 reached 1830 MU against the
previous year figure of 1317 MU -registering a growth of 33% over the
previous year. Share of PTC traded volume on Power Exchange is about
10% of its portfolio. Long term power from projects have started
contributing to trading volumes and the total MU traded from projects
under long term PPA was 1535 MU.
Power Exchange Operation
CERC has permitted the trading of Power/Electricity through Power
exchange with effect from June 2008. Currently, two power exchanges are
operational in India, namely Indian Energy Exchange (IEX) and Power
Exchange of India Limited (PXIL). Both these power exchanges
facilitate an automated on-line platform for trading of power on day
ahead basis via Day Ahead Market (DAM) as well as term ahead basis via
Term Ahead Market (TAM). PTC is among the leading members of both the
exchanges and has the biggest portfolio of State Utilities trading
power on the exchanges via traders. Apart from the state utilities,
PTCs list of clients range from various high power consumption
industries to captive power plants in the states.
PTC provides its clients with a unique service of daily Power Status
Report which includes information on price & volume of the power
traded, weather forecast and system related information enabling the
clients to schedule/ plan his daily power requirements as also assist
in predicting their power supply/demand in future on the basis of
comprehensive details.
Power trade with Bhutan
Your company continues to import power from 3 hydroelectric projects in
Bhutan under long term bilateral arrangement.
Surplus power from 336 MW (4Ã84 MW) Chhukha project is being supplied
to the Eastern Region constituents namely Bihar, DVC, Orissa,
Jharkhand, Sikkim and West Bengal.
Surplus power from 60 MW (4Ã15 MW) Kurichhu project is being supplied
to Eastern Region constituents namely West Bengal and DVC.
Surplus power from 1020 MW ( 6Ã170 MW) Tala project is being supplied
to Bihar, DVC, Orissa, Jharkhand and West Bengal in the Eastern Region
and to Delhi, Haryana, J&K, Punjab, Rajasthan and Uttar Pradesh in the
Northern Region.
During the year 2009-10, the total power imported from Bhutan was 5336
MU. During the high hydro months in the current year, there was more
than 10% drop in the import of energy from Bhutan as compared to
previous year. This was owing to less availability of water and
increase in power demand in Bhutan.
Power Trade with Nepal
The bilateral exchange of power between the two countries is carried
out under two categories: (a) arrangement under Indo-Nepal Power
Exchange Committee and (b) commercial power transactions
Under commercial arrangement, your Company exports power to Nepal to
meet their urgent requirement. Generally power on commercial principles
is supplied to Nepal Electricity Authority (NEA) during winter months
when their own hydro generation drops significantly. Your Company
arranged 22 MW RTC power from 1st January 2010 till 30th April 2010 and
about 69 MU were exported to Nepal.
Your Company is also exploring possibilities of entering into long term
PPAs with the prospective IPPs in Nepal for import of power through new
transmission corridor being proposed between India and Nepal.
Long Term Agreements for Purchase of power
While your company plans to build on its success in short term, it sees
more sustainable growth in long term business and is accordingly
organizing its efforts towards entering into medium and long term
arrangements.
(A) Commissioned Projects
i. Power Projects commissioned before FY 2009 - 10
Baglihar HEP (450 MW) and Middle & Lower Kolab HEP (37 MW) were
commissioned before FY 2009-10. PTC has a contracted capacity of 225 MW
from 450 MW Baglihar HEP and the balance power is being consumed within
the state of J&K. Out of 225 MW capacity, PTC has entered into long
term Agreements for 150 MW and the balance 75 MW is being sold by PTC
through short term contracts. Energy from Middle & Lower Kolab
aggregating to 37 MW is being supplied to GRIDCO through long term
Agreements.
ii. Power Projects commissioned in FY 2009 - 10
- Samal HEP in Orissa (20 MW)
The project has been commissioned in October, 2009. Entire capacity
from the project has been tied-up with State of Orissa through long
term Agreement
- Pathadi Thermal Power Plant (Phase-I, 300 MW)
The Project developed by Lanco Group has been commissioned in June,
2009. PTC is trading the power from the project in the short term
market.
- SUGEN Gas Based Power Project in Gujarat (1100 MW)
The project developed by Torrent Group has been commissioned in August,
2010. PTC has signed PSA with the MPPTC, for sale of 100 MW plant
capacity from the project. There were certain issues relating to fuel
tariff which have now been amicably resolved but the power flow is yet
to commence due to certain issues relating to open access which are
being resolved shortly in the regional commercial committee meetings.
iii. Power Projects which are expected to commissioned in FY 2010 - 11
- Pathadi Thermal Power Plant (Phase-II, 300 MW)
The Project is under synchronization and power flow is expected to
commence after the stabilization of the plant. PTC has signed Power
Sale Agreement with Haryana. Bulk Power Transmission Agreement has also
been signed with POWERGRID for evacuation of power from the project to
Haryana periphery.
- Malana - II in Himachal Pradesh (100 MW)
The project developed by M/s. Everest Power Pvt. Ltd. is under advanced
stage of construction and is expected to be commissioned by December,
2010. PTC has signed PPA for purchase of entire plant capacity with
the developer and has also signed PSA for sale of entire capacity with
State of Punjab.
- Biomass based power projects in Tamil Nadu (18 + 18 MW)
The projects are being developed by M/s. Auro Mira Biopower India Pvt
Ltd. and M/s. Auro Mira Bio Systems Kanyakumari Pvt. Ltd. Both the
projects are in advanced stage of construction and are expected to be
commissioned in year 2010-11. Power from these projects would be sold
through short term contracts.
- Budhil HEP in Himachal Pradesh (70 MW)
The project is developed by M/s. Lanco Green Power Pvt. Ltd. and is
expected to be commissioned by March, 2011. PTC has tied up sale of
entire plant capacity with Punjab.
B. Power Purchase Agreements finalized in 2009-10
During the year, PTC entered into Power Purchase Agreements with
cumulative capacity of approximately 5700 MW. Power from most of the
projects is being offered for sale through Case - 1 bidding process
being initiated by State Utilities and Private Discoms. Cumulative PPAs
at the end of the year is around 16,000 MW. The projects are based on
domestic coal, imported coal, gas and hydro resources.
C. Memorandum of Understanding / Agreement
In addition to the above Projects, PTC has also signed MoUs/MoAs with
number of Project developers for purchase of power aggregating to
approximately 6000 MW. Cumulative MoUs/MoAs at the end of the year by
PTC is around 15,000 MW based on domestic coal, imported coal, gas and
hydro resources.
D. Progress on Projects for which Agreements had been entered before
FY 2009-10
Some of the main projects are:
- Teesta StageÃIII HEP in Sikkim (1200 MW)
The Project has achieved financial closure and is under construction
and is expected to be commissioned in the FY 2011-12. Punjab, Haryana,
Uttar Pradesh and Rajasthan are the beneficiaries from the project with
which PTC has entered into long term Power Sale Agreements. PTC will
sell part capacity from the Project on short term basis.
- GMR Energy Limited in Orissa (1050 MW)
The Project is in advance stage of construction and is expected to be
commissioned in the year 2011-12. PTC has tied-up sale of 300 MW net
capacity from the project with Haryana discoms through Case-1
competitive bid process invited by the State of Haryana.
- Monnet Power Company Limited in Orissa (1050 MW)
The Project is in advance stage of construction and is expected to be
commissioned in the year 2012-13. PTC has participated with competitive
tariff in Case - I tenders for purchase of power on long term basis by
the States of Bihar and Karnataka with 150 MW capacity each but,
outcome of the bidding process is not known yet
- Simhapuri tolling project in Andhra Pradesh (200 MW)
The project is under advanced stage of construction and it is expected
to be commissioned in the year 2011-12. The project has been set up as
concept of tolling, PTC has signed Power Tolling Agreement wherein the
power plant would generate power using imported coal supplied by PTC
Group and supply power to PTC. The project is being developed by M/s.
Simhapuri Energy Pvt. Ltd.
- Meenakshi Energy tolling Project in Andhra Pradesh (160 MW)
The Project is in advance stage of construction and it is expected to
be commissioned in the year 2011-12. This is Power Tolling Agreement
with tolling concept wherein the power plant would generate power using
imported coal supplied by PTC Group and supply power to PTC. The
project is being developed by M/s. Meenakshi Group.
E. Other Projects under consideration by PTC
PTC has received proposals for long term sale of power from various
project developers aggregating to a capacity of about 5000 MW. PTC is
actively evaluating these projects and is in discussion with developers
for signing of MoUs/MoAs, based on marketability of power from these
Projects.
II) Sale of Power
As per the Tariff Policy of Government of India, the long term power
procurement by the SEBs/ DISCOMs has to be necessarily done through
competitive bidding from 30th Sept, 2006 onwards. As such, sale of
power by the Company to the State Utilities has to be through
participation in the bidding process. The Company has participated in
competitive bids invited by State Utilities of like Maharashtra,
Rajasthan, Karnataka, Bihar, and Gujarat and has qualified for about
2580 MW capacity.
During the year, the Company has signed Power Sale Agreement (PSA) with
GRIDCO, Haryana and Punjab for 170 MW capacity, thereby enhancing the
cumulative PSA to about 3500 MW capacity.
Advisory Services
The Advisory Services at PTC continued its successful journey
supporting its valued customers on setting up effective internal /
external business processes and share its experience in dealing with
emerging issues in the development of Power Market
The gamut of services offered by the group includes tariff and
financial modeling for IPPs, preparation of pre-feasibility reports /
DPRs for projects, preparation of RFP & RFQ for competitive bidding of
power projects, market study reports amongst others.
The clientele ranges from the regulators, the state electricity boards
to the private sector players keen to capitalize on the booming power
sector in the country. Some important clients amongst others that
availed advisory services this year are Government of Goa, Singareni
Collieries Company Limited, Aryan Coal Benefication Ltd., amongst
others.
Business and Knowledge Partnerships
Your company continues to manage successfully its business and
knowledge partnership with industry associations such as CII, FICCI,
ASSOCHAM, PHDCC and also organizations like TERI, CBIP, CEA, SWECO
GRONER/ NORDPOOL, World Energy Council, USAID/ SARIE among others.
During the year 2009-10, Phase II of Indo Norwegian Program of
Institutional Cooperation (INPIC) was successfully concluded. Both
sides are now under active discussion to agree for technical
collaboration in PhaseÃIII.
Your company has embarked upon energy efficiency business by signing
MOU with Bureau of Energy Efficiency (BEE) and during the year has made
significant progress towards implementing some of the energy efficiency
projects.
