From which year can we see the commissioning of PSP projects? What will be the realization and CAPEX for these projects?
Ragini, we have not started any construction of PSP projects. So, it is very early to say about realization and other thing because the fastest running project in the ambit of this PSP project is Omkareshwar-Indira Sagar (640 MW) Project. We are expecting to start construction activities there during the current fiscal. Once we get everything in place and we start construction activities, we will have better clarity about the realization, the tariff and everything. So, give us some time to share more facts about this Omkareshwar-Indira Sagar Project.
What is the Adjusted PAT for the quarter? What was the profit in Subansiri and Parbati-II in Q4 and the fiscal?
Mohit, You have seen the Reported PAT. So, if you want to reach at the Adjusted PAT, as D(F) sir has shared with you that there was one-off tax adjustment in DTL, because we all know that we have opted for the lower tax regime of 25% under Sec. 115BAA as MAT Credit facility is going to be discontinued from FY'27 onwards. Therefore, whatever deferred tax liability we had created at higher rate, that needs to be restricted at 25%. So, their impact is around Rs. 1,156 Crore which we have already reported under note #8 of our financial results. So, net impact of this deferred tax liability adjustment comes to around Rs. 900 Crore. So, if you reduce Rs. 900 Crore from the Reported PAT, you will arrive at Adjusted PAT. So far the profitability of Parbati-II and SLP is concerned, we have earned Rs. 104 Crore profit from Parbati-II in Q4 and Rs. 487 Crore profit from SLP in Q4. On yearly basis, Parbati-II has given a loss of Rs. 150 Crore whereas on yearly basis, SLP has given a total profit of Rs. 495 Crore.
Why Parbati-III seems to have been shut for the last few months, is there any particular reason?
Yes, actually some maintenance was going on there and these units are already resumed.
Parbati reported a profit in the 4th Quarter versus a loss for the full year. What is leading to the profit improvement? At what percentage are we billing Parbati and Subansiri?
Yes, so basically at the end of the financial year, we compute the shortfall of energy which we are supposed to recover. So in Parbati-II, we have shortfall of energy to the extent of Rs. 200 Crore which has been booked under revenue. That is the reason Parbati-II has given the profit of Rs. 104 Crore in Q4. We have already started billing of Parbati-II based on the interim tariff notification of CERC. So 75% billing, we are already doing there. For Subansiri, we are waiting for the interim tariff notification of CERC and we will be starting it once we get the interim tariff notification of Subansiri Lower.
When do we see the tariff adoption come through for both Subansiri and Parbati?
Aniket, we have the next hearing date of Parbati-II on 25th of this month only. So, there we are expecting that orders will be reserved. Hopefully, on 25th May, this tariff petition hearing will be completed and the order will be reserved. We will be expecting the final orders by the end of this quarter. For Subansiri, we have already filed the tariff petition and we are expecting interim tariff order first, thereafter, there will be a hearing for provisional order. As in case of Parbati-II, first interim order was issued by CERC. After that, we have been able to bill at the rate of 75% of the filed tariff. Similarly, in case of Subansiri Lower, CERC will be issuing this interim order first and thereafter, we are expecting in another six months or so after this interim tariff is issued by CERC in respect of Subansiri Lower.
What is the under-recovery on profits if billing at 75% of revenue?
Aniket, just to reply to your question, so far we have booked Rs. 1,320 Crore of revenue in Parbati-II at 80% of the AFC. If you gross up this Rs. 1,320 Crore, you will arrive at somewhere Rs. 1,600-odd Crore. So, there is an under-recovery of Rs. 300 Crore if you look at the filed tariff petition of Parbati-II. So, Rs. 300 Crore kind of under-recovery in Parbati-II and similarly, if you calculate the total AFC of Subansiri Lower also, there also we have Rs. 150 Crore kind of under-recovery. So, altogether Parbati-II and Subansiri Lower, Rs. 450 Crore of revenue has not been booked in our book of accounts if you look at the tariff petition filed in respect of these two projects.
What has been the impact of Teesta-V this year? When do we expect that project to restart?