Human Resource
Employees are central as well as critical to your Company as they are
our only assets. We have created an enabling work environment that
encourages originality and innovative thinking. Your Companys brand
value, growth and expansion into new areas have enabled us to attract
and retain high caliber employees while engaging and nurturing them to
achieve leadership in our area of operations.
Your Company has constantly developed and introduced policies and
procedures that nurture the potential and talent of all our employees
to optimize the benefits from this significant investment. Performance
Management System, performance linked incentives, resource planning,
training and development, career progression etc. are some of the
policies and procedures that have matured over time.
Your Companys key focus has been to bring in fresh minds and leverage
their talent and potential to meet the corporate objectives of the
company. This is possible through identifying the best talent in
campuses and grooming them. Every year we have gone to the best
campuses and have inducted talent across various verticals of your
Company.
Employee Stock Option Scheme 2008
Shareholder approval of the scheme was obtained at the Annual General
Meeting held on 6th August, 2008 for introduction of Employee Stock
Option Scheme at PTC India Ltd.
Under Employee Stock Option Scheme 2008, a second tranche of 0.75% of
the Issued Share Capital base as on March 31, 2008 has been allotted as
options to the employees. Disclosures as stipulated under the SEBI
Guidelines have been made.
The details of schemes and relevant disclosures of ESoP are made in the
Annexure to this report.
Conservation of Energy & Technology Absorption
As your Company is engaged in the activity of trading of power and
other related activities, the particulars relating to conservation of
energy and technology absorption respectively are not applicable to it.
The company had successfully ventured into the field of wind power
generation in March, 2008. The 4 Ã 1.5 MW wind farm project of PTC is
located at Sinnar, Nashik in Maharashtra. The PPA for the project has
been executed with the state distribution utility (MSEDCL) for Rs. 3.50
/ kWh with an escalation of 15 paisa / kWh per annum for 13 years. The
project generated about 13.38 MUs of energy worth Rs. 4.88 Crores in
FY2009-10.
Foreign exchange earnings & outgo etc.
The Company has incurred an expenditure of Rs. 17.48 Million (on
accrual basis) in foreign exchange during the financial year 2009-2010.
No foreign exchange was earned during the financial year.
Particulars of the employees u/s 217 (2A)
During the Financial Year ending 2010, no employee was employed for
full or part of the year, who was in receipt of remuneration, which in
aggregate or as the case may be, at a rate which, in the aggregate was
not less than Rs 24 lacs per annum or Rs 2 lakh per month except the
following employees the details of whom are given below:-
Name Sh. Sanjeev Mehra Sh. Deepak Amitabh
Designation EVP Director
Qualification B. Tech. M Sc.
Nature of EVP Director
Employment
whether contractual
or otherwise
Nature of Duties New Business Head of Finance,
of Employees Development Commercial &
Support Services
Last employment held Powergrid Corporation Government of India,
of India Limited Ministry of Finance
Number of years of 28 26
experience
Age 51 50
Date of commencement 01.10.1999 03.09.2003
of employment
Gross Remuneration 2.93 4.10
(figures in Rs.
Million)
No. of Equity Shares 45,055 40,300
held (of Rs. 10/-
each)
Whether Relative
of a No. No
Director or Manager
Other terms and No. No
conditions of
Employment
Name Sh. Shashi Shekhar Sh. T. N. Thakur
Designation Director Chairman &
Managing Director
Qualification IAS B.Sc. ( Engineering)
Nature of Employment Director CMD
whether contractual
of otherwise
Nature of Duties Head of Marketing Overall Managerial
& Corporate functions
of Employment Development of company
Last employment held Government of Power Finance
Tamilnadu and Corporation Ltd.
Government of India
Number of years of 29 39
experience
Age 54 61
Date of commencement 29.06.2007 11.10.2000
of employment
Gross Remuneration 4.41 8.39
No. of Equity Shares 0 1,94,490
held
Whether Relative of a No No
Director or Manager
Other terms and No No
conditions of Employment
Employee for part of the year
Name Shri Arun Bhalla
Designation ED
Qualification ME
Nature of Employment whether
contractual or otherwise ED
Nature of Duties of Employees Commercial and
Operations
Last employment held Maharastra Power
Transmission
Structures Pvt Limited
Number of years of experience 34
Age 59
Date of commencement of employment
and date of resignation 05.01.2006 to 16.02.2010
Gross Remuneration (figures in Rs. Million) 2.57
No. of Equity Shares held (of Rs. 10/- each) N.A.
Whether Relative of a Director or Manager
Other terms and conditions of Employment No
Auditors
- Statutory Auditors
M/s. T.R. Chadha & Company, Chartered Accountants were appointed as
Statutory Auditors of the Company for the Financial Year 2009-2010 by
the Shareholders in the tenth Annual General Meeting of the Company and
shall hold office upto the conclusion of the forthcoming Annual General
Meeting of the Company and have given their consent for re-appointment.
The Statutory Auditors have audited the Accounts of the Company for the
Year ended 31 March 2010 and Audited Accounts together with the
Auditors Report thereon are annexed to this report. There are no
qualifying remarks from Statutory Auditors on the Accounts of the
Company.
The shareholders will be required to elect auditors for the current
year and fix their remuneration. The Company has received a written
confirmation from M/s. T.R. Chadha & Company to the effect that their
appointment, if made, would be in conformity with the limits prescribed
in section 224(1B) of the Companies Act, 1956.
The Board recommends the appointment of M/s. T.R. Chadha & Company as
the Statutory Auditors of the company for the Financial Year 2010-2011
by the Shareholders in the eleventh Annual General Meeting of the
Company.
- Internal Auditors
M/s. Ravirajan & Co. Chartered Accountants, Delhi were appointed as
Internal Auditors of the Company for the Financial Year 2009-2010 and
their reports for the year were submitted to the Audit Committee.
- Cost Auditors
The cost auditors of the Company for the 4 Ã 1.5 MW wind farm project
of PTC located at Sinnar, Nashik in Maharashtra are M/s. Ramnath Iyer &
Company.
Subsidiary Companies
PTC India Financial Services Ltd. (PFS)
PTC India Financial Services Ltd. (PFS) wherein the Company holds
77.60% stake is one of the subsidiaries of PTC India Ltd.
Starting its business operations effectively from the September 2007,
PFS in its third year of operation i.e. 2009-10, has recorded revenue
income of Rs. 53.49 crore rising from Rs. 11.60 crore in 2008-09,
despite the challenges faced in the economy recovering from the global
financial meltdown.
The Profit Before Tax (PBT) has increased to Rs 36.70 crore, from Rs.
8.68 crore in the year 2008-09. This was largely due to increased level
of disbursement of the loans to power projects - both term loan and
mezzanine/short term loan, and increase in the fee-based income.
The amount of gross sanction of loan and equity made during the year in
aggregate was Rs. 1727.34 crore compared to Rs. 721.46 crore in the
previous year. The level of disbursement during the year was Rs. 181.59
Crores as equity and Rs. 287.20 Crores as debt compared to Rs. 168.79
crore and Rs. 20 crore respectively in the previous year.
On the resource mobilization, PFS, for the first time, accessed bond
market in its endeavor to increase resource base. External Commercial
Borrowing of USD 30 million has been recently sanctioned by a
multi-lateral agency.
PTC Energy Limited (PEL)
PTC Energy Limited (PEL), a subsidiary of your company was formed in
August 2008 with an objective to develop asset based business.
PEL, keeping in view the emerging opportunities in the power sector and
large portfolio of power projects with required clearances and linkages
had laid down an ambitious plan to enter into the business of
generation, distribution, transmission and deal in electricity and all
form of energy including sale and purchase of energy, coal/fuels,
conversion of coal/ fuels into electricity ie tolling, fuel linkages
and provide advisory services in energy sector including energy
efficiency.
The business of Power Tolling Arrangements to provide developers with
fuel linkages in return for ownership of a share of power produced and
also undertake fuel intermediation to meet up the deficiency of fuel
resources either through alternate fuel arrangements or import of coal,
have been transferred from PTC to PEL.
During the year, PEL has also provided consultancy to clientele across
different phases of the energy sector value chain.
Annual Accounts of the subsidiary companies
The Audited Accounts for the financial year 2009-10 of PFS and PEL,
being subsidiaries of your Company, have been attached with the Annual
Accounts of your Company along with the statements as per the
provisions of Section 212 of the Act. A copy of Balance Sheet, profit
and loss account, report of Board of Directors, report of Auditors and
statement of interest of your Company in PFS and PEL is also enclosed.
Investment in other Companies
1. Your Company has earlier executed Equity Subscription Agreement
(ESA) for investment in Athena Energy Ventures Pvt. Ltd. (AEVPL). As of
now PTC has released Rs. 990 Million and the other investors of this
Company are Athena Power Projects Limited and IDFC.
2. Your Company has earlier executed Equity Subscription Agreement
(ESA) for investment in Krishna Godavari Power Utilities Limited upto
Rs. 400 Million and as of now PTC has released Rs. 195.05 Million.
3. Teesta Urja Limited is developing 1200 MW Teesta-III Hydro Electric
Project in the State of Sikkim. Your Company has acquired 11%
subscribed equity in Teesta Urja Limited and has released Rs. 1254
Million.
4. Your Company has also formed a Joint Venture Company i.e. Barak
Power Private Limited (BPPL) with BHEL for development of MW 125X2
project in the State of Assam. As of now, PTC and BHEL each has
released Rs. 0.5 Million in BPPL.
Directors Responsibility Statement
In pursuance of Section 217 (2AA) of the Companies Act 1956, the
Directors make the following responsibility statement that:
1. In the preparation of the Annual Accounts, the applicable
Accounting Standards have been followed by PTC along with proper
explanation relating to material departures;
2. The Directors had selected such Accounting Policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the Financial Year 2010 and of the profit
of the Company for that period;
3. Proper and sufficient care had been taken by the Directors for
maintenance of adequate Accounting records in accordance with the
provisions of the Companies Act 1956 for safeguarding the assets of the
Company and for preventing and detecting frauds and other
irregularities and
4. The Annual Accounts had been prepared on a going concern basis.
Acknowledgment
The Board of Directors acknowledge with deep appreciation the
co-operation received from the Government of India, particularly the
Ministry of Power, Ministry of External Affairs, State Electricity
Utilities, State Governments, Regional Power Committees, Central
Electricity Authority, Central Electricity Regulatory Commission and
State Electricity Regulatory Commissions, Power Sector Organizations
viz. Power Grid Corporation of India Ltd., NTPC Ltd., Power Finance
Corporation Ltd., NHPC Ltd., Life Insurance Corporation of India and
valuable investors of the Company.
The Board wishes to place on record its appreciation for efforts and
contribution made by the employees at all levels which made possible
the significant achievements by your Company.
For and on behalf of the Board of Directors
Sd/-
(Tantra Narayan Thakur)
Chairman & Managing Director
DIN00024322
Place : New Delhi
Date : 12 th August, 2010
Mar 31, 2003
I have great pleasure in presenting to you, on behalf of the Board of
Directors, the fourth Annual Report on the activities of the Power
Trading Corporation of India Ltd., together with the Audited Accounts
for the Financial Year 2002-2003.
Performance Highlights
The performance of your Company has indeed been excellent during the
Financial Year 2002-03 as it traded 4178 MUs as against 1617 MUs during
the previous year and achieved a turnover of Rs. 927 Crores (including
other income) as against Rs. 366 Crore (including other income) in
2001-02 in spite of some major constraints affecting our transactions.
The Company spearheaded implementation of innovative concepts in
trading of surplus power, like time of day trading for specific hours
of the day with differential pricing , infirm (as and when available)
power, short term trading for periods as low as three days etc. The
recently introduced Time of Day trading concept has given a major
impetus to PTCs vision for the power market, widening the spectrum of
market participants,
with trading transactions covering the length and breadth of the
country. Your Company has already made its presence felt in all the
five Electricity Regions of the country and is also successfully
managing sale of power from Bhutan.
Though the present trading transactions last from three days to three
years, we hope to handle, in the foreseeable future, day-ahead
transactions as also pursuing the segment of long- term contracts for
trading in power. With encouraging response from State Utilities and
private developers, the Company expects its business to increase
substantially in the coming years.
Trading volumes for FY 2001- 02 and for FY 2002-03, and the projected
figures in the Business Plan of the Company for the ensuing three years
are as indicated below:
Parameters 2001-02 2002-03 2003-04 2004-05 2005-06
(actual) (actual) (projected) (projected) (projected)
Trading 1617 4178 5647* 6152 8786
Volumes
(in MUs)
*PTC hopes to better the growth target and has set its sights on
achieving 6150 MUs in 2003-04.
Financial Performance
Your Company earned a profit after tax of Rs. 9.84 Crores for the FY
2002-03 compared to Rs. 7.35 Crores in the previous year. It has paid
an interim dividend @ 7% to the shareholders. The interim dividend is
proposed to be treated as the final dividend. An amount of Rs. 7.61
Crores have been transferred to Reserves and Surplus this year, thus
totaling the Reserve and Surplus to Rs. 13.31 Crores.
The financial results of the Company for the FY 2002-03 vis-a-vis
2001-02 are summarized as under:
Particulars For the Year For the Year
ended ended
31.03.2003 31.03.2002
(Rs. in Crores) (Rs. in Crores)
Electricity Sales 903.71 357.11
Other Income 3.27 2.46
Electricity Purchase 882.46 349.02
Employee Cost 1.51 0.99
Other Expenses 1.75 0.76
Profit before amortization,
depreciation and prior
period items (A-B) 20.67 8.02
Amortization and Depreciation 1.12 0.36
Prior Period Expenses 0.02 -
Profit Before Tax 19.53 7.66
Provision for Taxation
(including deferred tax
expenditure) 9.69 0.31
Net Profit After Tax 9.84 7.35
Dividend 2.23 1.48
Balance carried forward to
Balance Sheet 7.61 5.70
Earning Per Share in Rs. 3.90 3.47
(Annualised)
Capital Structure
The Capital base of PTC has undergone significant restructuring.
The authorized share capital of PTC has been raised to Rs. 750 crores
from the original Rs. 150 Crores. The four Central Public Sector Power
Companies i.e. National Thermal Power Corporation Ltd. (NTPC), Power
Grid Corporation of India Ltd. (POWERGRID), Power Finance Corporation
Ltd. (PFC) and National Hydroelectric Power Corporation Ltd. (NHPC)
would
contribute 8% each upto the authorized capital of Rs. 750 crores,
thereby bringing the aggregate to 32%. The balance 68% may be raised
from State Governments, State Electricity Boards, Power Utilities,
Generating/ Transmission/ Distribution Companies, Financial
Institutions, Unit Trust of India, Life Insurance Corporation of India,
Insurance Companies, Banking Institutions, Corporations, Investment
Companies, Independent Power Producers (IPPs), Private Utilities and
others including Public at large.
Equity Subscription Agreements have been signed with Damodar Valley
Corporation (DVC) and Tata Power Company (TPC). These Companies have
subscribed an amount of Rs. 10 Crore each towards equity of PTC. A
joint Equity Subscription Agreement had also been signed with five
Financial Institutions [Industrial Development Bank of India (IDBI),
Infrastructure Development Finance Company Ltd. (IDFC), Life Insurance
Corporation of India (LIC), General Insurance Corporation of India
(GIC) and IFCI Ltd] and PTC for an aggregate investment of Rs. 18.5
Crore in the equity of PTC.
Growth in Net worth
As on 31.3.2003, the paid-up capital of the Company was Rs. 72.50
Crores which has subsequently been raised to Rs. 74.50 Crores. It shall
be progressively
enhanced from time to time to meet the growing business requirement, of
the company. Based on the growing trading projections for next year, it
is proposed to raise the capital further.
Trading of Power
Your Companys trading volumes, which touched a figure of 4178 MUs of
energy during the year 2002-03, has been spread over a large number of
customers. PTC purchased power from many state utilities like WBPDCL
(1153 MUs), GOA (612 MUs), PSEB (48 MUs), MALANA (275 MUs), APTRANSCO
(101 MUs), CSEB (17 MUs), UPCL (951 MUs), DTL (380 MUs), DVC (177 MUs),
CHUKHA (333 MUs), KURICHHU (74 MUs). The list of utilities to which PTC
sold power had also increased during the financial year. The list
includes DTL (1326 MUs), HVPNL (546 MUs), KPTCL (173 MUs), GEB (306
MUs), RRVPNL (67 MUs), MPSEB (512 MUs), MSEB (576 MUs), KSEB (34 MUs).
Growth in trading volumes (MUs)
Trading Highlights for the year
- 200 MW From West Bengal to Delhi & Haryana
- 250 MW From West Bengal to Maharashtra
- 400 MW From West Bengal to Madhya Pradesh
- 200 MW From DVC to Kerala & Karnataka
- 50 MW From DVC to Maharashtra
- 200 MW From Uttaranchal to Delhi
- 50 MW From Uttaranchal to Haryana, Rajasthan, Punjab
- 50 MW From Uttaranchal to Maharashtra, Madhya Pradesh
- 85 MW From Goa to Maharashtra , Madhya Pradesh & Gujarat
- 50 MW From Punjab to Rajasthan, Madhya Pradesh
- 300 MW From Delhi to Maharashtra
- 200 MW From Delhi to Madhya Pradesh
- 70 MW From Himachal to Haryana (Private Hydro Power)
As mentioned earlier, the agreements for the purchase and sale of power
are for varying periods from three days to three years. It is expected
that PTC may be able to extend the trading of power against most of the
existing agreements. PTC has also affected trading at very short
notice, as in the case sale of power to Pondichery, sourced from UPCL,
and also for Delhi power to Haryana, Goa power to Chandigarh & Punjab,
thus providing timely and emergent service to its customers. PTC
presently has two major products for surplus power, namely Round The
Clock power and Time of Day power for specific hours each day. PTC has
adopted five broad price bands for power viz for evening peak hours,
morning peak hours, Round The Clock, day off-peak and night off-peak
periods. PTC is also trying to increase its customer base by tapping
new opportunities in the market, like trading of unrequisitioned power
and spot power. Your Company also plans to create the
necessary infrastructure for enabling online trading in the foreseeable
future.
UI trading between WR and SR
After implementation of Availability Based Tariff (ABT) in the Western
Region in July 2002, unscheduled inter- regional transactions with the
Southern Region were stopped due to non availability of compatible
commercial mechanism between the two Regions. PTC facilitated this
Unscheduled Inter-change (UI) of power between the Western Region,
which was under ABT regime, and the Southern Region which was then not
in ABT regime. This resulted in a win-win situation for both the
regions as SR constituents received cheaper power and WRs bottled up
power was utilized.
Power Exchange with Bhutan
The Ministry of Power, Government of India, entrusted the assignment of
purchase and sale of surplus power from 336 MW Chukha Hydroelectric
Project (CHPC) and 60 MW Kuricchu Hydroelectric Project (KHPC), both
located in Bhutan, to your Company. PTC and the Department of Energy,
Royal Government of Bhutan, signed agreements to this effect at Thimphu
on 31st August 2002. The term of the agreement for purchase of power
from CHPC is upto 31.03.2017 and for purchase of power from KHPC is
upto 31.03.2027, with provision for further extension as the parties
may mutually agree.
The two sides have maintained excellent cooperation and understanding
since the trading function of Chukha and Kurichhu power was taken over
by PTC. Initiatives taken by PTC for prompt deposit of payments to the
account of CHPC and KHPC for purchase of power has been well
appreciated by the Bhutanese authorities.
Surplus power from Chukha project is being supplied to the Eastern
Region constituents namely WBSEB, DVC, Sikkim, GRIDCO, BSEB and JSEB.
PTC traded 337.6 MUs of energy from CHPC during the period 1st October
2002 to 31st March 2003.
Surplus power from Kurichhu project is being shared by WBSEB and DVC on
50:50 basis. PTC traded 81.3 MUs of energy from KHPC during the period
1st October 2002 to 31st March 2003.
The assignment, earlier dealt by POWERGRID, was taken over by PTC with
effect from 1st October 2002. The agreements signed by PTC with the
Eastern Region constituents provide for payment security mechanism by
way of opening of LC.
Indo-Nepal Power Exchange
PTC, designated by the Government of India in July 2001 as the nodal
agency for Indo-Nepal power exchange, has been interacting with the
Nepal Electricity Authority (NEA) and the concerned agencies in India
for import of surplus power from Nepal and on the
issue of formulation of tariff based on commercial principles for
exchange of power between the two countries.