So, there is no revenue, only expenditure has been there in Teesta-V. So, there is nothing top-line contribution from Teesta-V, but going forward, we are very much sure that June onwards, we are going to have operation to get resumed in respect of Teesta-V. So, by end of June onwards, you can see some top-line activity in Teesta-V also. In respect of Teesta-V, we have total AFC of around Rs. 500 Crore. So, if you exclude the tax element, it would be around Rs. 400 Crore.
When you talk about Rs. 1,600 Crore revenue for Parbati-II, is it reasonable to say that the Rs. 150 Crore loss for FY'26 would have been about Rs. 150 Crore profit? Also, on Subansiri Lower at 80% revenue, given only part commissioned capacity, are you booking whole revenue for early units?
Exactly, you have explained very correctly. So, that includes Rs. 200 Crore as well. The revenue which we have recognized to Parbati-II is Rs. 1,320 Crore. The design energy of Parbati-II is 3,125 million units, whereas we have actually generated 1,642 million units in FY'26. If your generation is not there, you have not been able to book the entire expected revenue of Parbati-II. That is the reason you have not achieved the expected PAT level of Parbati-II. For Subansiri Lower, we have shared that 80% of the revenue we have recognized i.e. around Rs. 613 Crore only. Total revenue against the 506 million units is Rs. 613 Crore only. That is 80% of the expected AFC. If you gross it up, you will find Rs. 150 Crore under-recovery in Subansiri Lower also.
Are you seeing any slowdown in renewable tendering this year and any improvement on the 40 GW PPA signing backlog?
So, we have not done any tendering in recent past. Whatever tendering we had made, we have already awarded around 23 GW kind of capacity, out of which 13 GW kind of likely PPA and PSA signing we are hoping, out of which 7 GW approx. we have already signed. So, going forward, we will again have more clarity in months to come in respect of REIA projects also.
Are you expecting any slowdown in generation given this is an El Nino year with expectations of weaker monsoon?
No. As you are aware, you have been tracking NHPC for years, most of our power stations are snow-fed. So, certainly good monsoon will be helping us for better generation but our generation currently also is going fairly well.
What is the normative PAF of your plants?
Consolidated it is 82%, standalone it is 80%. There are two things. If you look at the actual PAF with Teesta-V, it is certainly lower, 75%. But if you exclude Teesta-V, it is 80%. So, Teesta-V has not contributed anything during the last fiscal as well as the corresponding fiscal. In both the fiscal, if you exclude Teesta-V, you will get 80% kind of PAF. But, if you include Teesta-V, certainly it is 75%.
What will be our equity value (regulated equity) for next year and the next couple of years?
Current regulated equity, including Parbati-II, is Rs. 18,309 Crore. In next financial year, if you consider the capacity addition, we are having capacity addition of 1,250 MW of Subansiri, out of which 250 MW we have already commissioned. So, balance 1,000 MW would be coming from Subansiri, then we have 120 MW Rangit-IV, then 1,000 MW Pakal Dul, 624 MW Kiru. So, all these hydro assets, we are going to commission 2,994 MW in FY' 27. Apart from that, we have 1,190 MW of solar assets also, which are going to be commissioned in the current fiscal. So, altogether, if you look at the hydro regulated equity by end of FY'27, it would be Rs. 30,672 Crore.
What kind of construction cost increase are we seeing? Do we have a methodology to pass on the cost?
As far as this increase in construction cost is concerned, this being a cost plus, everything is allowed by CERC. Once it is beyond our control, things are all passed on. So, there is no such concern as far as this is concerned. We are having checks and balances regarding how the cost can be kept in check. Just because of certain reasons beyond our control, like geological surprises, sometimes there are design changes and other events happen in the project site, definitely, there are some increase. In any case, all those increases are taken care of as per the regulations. Whatever cost beyond our control, that is definitely allowed by the CERC. So, we do not have any issues on that front.
What is the reason for a negative regulated income for this quarter?
That is basically, as we have discussed, in our opening remark, there has been reversal of Rs. 1,156 Crore of DTL in the line item of deferred tax liability. So, similar kind of reversal we have to make under rate regulated asset also. That has been reflected under regulated deferral account. That impact is there basically. This we have disclosed in note #8 of our financial results. That is taking care of this concern.
With Subansiri, Parbati and Teesta-V coming back, what is the kind of volume number for next year?