During a high level meeting held in Kathmandu in September 2001, NEA
had informed that with the commissioning of Kaligandki H.E. Project
(144 MW), they would be surplus in power by 100-150 MW during the
months of May to October from year 2002 to year 2017. Since the present
interconnections are not adequate to support the level of exchange of
100-150 MW power, PTC entered into an agreement with POWERGRID for
payment guarantees for construction of the Indian portion of a 132kV
Double Circuit line between Anandnagar in Uttar Pradesh and Butwal in
Nepal to enhance the quantum of Indo-Nepal Power Exchange. The
agreement which commits PTC to pay future usage charges for the
transmission line to be constructed, operated & maintained by POWERGRID
was signed on 4th December 2002 at New Delhi and is the first of its
kind in the country entered into between a Trading Company and the
Central Transmission Utility.
During the 7th Power Exchange Committee meeting between India and
Nepal, held in March 2003 at New Delhi, it was agreed that PTC shall
act as a nodal agency for prospective bilateral exchange of power at
the border between the three utilities (Bihar, Uttar Pradesh and
Uttaranchal) from the Indian
side and NEA with effect from 1. 6. 2003. However, the role of PTC in
this connection would be limited to the extent of billing and revenue
collection only. PTC shall be the sole agency from the Indian side for
finalizing all commercial and technical arrangements/systems with NEA
and for co-ordination with associated Indian agencies. Sale of power
would be dealt with by PTC and NEA directly on commercial basis based
on the market conditions.
Facilitation of projects
Your Company is giving a renewed thrust towards facilitation of private
power projects by taking steps to enter into long- term power purchase
agreements with them. Besides giving an impetus to the power
development programme in the country, this will also add significantly
to the strength of your Company as a major player in the Indian Power
Sector in the years to come. A brief overview of some projects that are
under active consideration by your Company is given below.
Maithon Right Bank Thermal Power Project (1000 MW) Ã Jharkhand
Maithon Right Bank Thermal Power Project is being implemented as a
Joint Venture between Damodar Valley Corporation and BSES Ltd in
Dhanbad district of Jharkhand.
The project will have a gross generation of 7400 MUs per year and has
been identified as a Mega Power Project by the Govt. of India. The
developer is in the process of obtaining various required statutory
clearances and the project is targeted to be commissioned by 2008.
The developers have submitted a tariff offer. PTC has initiated the
process of locating offtakers and has evinced interest from several
prospective beneficiaries for purchase of power from the project. In
order to take things forward in a smooth and structured manner, an MOU
was signed with the developers in December 2002. Discussions on the
Power Purchase Agreement are in process.
West Seti Hydro Electric Power Project (750 MW) Ã Nepal
The West Seti Hydro Electric project is being developed by M/s Snowy
Mountain Engineering Corporation (SMEC), an international developer, in
Nepal. The project will generate 3335 MUs of energy in a 50% dependable
year. The main attraction of the project is its large reservoir which
can hold water for one month generation at full capacity that makes the
project capable of producing peaking power for 8 hours a day round the
year.
The developers have submitted a techno commercial proposal to PTC in
the form of a tariff based offer. An MOU was signed with the developers
in September, 2002. Discussions on the PPA and tariff are on with the
developer. PTC is also in the process of finalizing the
offtakers of power from the project. The project is expected to be
commissioned in mid 2009.
Vemagiri Gas Based CCPP, Phase à II (370 MW) à Andhra Pradesh
The Vemagiri Combined Cycle Power plant is being developed by the GMR
group in the East Godavari district of Andhra Pradesh. The Govt. of
Andhra Pradesh initially permitted the company to establish, operate
and maintain a 520 MW project to be implemented in two stages of 370 MW
and 150 MW respectively. The sale of power from the 370 MW Phase à I of
the project has been tied up with APTRANSCO.
The developer now proposes to expand the permitted capacity of the
Phase à II from 150 MW to 370 MW and sell this power through PTC. The
developer has also submitted an indicative tariff proposal to PTC based
on which an MOU was signed with the developer in March 2003. The
offtakers of power from this project are likely to be the States in the
Southern Region, specifically Tamil Nadu, Kerala and Karnataka.
Middle & Lower Kolab Small Hydro Electric Projects (37 MW) Ã Orissa
The above projects located in Koraput and Malkangiri districts of
Orissa respectively are being developed by M/s Meenakshi Power Limited
(MPL) - 25 MW (2 X 12.5 MW) and M/s Whiteline Constructions Private
Limited (WCPL) Ã 12 MW ( 3 X 4 MW) respectively. However MPL will be
solely responsible to PTC for the implementation and sale of power from
the above projects. The projects are run of river type without any
pondage and are expected to be commissioned in 2005 Ã 06. A total of
around 120 MUs of energy is expected to be available from the projects.
The projects include a 220 KV transmission system upto the sale point,
the POWERGRID substation at Jeypore.
The developer submitted a tariff offer to PTC which was subsequently
negotiated and brought down to a reasonable level. Following this, an
MOU was signed with the developer in November 2001. West Bengal State
Electricity Board has agreed to purchase the entire generation and an
MOU was signed with them in March 2003.
In order to facilitate the development of the project, your Company had
taken the initiative by discussing with IREDA for the financing of the
project on terms and conditions conducive to creating a tariff stream
acceptable to the market. IREDA has now set a precedent by approving
in-principle sanction of the required loan to the developer, to be
repaid over twelve years, based on the MOU for purchase of power
between PTC and the developer and on finalization of the tariff. This
reflects the growing confidence of the various market players in your
Companys strength. PPA negotiations are currently on with the
developer.
Samal Barrage Small Hydro Electric Project (20 MW) Ã Orissa
The Samal Barrage Small Hydro Electric Project (5 X 4 MW) is being
developed by M/s Orissa Power Consortium Limited in
the Angul district of Orissa. Energy of 120 MUs per year is expected to
be available at the project busbar. The project is designed to provide
peaking power for about 6 hours a day, except during the rainy season,
when it would provide round the clock power.
An MOU was signed between PTC and the developer in June 2002. PTC is
assisting the developer to obtain financing for the project as also to
locate the final offtakers of power. PPA negotiations are also on with
the developer.
Other Projects
In addition to the above mentioned projects for which MOUs have already
been signed with the developers, several other developers have also
evinced interest in tying up with PTC for long term sale of power. PTC
is actively evaluating these projects to select the ones it considers
marketable. Some of these projects are:
- 1000 MW Karcham Wangtoo Hydro Electric Project in Himachal Pradesh
- 192 MW Allain Duhangan Hydro Electric Project in Himachal Pradesh
- 100 MW Malana à II Hydro Electric Project in Himachal Pradesh
- 70 MW Dhamwari Sunda Hydro Electric Project in Himachal Pradesh
- 1500 MW Tipaimukh Hydro Electric Project in Northern East Region
- Small Hydro Electric projects in Uttaranchal and Orissa
- 500 MW Mejia Thermal Power Plant (Units 5&6) of DVC in West Bengal
- 500 MW Chandrapura Thermal Power Station (Unit 7&8) of DVC in
Jharkhand
- 25 MW Kanoria Chemicals Thermal Power Plant in Uttar Pradesh
New Corporate / Registered Office
Your Company shifted its Corporate / Registered Office in September
2002 to its own premises at Bhikaji Cama Place. Besides well planned
workstations for the employees, the new
office provides all the modern infrastructural facilities like
conference rooms, meeting rooms, library, cafeteria and fitness centre
etc., which will go a long way in providing an excellent work
environment in your Company.
Manpower/Support Services
In line with its belief that human resources are the Companys best and
most precious assets, your Company encourages them to contribute to its
progress, prosperity and growth. At present, your Company has 52
employees which include deputationists from the Government of India,
NTPC, POWERGRID, NHPC and campus recruits from Premier Management
Institutes of India, besides support staff recruited at various levels.
Your Company believes in a lean structure with professional expertise
in core areas of functioning. It also firmly believes in attracting the
best talent available in the market for continuous renewal of the
organization and retaining them by fostering organizational loyalty
through a mix of compensatory, growth and cultural benefits. In keeping
with this philosophy, the Company
has offered an absorption package for the deputationists, who have been
key partners in the growth of your Company.
The Company has developed its own culture focusing on performance based
growth with minimum of hierarchical levels. A sense of ownership and
commitment is fostered through linking of performance to the incentive
component of their pay package.
The Company is in the process of evolving a Performance Appraisal
system with additional elements of customer related and knowledge
targets for objective feedback for developmental process. A multi rater
360 degree Appraisal system is proposed to be introduced.
PTC has participated actively in the South Asian Regional Initiative
(Energy), a program of the USAID, which has facilitated greater
appreciation of power sector issues in countries of the South Asian
Region i.e. India, Bhutan, Nepal, Bangladesh, Sri Lanka and the
Maldives, thus leading to evolution of better solutions from
cross-border energy trade. PTC has also participated in the India
Energy Partnership Programme of the USEA. It is also
proposed to have an exchange programme with the NORDPOOL, which is the
leading power pool in the world.
Knowledge Management
The Company has embarked on the first leg of integrating Knowledge
Strategy with a sound Business Strategy by setting up of an in house
corporate intranet and Knowledge Networking Site which seeks to
continuously incorporate global best practices and innovatively
disseminates information. The Knowledge Management exercise has also
been striving to codify contextual knowledge residing within key
personnel, so that relevant experiential knowledge is institutionalized
and made available to future generations of the organization.
Social responsibility
In keeping with its guiding principle to be a socially responsible
corporate citizen, your Company donated some of its office furniture,
rendered surplus during the shifting of its offices to the new
premises, to a prominent and highly reputed NGO Child Relief & You -
CRY. The gesture was wholeheartedly appreciated by CRY, who will make
use of the furniture in the project offices.
Conservation of Energy, Technology Absorption, Foreign exchange
earnings & outgo etc.
PTC being engaged in trading of power, particulars relating to
conservation of energy and technology absorption are not really
applicable to it. The Company has incurred an expenditure of Rs 6.21
lacs (net on accrual basis) in foreign exchange on payment to
consultants, traveling expenses etc. during the financial year
2002-2003.
Particulars of the employees
During the Financial Year 2002-2003, no employee who was in receipt of
gross remuneration in excess of Rs twenty four lacs per annum or Rs two
lac per month was employed for full or part of the year.
Auditors
M/s. DCG & Co., Chartered Accountants, were appointed as Statutory
Auditors of the Company for the Financial Year 2002- 2003 by C&AG of
India. The Statutory Auditors have audited the Accounts of the Company
for the Year ended 31 March 2003 and Audited Accounts together with the
Auditors Report thereon are annexed to this report. It is gratifying
to note that there are no qualifying remarks from Statutory Auditors on
the Accounts of the Company.
Review of Accounts by the C&AG of India.