So, as of now, four units have already been commissioned. The design energy of this project is 7,421 million units. Going forward, more four units are coming in a phased manner. If you look at the expected generation of Subansiri Lower, we are expecting somewhere 5,000 million units to 5,500 million units of generation from Subansiri Lower. We have seen generation of 506 million units in Subansiri Lower during the last fiscal.
Timeline for CERC tariffs for Parbati and Subansiri — from when can we see revenue recognition at 100%?
Akash, as I already explained, Parbati-II petition is in the final stage of hearing and we are expecting an order from CERC by 30th of June. As far as recognition is concerned, in case the order comes within a quarter, then we will definitely account for the differential revenue along with interest component also, because the interest is allowed from the date of COD. In that case, we will completely be billing, part billing will be over and we will be recognizing the revenue in this quarter itself if the order comes. As far as recognition is concerned, there is no deferral. For Subansiri, we have already filed the petition for our interim tariff. So, first, we are just waiting how much interim tariff CERC is going to allow us and thereafter, in subsequent hearings, like in case of Parbati-II, after interim we are expecting that within three to four months. But in case of Subansiri, as this is a very old project, so we expect that not more than six months CERC will take to issue the final order.
Are any future projects facing material changes in cost — Pakal Dul, Kiru, or any other?
Akash, cost escalation in hydro projects are very inherent. You cannot rule out. Even though if there is no time overrun, there will be cost overrun. Because when we award at a particular price level, that award cost is not freezed. That is basically at a particular price level. So, if you are going forward with that award for four, five, six years, we have to pay the price variation. So, cost overrun is very inherent in any hydropower project. Not material because projects like Pakal Dul, Kiru, Kwar are doing pretty well and whatever timeline we have shared with you, we are going to commission these projects by that timeline. So, nothing extraordinary you will find there.
What led to profit for Subansiri in the quarter given lower PAF and generation, and billing at lower tariff? Did you book shortfall in generation in Subansiri also?
No. Mohit, we need to understand that whatever AFC of any project we file, that is basically based on the capital cost of the project. If we are going to the CERC with the original cost of the project without any deduction and then whatever expected AFC is there from that particular project, 506 million units of generation we have from Subansiri in the last fiscal, so their income has been booked corresponding to the capital cost of these units which we have commissioned. If you are taking the entire capital cost of those units, for example, if we have commissioned three units of Subansiri, their corresponding capital cost is coming around Rs, 20,000-odd Crore. If you take tariff based on Rs. 20,000 Crore of capital cost and if you multiply the number of units generated, then certainly this is the top line, and apart from that, whatever actual expenditure has been there, after that you are going to have profit.
Why shortfall in generation has been booked in Parbati-II? Are you going to argue for lower design energy? Is this allowed in regulation?
Mohit, basically, shortfall in generation, regulation allows us. In case we are not able to achieve design energy and the reasons for non-achievement are beyond our control, in that case, CERC regulation allows us even to bill. So, in that case, we are having order of interim tariff of 75%. We are going to bill that too at the rate of 75% of the tariff filed. So, this is as per regulation what we are doing. There is no issue. We are going to bill and get it from the beneficiaries. No, it is too early to argue for the lower design energy. Parbati has seen only one year and you have seen that some cloudburst issue and everything had incurred there in Parbati-II just one year back, early monsoon. For challenging the design energy, you have to wait for at least three years.
Why is TLDP-III and TLDP-IV showing lower PAF in the quarter?
If you remember October'23 events where we got heavy damages in Teesta-V, these flash floods had impacted our TLDP-III and TLDP-IV projects also. A lot of silt issues are there, which we are trying to come out of. Last year also, we had carried out some process to remove the silt and all, but again it has accumulated. Those issues we are now basically facing and hopefully, we will be able to come out of these issues within three months I believe.
Which power plants are you likely to tender in this fiscal — Sawalkot, Kamala, Subansiri Upper, Etalin?
Actually, we have a target to bring five projects of hydro bring into construction stage during this financial year. Two have already been awarded, Uri-I Stage-II and Dulhasti Stage-II. Three more projects like Etalin, Sawalkot and Kamala are also likely to be brought into the construction stage during this financial year. One more PSP also, we are targeting to bring into the construction stage which is Indira Sagar-Omkareshwar. Subansiri Upper, we may not be going this year. Next year, we may be going for that.