The comments of Comptroller & Auditor General of India and replies of
the Company are placed at Annexe-I.
Directors Responsibility Statement
In pursuance of section 217 (2AA) of the Companies Act 1956, the
Directors make the following responsibility statement:
(i) In the preparation of the Annual Accounts, the applicable
Accounting standards have been followed by PTC along with proper
explanation relating to material departures;
(ii) The Directors had selected such Accounting policies and applied
them consistently and made judgements and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the Financial Year 2002-03 and of the
profit or loss of the Company for that period;
(iii) Proper and sufficient care was taken by Directors for maintenance
of adequate Accounting records in accordance with the provisions of the
Companies Act 1956 for safeguarding the assets of the Company and for
preventing and detecting frauds and other irregularities and
(iv) The Annual Accounts were prepared on a going concern basis.
Audit Committee
Consequent to the appointment of Shri H.L. Bajaj, as Chairman, Central
Electricity Authority, he ceased to be a Director of your
Company as also a Member of the Audit Committee of the Company w.e.f.
1.7.2002 and in his place Dr. K.K. Govil joined the Audit Committee.
Shri J. Haque joined the Audit Committee w.e.f. 2.12.2002 in place of
Shri T.N. Thakur. Presently, Audit Committee is chaired by Dr. K.K.
Govil and its two other members are Shri J. Haque and Shri S.K. Dube.
The said Audit Committee has reviewed the Annual Financial Statements,
before submission to the Board, as prescribed in section 292 (A) of the
Companies Act 1956.
Board of Directors
The following changes have taken place in the Board of Directors of the
Company since last report:-
1. Shri H.L. Bajaj representing NTPC ceased to be Director of the
Company w.e.f. 1.7.2002.
2. Shri P.I. Suvrathan representing Ministry of Power, Government of
India ceased to be Director of the Company w.e.f.10.7.2002.
3. Shri R.D. Kakkar representing POWERGRID ceased to be Director of
the Company w.e.f. 31.10.2002.
4. Shri Shyam Wadhera representing NTPC was appointed
as Director of the Company w.e.f. 8.7.2002. Now NTPC has proposed the
name of Shri R.D. Gupta to be appointed as Director representing NTPC,
who will be the substitute for Shri Wadhera who will cease to be a
Director of PTC.
5. Shri A.K. Kutty representing Ministry of Power, Government of India
was appointed as Director of the Company w.e.f. 28.10.2002.
6. Shri J. Haque representing POWERGRID was appointed as Director of
the Company w.e.f. 14.11.2002.
7. Shri A.K. Palit representing DVC was appointed as Director of the
Company w.e.f. 29.11.2002.
8. Shri S. K. Dube was appointed as Director (Operations) of the
Company w.e.f. 2.12.2002. He was earlier a part-time Director of the
Company.
9. Shri Mahendra Kumar was appointed as Director (Business
Development) of the Company w.e.f. 2.12.2002. Earlier, he was
Executive Vice President in the Company.
10. Shri F.A. Vandrewala representing Tata Power Company was appointed
as Director of the Company w.e.f. 24.2.2003.
11. Shri S.S. Jamwal representing NHPC was appointed as Director of
the Company w.e.f. 24.2.2003.
12. Shri V.K. Saxena representing Financial Institutions was appointed
as Director of the Company w.e.f. 5.5.2003.
The Board places on record its warm appreciation of the valuable
contribution made by the outgoing Directors as members of the Board.
Acknowledgment
The Board of Directors acknowledge with deep appreciation the
co-operation received from the Government of India, particularly the
Ministry of Power, State Electricity Boards, State Governments,
Regional Electricity Boards, Central Electricity Authority, Central
Electricity Regulatory Commission and State Electricity Regulatory
Commission, Power Sector Organizations viz. Power Grid Corporation of
India Ltd., National Thermal Power Corporation Ltd., Power Finance
Corporation Ltd., National Hydroelectric Power Corporation Ltd.,
Damodar Valley
Corporation and Tata Power Company, Financial Institutions viz.
Industrial Development Bank of India, Infrastructure Development
Finance Company Ltd., Life Insurance Corporation of India , General
Insurance Corporation of India and IFCI Ltd.
The Board also acknowledges with thanks the constructive suggestions
received from C&AG of India and the Statutory Auditors during the Audit
process.
The Board wishes to place on record its appreciation for efforts and
contribution made by the employees at all levels which made possible
the significant achievements by your Company.
For and on behalf of the Board of Directors
(Tantra Narayan Thakur)
Chairman & Managing Director
Place: New Delhi
Date : 20/5/2003
Mar 31, 2002
I have great pleasure in presenting to you, on behalf of the Board of
Directors, the third Annual Report on the activities of Power Trading
Corporation of India Ltd. together with the Audited Accounts for the
Financial Year 2001-2002.
Performance Highlights
The Directors are pleased to inform you that performance of your
Company during the year has been excellent in as much as, it has
achieved a turnover of Rs.364 Crores as against Rs. 11.62 Crores in the
last Financial Year (FY). The Company has earned a profit after tax of
Rs.7.35 Crores during 2001-2002 and after setting off its earlier
losses, the profit comes to Rs. 7.18 Crores, out of which an amount of
Rs. 5.7 Crores has been transferred to ÃReserves and Surplus. A maiden
dividend @ 7% on the paid up share capital of the Company has been
recommended for the FY 2001-2002.
The Company has traded 1617 MUs till March 2002 as against 43.77 MUs
traded in the preceding year. During the year, energy was bought from
the State Utilities viz. Chhattisgarh State Electricity Board, Goa
Electricity Department, West Bengal Power Development Corporation Ltd.,
Uttaranchal Power Corporation Ltd. and one IPP namely Malana Power
Company Ltd. and sold to the State Utilities viz. Karnataka Power
Transmission Corporation Ltd., Gujarat Electricity Board, Delhi Vidyut
Board and Haryana Vidyut Prasaran Nigam Ltd. Such trading opportunities
are expected to rise in future and the Company proposes to pursue
trading activities vigorously with a view to optimize utilization of
existing generation resources in the country and to meet the demand in
the deficit locations.
Against the agreement between the Company and the West Bengal Power
Development Corporation Ltd.
(WBPDCL) in Eastern Region for purchase of power upto 200 MW, the power
started flowing from WBPDCL to Delhi and Haryana w.e.f. 12 June 2001.
Your company went on enhancing power flow from different sources over
the last one year and the pattern of flow during different months of
the year is shown in the diagram.
Trading of power from Chukha and Kurichhu Power Projects is expected to
be taken over by the Company shortly during the year 2002-03. The
Company has also received some offers from Captive Power Plants and
SEBs / power departments for sale of their surplus power and the matter
is being pursued. Requests have also been received from some deficit
SEBs for purchase of Power through PTC on a short-term basis and
attempts are being made to meet their requirements from the surplus
utilities.
Financial Performance
The financial results of the Company for the FY 2001-2002 are
summarized as under :
Financial Highlights
Figures in Rs. Lacs
Income
Electricity Sales 35,402.53
Service charges 307.88
Rebate on purchase of power 683.06
Other income 246.41
Total 36,639.88
Less
Electricity Purchase 34,901.70
Rebate on sale of power 746.96
Employee Cost 99.14
Other Expenses 76.50
Foreign Exchange Fluctuation 14.05
Total 35,838.35
Amortization and Depreciation 35.64
Profit before tax 765.89
Provision for Taxation 31.16
Net Profit After Tax 734.73
Adjustment of previous losses 16.21
Proposed dividend 148.32
Reserve and Surplus
(Balance Carried forward to Balance Sheet) 570.20
Share capital
As on 31st March 2002, the Companys Authorized Capital was Rs. 150
Crore and paid up equity capital was Rs. 24 Crore, received from its
three Promoter Companies viz. Rs. 12 Crore from Power Grid Corporation
of India Ltd. and Rs. 6 Crore each from National Thermal Power
Corporation Ltd. and Power Finance Corporation Ltd. The equity will be
raised in line with the fund requirements of the Company as per its
Business Plan. Discussions are underway with the FIs and Investment
Companies viz. ICICI, IDBI, IFCI, IDFC, LIC and GIC to finalize the
terms and conditions of Equity Participation. A Meeting was also
convened on 7 May 2002 at Mumbai between PTC and the Financial
Institutions, where various issues of equity participation in PTC were
discussed and equity participation of some of these organisations in
PTCs equity capital is expected soon. With widening of equity base,
the Company will have better leverage to undertake trading operations.
Directors Responsibility Statement
In pursuance of section 217 (2AA) of the Companies Act 1956, the
Directors make the following responsibility statement:
(i) In the preparation of the Annual Accounts, the applicable
Accounting Standards have been followed by PTC along with proper
explanation relating to material departures;
(ii) The Directors had selected such Accounting policies and applied
them consistently and made judgements and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the Financial Year 2001-02 and of the
profit or loss of the Company for that period;
(iii) Proper and sufficient care was taken by Directors for maintenance
of adequate Accounting records in accordance with the provisions of the
Companies Act 1956 for safeguarding the assets of the Company and for
preventing and detecting frauds and other irregularities and
(iv) The Annual Accounts were prepared on a going concern basis.
Audit Committee
Consequent to the appointment of Shri Rakesh Nath, as Chairman, Bhakra
Beas Management Board, he ceased to be a Director as also the Member of
the Audit Committee of Company w.e.f. 16.10. 2002 and in his place Shri
T.N. Thakur, Chairman & Managing Director joined the Audit Committee on
3.12.2001. The said Audit Committee reviewed the Annual Financial
Statements, before submission to the Board, as prescribed in section
292 (A) of the Companies Act 1956.
Trading of Power
As stated earlier, PTCs trading touched a figure of 1617.43 MUs of
energy during the year 2001-02 as against 43.77 MUs during the previous
year. PTC purchased 807.83 MUs from WBPDCL for supply to DVB (504.89
MU) & HVPNL (302.94 MUs), 150.13 MUs from Malana Power Company, a
private generating company, for sale to DVB, and 34.80 MUs from
Uttaranchal Power Corporation for sale to DVB, 320.24 MUs from Goa for
sale to GEB (237.60 MUs) & KPTCL (82.64 MUs) and 304.43 MUs from CSEB
for sale to KPTCL (297.28 MUs) & DVB (7.15 MUs).
Trading Highlights
160 MW From West Bengal to Delhi & Haryana
70 MW From Himachal to Delhi (Private Hydro Power)
50 MW From Goa to Gujarat
25 MW From Goa to Karnataka
100 MW From Chhattisgarh to Karnataka
100 MW From Chhattisgarh to Delhi (Peaking power)
50 MW From Uttaranchal to Delhi
Another 400-500 MW transaction is being finalised shortly.
All the agreements for purchase and sale of power were signed for the
varying period upto one year. It is expected that PTC may be able to
extend the trading of power against the existing agreements. HVPNL,
HPSEB, PSEB, JSEB and APTRANSCO have shown interest in sale of seasonal
surplus power and many other states have shown interest in purchase of
power through PTC. PTC is getting the technical feasibility examined
for trading of power from different sources and taking up the matter to
convert such opportunities to physical trading of power.
Indo-Nepal Power Exchange
PTC, nominated by Govt. of India in July 2001 as the nodal agency for
Indo-Nepal power exchange, has been interacting with Nepal Electricity
Authority (NEA) and the concerned agencies in India for import of
surplus power from Nepal and on the issue of formulation of tariff
based on commercial principles for exchange of power between the two
countries.
During a high level meeting held in Kathmandu, Nepal in September 2001,
NEA informed that with the commissioning of Kaligandki H.E. Project
(144 MW), they would be surplus in power by 100-150 MW during the
months of May to October from year 2002 to year 2017.
The present interconnections are not adequate to support the level of
exchange of 100-150 MW power and only about 35-40 MW of import seems to
be feasible in the short term. Matter has been taken up with CEA and
POWERGRID for construction of 132 KV D/C Anandnagar (UP) Ã Butwal
(Nepal) line on priority that may help to enhance the exchange.
PTC is in the process of identifying the potential buyers in Northern
Region and finalizing modalities including tariff for import of surplus
power from Nepal. A joint system study to synchronize one of the hydro
stations of Nepal with Indian grid is also proposed for operational
flexibility and to enhance power exchange.
Chukha Power Project (Bhutan)
Government of India (GoI), Ministry of power entrusted purchase and
sale of surplus power from 336 MW Chukha H.E project (CHPC) located in
Bhutan (which is currently being dealt by POWERGRID) to PTC. In view of
the fact that payment to CHPC has to be released within a specified
time and PTC being in formative stage with a limited Capital base, MOP
advised PTC to arrange for opening of Letter of Credit by the
off-taking SEBs before taking over trading of Chukha power. PTC has now
signed agreements with all the Eastern Region constituents with
provision for payment through LC and taken up the matter for the
Payment Security Mechanism matching with payment conditions.
Draft Agreement for supply of power by Bhutan to India through PTC has
already been sent by GoI to Royal Government of Bhutan (RGoB), which is
likely to be finalized shortly.
Kurichhu Power Project (Bhutan)
First three units of 60 (4 X 15) MW Kurichhu power project in Bhutan
were commissioned by Kurichhu Project Authority during the year. This
power is to be shared by WBSEB and DVC on 50 : 50 basis. PTC has
already taken up the matter with WBSEB and DVC for signing of agreement
for purchase of Kurichhu Power. Currently, Kurichhu power is being
traded by POWERGRID and the matter is under consideration with the
Government of India to fix the date for transfer of Kurichhu power from
POWERGRID to PTC alongwith the transfer of assignment of trading of
Chukha power.
Trading of Surplus Power from WBPDCL
PTC has signed an agreement with West Bengal Power Development
Corporation Ltd. (WBPDCL) for purchase of power upto 200 MW till
February 2002. Power to the extent of around 150 MW (about 3 MU energy
daily) started flowing w.e.f. 12 June 2001 and is being sold to Delhi
Vidyut Board and Haryana Vidyut Prasaran Nigam.
Malana Power
Malana Power Company Ltd. (MPCL)s 86 MW Malana Hydro Power Project in
Himachal Pradesh has started generating power w.e.f. 5 July 2001. PTC
has signed an agreement with MPCL for purchase of their entire power
(after adjustment of free power admissible to HP Government and losses
in the HPSEB transmission system) for a period of one year. Memorandum
of Understanding has also been signed with Delhi Vidyut Board for sale
of the above power and the power is being supplied to DVB w.e.f. 5
July 2001.
Brief Status of the Projects/ Activities
Hirma Mega Power Project (6X660MW)- Orissa
The Development Agreement for the project, on the lines of MOU, was
signed on 14 September 2000 in Washington DC during the Prime
Ministers official visit to USA. Mirant Asia Pacific Limited (MAPL),
earlier Southern Energy Asia Pacific (SEAP), and Reliance Power Ltd.
(RPL) were the sponsors of the Project with net capacity of 3960 MW and
the Power is to be shared by the states of Rajasthan, Punjab, Haryana,
Gujarat and Madhya Pradesh. MAPL have now withdrawn from the project
and Reliance Group have shown interest in developing the project. PTC
has approached the Government of India to obtain their clearance for
assignment of the MOU in favour of Reliance Group.
Vide their order-dated 26 September 2000, CERC awarded tariff for this
project according to which the levelised Fixed Charge will be at Rs
1.3398 per KWh at constant prices for 30 years. This corresponds to 74%
front-loading at current price with use of super critical boilers and
at an availability/PLF of 85%. Heat rate for the super critical boilers
will be 2411 kcal/KWh (as against 2460 for sub-critical boilers). For
dispatches above 85% PLF, incentive would be payable at 1 paise per KWh
for every 1% increase in PLF. MAPL filed a review petition before CERC
for review of the tariff order dated 26th September 2000. CERC admitted
the petition and hearings on the same concluded in October 2001. CERC
had also noted the reply of MoP regarding PSM for the Mega Power
Project and have since reserved the order on the petition.
Mahanadi Coalfields Ltd. (MCL) has identified coal mines in the Ib
Valley for supply of 22.4 million tones of coal per annum and it is
expected that coal would be available entirely from Ib Valley thereby
obviating the need to transport shortfall quantity of coal from other
coalfields.
A series of meetings took place between developer and PTC since October
2000, till August 2001 in regard to Power Purchase Agreement. Whereas
many of the issues could be resolved, some of the issues like risk
sharing, liquidated damages, termination and buy-out could not be
resolved largely for want of details of PSM. Technical / Operational
issues of PPA were also discussed with the developer in a number of
meetings and PTC has put forward its position / views on various issues
of this nature. Further discussion on the commercial terms is held up
on the issues having direct or indirect link with the PSM. The
discussions on the PPA will be concluded after the PSM is firmed up and
coal supply sources to the project finalised.
A meeting was called by CEA in January 2002 to consider Techno-
Economic Clearance (TEC) of the Transmission System of Hirma Power
Project. Various issues like clearance of project, associated
transmission system etc. were discussed. CEA raised a question about
clearance of Hirma Power Project by the competent authority as per
Electricity (Supply) Act, 1948. PTC and the Developer have referred the
matter to MoP for examination and advice.
Implementation Agreement between the Developer and the Government of
Orissa for provision of State support like land acquisition,
arrangement of water, construction power etc. is another important
agreement to be finalised on priority and is already discussed between
the two at the highest level and PTC have extended necessary help, as
required.
Ennore LNG based Power Project
(5 X 370 MW) ÃTamil Nadu
Development of this project, based on imported LNG, was taken up by
Tamil Nadu Industrial Development Corporation Ltd. (TIDCO) for sale of
entire power to TNEB. TIDCO had selected M/s Dakshin Bharat
Energy Consortium (DBEC) as the preferred bidder, based on
International Competitive Bidding. However, Tamil Nadu was not in a
position to absorb the entire power from this project and MOP advised
PTC to locate other buyers in the Southern Region for sale of surplus
power. Joint Development Agreement was signed for the project in
Washington DC between PTC and the sponsors on 14 September 2000. The
major strength of this project is the fixed price of LNG in US Dollar
term for the entire PPA term of 20 years after commissioning of the
Project.
Tamil Nadu has confirmed offtake of 750 MW power from the Project and
signed MOU with PTC on 5 October 2000. Karnataka had signed MOU for
offtake of 300 MW. Kerala has shown willingness to take 200 MW power.
Madhya Pradesh has also indicated willingness to take 400-500 MW power
if tariff is competitive. Draft MOUs have already been forwarded to the
other SEBs. The discussions on PPA with DBEC have not progressed as
signing of MOUs with the beneficiaries other than TNEB & KPTCL and
finalisation of the Payment Security Mechanism are pending.
Pipavav Mega Power Project (2000 MW) ÃGujarat
PTC filed a petition to CERC on 13th April 2000 for approval of RFP
document incorporating the bidding methodology, evaluation criteria,
tariff structure, PPA and procedures to be followed. On the direction
of CERC, PTC had filed Vol. 1 of amended RFP document on 31st January
2001. Revision of Vol. II and Vol. III was held up for finalisation of
compensation for Environmental impact asked by Gujarat, State Support
Agreement conditions to be issued by the Government of Gujarat and the
PSM to be provided by the offtaking states of Gujarat and Rajasthan.
In view of delay in the required commitments from the concerned States
during the meeting, CERC dismissed the petition hearing on 5th December
2001 and granted liberty to PTC to file a fresh petition after
necessary requirements and finalisation of revised documents.
In light of CERC order, the matter is being persued with the respective
Governments for early resolution of long pending issues to enable PTC
to finalise the RFP documents. PTC has also taken up the matter with
MoP to intervene in the matter.
Maithon Right Bank Thermal Power Project (1000 MW) - Jharkhand
Maithon Right Bank Thermal Power Project is being implemented as a
joint venture between Damodar Valley Corporation and BSES Ltd. in the
State of Jharkhand. MoP had advised PTC to purchase this power and sell
to states in the Northern Region. PTC had initiated the process to
identify beneficiary states in the Northern Region interested in
purchase of Maithon power. Initially pooling of power from Maithon and
Tala hydroelectric project in Bhutan to optimize the cost of
transmission was discussed.
However, later on Tala power was allocated to Eastern Region
constituents and transmission system for evacuation of Maithon Power to
the beneficiaries in the Northern Region will have to be seen
separately.
Special Secretary (Power) has taken a review on the status of Maithon
Project on 2nd January 2002 and has identified the responsibilities for
further development of the project. BSES has made a presentation on the
project on 19th March 2002 in PTC office giving highlights of the
project and the progress achieved so far. BSES have informed that they
would come back with a revised tariff offer for sale of power from the
project, which is expected to be competitive.
West Seti Hydroelectric Power Project (750 MW) Ã Nepal
M/s West Seti Hydro Electric Corporation (SMEC) proposes to develop a
750 MW Hydro Power Project in Nepal. SMEC has submitted their technical
and commercial proposals in the form of a Ãtariff based project, which
have been discussed with them during various meetings. Most of the
technical issues raised during the meetings on the proposal have
generally been accepted by SMEC and will be either incorporated in the
revised documents to be submitted by them or considered during detailed
design or during further investigations. Through a series of
discussions, PTC could bring down the proposed tariff. Even though the
tariff still appears to be higher but the project has distinct
advantage of peaking power for 8 hours round the year. PTC will now
approach the State Power Utilities to check the acceptability of the
tariff and to the Government of India to seek permission for purchase
of power.
Office Accommodation
PTC has purchased an office accommodation at Bhikaji Cama Place, from
M/s. National Building Construction Corporation Ltd. (NBCC), a
Government of India Undertaking, during February 2002. The Company will
shift its Corporate/ Registered office to the new premises, after
completion of the interior work, for which action has already been
initiated.
Manpower
PTC has a lean manpower and the total strength of employees as on date
is 42, which includes 28 deputationists from Govt. of India, NTPC,
POWERGRID & NHPC. The company has made a campus selection of 7
Management Associates and one Asst. Manager from five prestigious
Management Institutions.
The organizational structure and culture are under review in
consultation with Management Development Institute (MDI), Gurgaon to
develop PTCs own business process and structure in the backdrop of its
unique and new concept of activities.
Conservation of Energy, Technology Absorption, Foreign Exchange
Earnings & Outgo etc.
PTC being engaged in trading of power, particulars relating to
conservation of energy and technology absorption are not applicable to
it. The Company has incurred an expenditure of Rs 16.24 lacs in foreign
exchange (on accrual basis) on payment of consultants, travelling
expenses etc. during the financial year 2001-2002.
Particulars of the Employees
During the Financial Year 2001-2002, no employee was employed for full
or part of the year who was in receipt of gross remuneration inÃexcess
of Rs. 24 lacs per annum or Rs. 2 lakh per month.
Auditors
M/s. DCG & Co., Chartered Accountants were appointed as Statutory
Auditors of the Company for the Financial Year 2001-2002 by C&AG of
India. The Statutory Auditors have audited the Accounts of the Company
for the Year ended 31 March 2002 and Audited Accounts together with the
Auditors Report thereon are annexed to this report. It is gratifying
to note that there are no qualifying remarks from Statutory Auditors on
the Accounts of the Company.
Review of Accounts by the C&AG of India.
The Comptroller & Auditor General of India has no comments upon or
supplement to the Auditors Report under section 619(4) of the
Companies Act 1956 on the Accounts of the Company for the year 2001-02
and his report is enclosed at Annexe-I.
Board of Directors
Consequent to the appointment of Shri Rakesh Nath as Chairman, Bhakra
Beas Management Board, he ceased to be a Director of the Company w.e.f.
16.10.2002. The Board placed on record its warm appreciation of the
valuable contribution made by Shri Rakesh Nath as Member of the Board.
Acknowledgment
The Directors acknowledge with deep appreciation the co-operation
received from the Government of India, particularly the Ministry of
Power, three Promoter Companies viz. Power Grid Corporation of India
Ltd., National Thermal Power Corporation Ltd. and Power Finance
Corporation Ltd., State Electricity Boards, State Governments, Regional
Electricity Boards, Central Electricity Authority and Central
Electricity Regulatory Commission.
The Directors further acknowledge with thanks the constructive
suggestions received from C&AG of India and the Statutory Auditors
during the Audit process.
The Directors wish to place on record their appreciation for efforts
and contribution made by the employees at all levels which made
possible the significant achievements during the third year of
operations of the Company.
For and on behalf of the Board of Directors
(Tantra Narayan Thakur)
Chairman & Managing Director
Place: New Delhi
Date: 16th May, 2002
Mar 31, 2001
I have great pleasure in presenting to you, on behalf of the Board of
Directors, the second Annual Report on the activities of Power Trading
Corporation of India Ltd. together with the Audited Accounts for the
Financial Year 2000-2001.
Performance Highlights
Your Company has been able to improve upon its performance over last
year on almost all the fronts. The total amount of power sold was Rs
11.39 Crores, which is 47.7% higher than Rs 7.71 Crores sold in the
year 1999-2000.
During the year, energy was bought from Maharashtra State Electricity
Board and Punjab State Electricity Board and sold to Karnataka Power
Transmission Corporation Ltd. and Gujarat Electricity Board,
respectively. Such trading opportunities are expected to rise in future
and the Company proposes to pursue trading activities vigorously for
optimum utilization of existing resources in the country and to meet
the demands in the deficit locations.
An agreement was signed in February 2001 between the Company and the
West Bengal Power Development Corporation Ltd. (WBPDCL) in Eastern
Region for purchase of power upto 200 MW for supply to the neighbouring
regions. Power upto 150 MW has started flowing from WBPDCL to Delhi and
Haryana w.e.f 12 June 2001. Another transaction for short term trading
of power from Malana Power Project to Delhi Vidyut Board to the tune of
70 MW has materialized w.e.f. 5 July 2001. Trading of power from Chukha
Power Project is expected to be taken over by the Company during the
year 2001-02. PTC has also received some offers from Captive Power
Plants and SEBs / Power Departments for sale of their surplus power and
the matter is being pursued. Requests have also been received from
some deficit SEBs for purchase of power through PTC on a short- term
basis and attempt is being made to meet their requirements from the
surplus utilities.
Financial Performance
During the first year of operation, PTCs paid-up capital was Rs 6
Crores with the subscription of the Promoter Companies, viz., Rs 3
Crores from POWERGRID and Rs 1.5 Crores each from NTPC and PFC However,
as envisaged in the Business Plan finalized in May 2000, PTC requires
paid-up equity base of Rs 40 Crores upto Financial Year 2000-2001 and
Rs 61 Crores upto 2001-02. Accordingly, during the year, the Promoter
Companies were requested to enhance their equity to Rs 24 Crores (i.e.
60% of Rs 40 Crores). The additional subscription of Rs 18 Crores from
the three Promoter Companies has since been received. For the balance
Rs 16 Crores, discussions are underway to finalize the terms and
conditions of Equity Participation with the FIs viz. ICICI, IDBI, IFCI
and IDFC. Further, LIC and GIC have also in principle, agreed to
subscribe to the equity capital of PTC to the tune of Rs 4 Crores and
Rs 2 Crores, respectively. UTI also have shown positive response. PTC
will raise further equity as per requirements from time to time. With
widening of equity base, the Company has somewhat better leverage to
undertake trading operations.
The Company has earned Rs 94 lacs from sale of power and other income
during 2000-01.This includes an income of Rs 70.58 lacs on account of
investment of funds in the short-term deposits and inter- corporate
deposits with various Scheduled Banks.
During the Financial Year 2000-01, the Company has incurred a marginal
loss of Rs 10.21 lacs. The Company has followed prudential Accounting
norms and policies, as adopted in the 13th Board Meeting held on 28 May
2001, while preparing its Accounts for the year 2000-01. During the
year, the Company has revised its Accounting policy relating to
treatment of expenditure incurred on development of power projects.
According to the revised Accounting policy, any expenditure incurred on
development of potential power projects shall be carried forward as
deferred revenue expenditure to be written off equally in five years
beginning with Financial Year 2003-04.
Directors Responsibility Statement
In pursuance of section 217 (2AA) of the Companies Act, 1956, the
Directors make the following responsibility statement:
(i) In the preparation of the Annual Accounts, the applicable
Accounting standards have been followed by PTC along with proper
explanation relating to material departures;
(ii) The Directors had selected such Accounting policies and applied
them consistently and made judgements and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the Financial Year 2000-01 and of the
profit or loss of the Company for that period;
(iii) Proper and sufficient care was taken by Directors for maintenance
of adequate Accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting frauds and other irregularities, and
(iv) The Annual Accounts were prepared on a going concern basis.
Audit Committee
The Board of Directors in its 12th meeting held on 9 March 2001,
constituted an Audit Committee in accordance with section 292 (A) of
the Companies Act, 1956, consisting of three members, namely Shri H.L.
Bajaj, Shri Rakesh Nath and Shri S.K. Dube. Shri H.L. Bajaj has been
appointed as the Chairman of the Audit Committee in the first Meeting
of the Audit Committee held on 28 May 2001. The said Audit Committee
has reviewed the Annual Financial Statements, before submission to the
Board, as prescribed in section 292 (A) of the Companies Act, 1956.
Payment Security Mechanism
Payment Security Mechanism (PSM) for PTCs long-term PPAs with regard
to large projects is under active consideration of the Government of
India (GoI). The proposed mechanism, including the process of dip into
the central devolution of funds to the states as a fall back
arrangement in case of default in payment, is under discussions at
different levels in GoI.
Brief Status of the Projects/Activities
Hirma Mega Power Project (6x660 MW) - Orissa
The Development Agreement for the project, on the lines of MoU, was
signed on 14 September 2000 in Washington DC during the Prime
Ministers official visit to USA.
Tariff
Mirant Asia Pacific Limited (MAPL), earlier Southern Energy Asia
Pacific (SEAP), and Reliance Power Ltd. (RPL) are the sponsors of the
Project with net capacity of 3960 MW and the Power is to be shared by
the states of Rajasthan, Punjab, Haryana, Gujarat and Madhya Pradesh.
Vide their order-dated 26 September 2000, CERC awarded tariff for this
project according to which the levelised Fixed Charge will be at Rs
1.3398 per kWh at constant prices for 30 years. This corresponds to 74%
front-loading at current price and an availability/PLF of 85%. This
tariff is determined with reference to super critical boiler
technology. Heat rate for the super critical boilers will be 2411 kcal/
kWh (as against 2460 for sub-critical boilers). For dispatches above
85% PLF, incentive would be payable at 1 paise per kWh for every 1%
increase.
Fuel Supply Agreement
Mahanadi Coalfields Ltd. (MCL) had identified coal mines in the Ib
Valley for supply of 22.4 million tonnes of coal per annum. However,
one of the coal mines viz. Kulda project has not been given forest
clearance by the Ministry of Environment & Forests (MOE&F). The matter
is being reviewed by them (MOE&F). Even with the development of Kulda
mine, there is a possibility of shortfall in coal supply in the initial
years of operation of the project and there is a suggestion to meet the
shortfall from Talcher. However, efforts are being made to tie up the
full requirement from Ib Valley mines to avoid transportation of coal
from Talcher which would result in increase in tariff of the project as
also add transportation risk.
Power Purchase Agreement
The draft Heads of Terms for PPA-1, to be signed between PTC and the
project Company, were evolved by PTCs consultants ICICI and finalized
after series of discussions amongst the beneficiary States/SEBs, MOP,
CEA, PTC, ICICI and MAPL. PPA Committee was reconstituted by the
Ministry of Power in July 2000. A number of rounds of discussions have
taken place with the help of commercial and legal consultants, the last
one in April 2001. The discussions on the PPA will be concluded after
the Payment Security Mechanism is firmed up and coal supply sources to
the power project finalised.
Other Agreements
Implementation Agreement between the Developer and the Government of
Orissa for provision of State support like land acquisition,
arrangement of water, construction power etc. is another important
agreement to be finalised on priority and is already discussed between
the two at the highest level and PTC have extended necessary help, as
required.
Ennore LNG Based Power Project (5x370 MW) - Tamil Nadu Development of
this project, based on imported LNG, was taken up by Tamil Nadu
Industrial Development Corporation Ltd. (TIDCO) for sale of entire
power to TNEB. TIDCO had selected M/s Dakshin Bharat Energy Consortium
(DBEC) as the preferred bidder, based on International Competitive
Bidding. However, Tamil Nadu was not in a position to absorb the entire
power from this project and MOP advised PTC to locate other buyers in
the Southern Region for sale of surplus power. Joint Development
Agreement was signed for the project in Washington DC between PTC and
the sponsors on 14 September 2000. The major strength of this project
is the fixed price of LNG in US Dollar term for the entire PPA term of
20 years.
Tamil Nadu has confirmed offtake of 750 MW from the Project and signed
MOU with PTC on 5 October 2000. Karnataka had indicated to take a share
of 700 MW, but they have revised their requirement to 300 MW and MOU
for the same is yet to be signed. Kerala has shown willingness to take
200 MW. Madhya Pradesh has also indicated willingness to take 400- 500
MW if tariff is competitive. Draft MOUs have already been forwarded to
the other SEBs. The discussions on PPA with DBEC have been suspended
pending signing of MOUs with the beneficiaries other than TNEB and
finalisation of the Payment Security Mechanism.
Pipavav Mega Power Project (2000 MW)-Gujarat
Pursuant to revised Mega Power Policy, pre-qualification proposals were
invited for the project by POWERGRID (on behalf of PTC, pending
incorporation of PTC) in January 1999 through ICB route. Gujarat and
Rajasthan will be the beneficiaries of the Project with share of 1500
MW and 500 MW respectively. Bidders were given the choice to structure
the Project on imported fuel, either coal or Liquified Natural Gas
(LNG).
CERC issued an order in January 2000 regarding applicability of
Availability Based Tariff (ABT) for Central Sector Generating Stations
of NTPC. In response to the petition filed by PTC in February 2000,
CERC issued an order on 9 March 2000 advising that the target
availability concept may not be applicable to the projects through
competitive bidding. Accordingly, PTC filed a petition to CERC on 13
April 2000 for approval of bidding methodology, evaluation criteria,
tariff structure, PPA and procedures to be followed, as covered in the
RFP On the direction of CERC, PTC had filed Vol.I of amended RFP
document on 31 January 2001. Revision of RFP Vol. II and III is held up
for want of State Support Agreement conditions to be issued by the
Government of Gujarat and PSM.
Trading of Power
Indo-Nepal Power Exchange
The power exchange between India and Nepal is presently at the level of
50 MW and there is a proposal to enhance the exchange to 150 MW.
Government of India, Ministry of External Affairs (MEA), in July 2001,
formally intimated His Majestys Govt. of Nepal about appointment of
PTC as the Nodal Agency to deal with matters relating to exchange of
power between the two countries. PTC has compiled information on the
power exchanges with Nepal and also convened a meeting with concerned
agencies viz. UPPCL, BSEB, Bihar Irrigation Department, NHPC,
POWERGRID and CEA with a view to flag the issues that need to be
resolved, steps to be taken for formulation of tariff based on
commercial principles and enhancing the power exchange for mutual
benefit of both the countries. PTC is also planning to organise an
official meeting with Nepal Electricity Authority (NEA) for discussions
on various issues such as modalities for billing and realisation,
settlement of outstanding dues, techno-economic feasibility for
potential power trade, formulation of tariff for future power exchange,
etc.
Chukha Power (Bhutan)
Government of India, Ministry of power entrusted purchase and sale of
surplus power from 336 MW Chukha H.E. project (CHPC) located in Bhutan
(which is being dealt by POWERGRID) to PTC, date for the transfer has
to be announced separately. In view of the fact that payment to CHPC
has to be released within a specified time and PTC being in formative
stage with a limited Capital base, MOP advised PTC to arrange for
opening of Letter of Credit by the offtaking SEBs before taking over
trading of Chukha power. PTC has now signed agreements with WBSEB,
BSEB, GRIDCO and DVC with provision for payment through LC. The
Agreement with Government of Sikkim and Jharkhand SEB is likely to be
signed shortly, after which PTC is expected to take over the
assignment.
Surplus Power from Punjab to Gujarat
PTC traded 42.325 MU of energy from Punjab to Gujarat during the months
of November and December 2000 with total earnings of Rs 21.09 lacs to
the Company.
Surplus Power from WBPDCL
PTC has signed an agreement with West Bengal Power Development
Corporation Ltd. (WBPDCL) for purchase of power upto 200 MW till
February 2002. Power to the extent of around 150 MW (about 3 MU energy
daily) started flowing w.e.f. 12 June 2001 and sold to Delhi Vidyut
Board and Haryana Vidyut Prasaran Nigam.
Malana Power
Malana Power Company Ltd. (MPCL)s 86 MW Malana Hydro Power Project in
Himachal Pradesh has started generating power w.e.f. 5 July 2001. PTC
has signed an agreement with MPCL for purchase of their entire power
(after adjustment of free power admissible to HP Government and losses
in the HPSEB transmission system) for a period of one year after
commencement of generation. Memorandum of Understanding has also been
signed with Delhi Vidyut Board for sale of the above power. About 1 to
1.5 MU are being supplied daily to DVB w.e.f. 5 July 2001.
Other Trading Opportunities
PTC has taken up with GRIDCO, Maharashtra State Electricity Board,
Chattisgarh State Electricity Board, Punjab State Electricity Board and
Government of Goa for trading of their surplus power. Some captive
power plants have also approached the Company for trading of their
surplus power and possibilities are being explored for the same.
Energy Conservation, Technology Absorption, Forex Earnings & Outgo etc.
PTC being engaged in trading of power, particulars relating to
conservation of energy and technology absorption are not really
applicable to it. The Company has incurred an expenditure of Rs 52.36
lacs in foreign exchange on engagement of consultants etc. during the
financial year 2000-2001.
Website
PTCs Website (www.ptcindia.com) was launched on 8 February 2001
containing information on PTCs profile, vision, details of projects,
trading activities, financial details, Buyers & Sellers registration
etc. in order to facilitate on-line trading. Buyers and Sellers are
now able to approach PTC for power transactions through this website.
For this, standard formats have been devised and put on the Website.
PTC is receiving fairly good response from the buyers as also from the
sellers. Regional coordinators have been identified to respond promptly
to the queries. Website is regularly updated to ensure that the latest
information about the Company is made available to the stake holders.
Business Plan
Keeping in view the objectives of PTC, a Business Plan had been
prepared in May 2000, by PTCs Consultants- ICICI, which was to be
reviewed every year in the backdrop of vast changes taking place in the
energy sector. Accordingly, ICICI was entrusted with the task of
assisting PTC in revising the earlier Business Plan for short and
medium terms to take into account the revised estimates of future
trading opportunities as also the changes in assumptions with respect
to the present status of development of Mega Power Project in the
country. The draft Business Plan was discussed in the 13th Board
Meeting and suggestions regarding optimal level of liquidity required
by PTC for its operations have been incorporated by the consultant.
Accordingly, the draft Business Plan would now be discussed with the
potential investors, finalised based on the feedback thereof and
accordingly would then be adopted for implementation.
Manpower
At present, all the employees working in PTC are on deputation from the
Promoter Companies like NTPC, POWERGRID, Government of India and other
Power utilities like NHPC except one Asstt. Company Secretary who is on
the Companys rolls. The employees relations in the Company have been
very harmonious and constructive. All employees have regular
interaction with the management at different levels.
Particulars of the Employees
During the Financial Year 2000-2001, no employee was employed for full
or part of the year who was in receipt of gross remuneration in excess
of Rs 12 lacs per annum or Rs 1 lac per month.
Auditors
M/s. K.N. Goyal & Co., Chartered Accountants were appointed as
Statutory Auditors of the Company for the Financial Year 2000-2001 by
C&AG of India. The Statutory Auditors have audited the Accounts of the
Company for the Year ended 31 March 2001 and Audited Accounts together
with the Auditors Report thereon are annexed to this report. It is
gratifying to note that there are no qualifying remarks from Statutory
Auditors on the Accounts of the Company.
Review of Accounts by the C&AG of India
The Comptroller & Auditor General of India has no comments upon or
supplement to the Auditors Report under section 619(4) of the
Companies Act, 1956 on the Accounts of the Company for the year 2000-01
and his report is enclosed at Annexe-I.
Board of Directors
As per the Articles of Association of the Company, the first Directors
of the Company retired at the first Annual General Meeting of the
Company held on 11 October 2000. Shri P.I. Suvrathan, H.L. Bajaj, R.D.
Kakkar and S.K. Dube were appointed as part- time Directors of the
Company in the first Annual General Meeting of the Company. Dr. K.K.
Govil, Director (Projects), PFC joined the Board of the Company on 9
March 2001.
Acknowledgements
The Board of Directors acknowledge with deep appreciation the
co-operation received from the Government of India, particularly the
Ministry of Power, three Promoter Companies viz. Power Grid Corporation
of India Ltd., National Thermal Power Corporation Ltd. and Power
Finance Corporation Ltd., State Electricity Boards, State Governments,
Regional Electricity Boards, Central Electricity Authority and Central
Electricity Regulatory Commission.
The Board also acknowledges with thanks the constructive suggestions
received from C&AG of India and the Statutory Auditors during the Audit
process.
The Board wishes to place on record its appreciation for efforts and
contribution made by the employees at all levels which made possible
the significant achievements during the very second year of the
Company.
For and on behalf of the Board of Directors
(Tantra Narayan Thakur)
Chairman & Managing Director
Place: New Delhi
Date : 25.07.2001