Reliance Power
BSE: 532939 | NSE: RPOWER | ISIN: INE614G01033 | Power - Generation/Distribution
- Directors Report
- Chairman's Speech
- Auditors Report
- Notes To Accounts
- Accounting Policy
- Finished Products
- Raw Materials
| Chairman's Speech | Year : Mar '09 |
My dear fellow shareowners,
It gives me great pleasure to share with you the highlights of our
Company’s achievements in FY 2008-09. During the year, our Company made
significant progress in fulfilling its vision of becoming the largest
and the fastest growing private sector power utility in the country.
We reached key milestones, including the financial closure of the Sasan
Ultra Mega Power Project. We won the Tilaiya Ultra Mega Power Project
in addition to hydro power projects in Arunachal Pradesh. We also made
excellent progress towards the execution of Rosa Power Plant ahead of
schedule.
The installation of a stable government at the Centre is a huge
positive development, which is likely to usher in long pending reforms
that are required to keep the economy on a high-growth trajectory.
Key Developments
Financial Closures
As you are aware, our Company has embarked upon a capacity addition
programme in generation that is unparalleled in the history of the
Indian Power Sector. We plan to add over 30,000 MW in the next 7-8
years. Since financing these projects will entail significant amounts
of debt, achieving timely financial closures is of utmost importance.
It is therefore a matter of pride that we were able to secure the
largest ever debt on non-recourse project finance basis across any
industry in India for the Sasan Ultra Mega Power Project at a time when
the External Debt Market had gone completely dry and the domestic
lenders had turned ultra-cautious, thanks to the unfolding global
credit crisis.
The Sasan closure also represents the first ever appraisal of an
integrated coal mine cum power project of this scale on project finance
basis in the country. We were also successful in getting our appraisals
completed for the 600-MW expansion at Rosa and the 300-MW at Butibori.
In addition, we obtained part sanction for the Krishnapatnam Ultra Mega
Power Project. In all, we were able to get appraisals done or obtain
sanctions for project with an investment outlay of more than Rs 40,000
crore (US$ 8 billion).
Progress on Project Execution
Given our large generation portfolio, it is imperative that we focus
our attention on ensuring that we implement all our projects on time
and at costs which are lower than our initial estimates. Indeed, we are
committed to setting new benchmarks in project costs and time
schedules. The Rosa Power Plant, located in Uttar Pradesh, is currently
ahead of schedule and we expect it to be operational before the end of
FY 2009-10. In 2011, we expect to commission the expansion units at
Rosa and the upcoming plants at Butibori.
We have also advanced, by almost three years, the schedule for the
commissioning of the first Ultra Mega Power Project at Sasan. We hope
to commission two units of 660 MW each at Sasan before the end of FY
2011-12.
We are well aware of the complex challenges that lie in the way of
successful execution of power projects. But given our traditional
strength in project management and the experience of our execution
teams, we remain confident of successfully overcoming any odds.
New Projects
The power sector in India continues to offer exciting new
opportunities. During the year, we won, through a competitive bidding
process, the right to develop the 3,960 MW Tilaiya Ultra Mega Power
Project located in the State of Jharkhand. Aside from the significant
synergies that it has with other power projects that we are developing,
Tilaiya also presents the added advantage of having captive coal mines
allocated for it.
While coal-based power projects provide large headroom for growth, we
are equally confident about the benefits and advantages that would
accrue from having hydro power projects in our portfolio. We have
therefore keenly participated in the bids for such projects and have
recently been awarded four more hydro power projects for development in
the state of Arunachal Pradesh. With this, the total hydro capacity in
our portfolio has gone up to 4,620 MW, while our aggregate portfolio
now stands at more than 33,000 MW.
Securing Fuel tie-ups
Fuel availability and its pricing continue to be one of the biggest
challenges for power projects in India. While we have plenty of coal
reserves in the country, the development of mines has not kept pace
with our ambitious programme for the addition of generation capacities.
We have therefore made it a conscious part of our strategy to ensure
that a major portion of our coal-based generation portfolio is
supported by captive mines.
The proposed Ultra Mega Power Project at Tilaiya has given us the right
to develop coal mines with estimated reserves of almost one billion
metric tonnes. Potentially this makes us one of the largest coal mining
companies in the country with nearly 2 billion tonnes of aggregate
reserves.
Performance review
The salient points of company’s financial performance are
- Total income of Rs 334.72 crore as compared to Rs 132.87 crore in the
previous year.
- Net profit of Rs 248.90 crore as compared to Rs 94.67 crore in the
previous year.
- Earnings per share (EPS) of Rs 1.04 as compared to Re 0.17 in the
previous year.
Corporate governance
During the year under review, a series of unfortunate disclosures
brought the spotlight back on governance practices in Corporate India
and jolted investors in India and across the world.
We remain committed to maintaining the highest standards of corporate
governance and would continue to work in a transparent and professional
manner for creating value for all stakeholders.
There is nothing we value more highly than the trust of our 3.8 million
shareholders, the largest such family in the world. And we will do all
we can to preserve, protect and enhance it.
Social Commitments
Our company is setting up power projects across the length and breadth
of the country. These projects entail the acquisition of significant
amounts of land which, in some cases, might come from people who have
to be rehabilitated and resettled. We are committed to adopting
Rehabilitation & Resettlement (R&R) policies which go beyond the norms
set out by the Government. Our intention is to ensure that we meet the
development needs of the local community wherever we are setting up our
projects.
Our commitment
Our Company takes pride in being a part of the Reliance Anil Dhirubhai
Ambani Group, which ranks among India’s top business houses. This
association would continue to shape our vision and values.
At Reliance Power, we believe in maximizing shareholders value, and in
benchmarking ourselves to the best global standards. We make every
effort to ensure that our projects are based on cutting-edge
technologies, and are executed at speeds and costs which are unmatched
in the industry
The last financial year was a landmark year in our endeavour to take
over the mantle of leadership among India’s private sector power
players. The year ahead will be, if anything, even more critical.
As ever, I seek your whole-hearted support and encouragement in this
exciting journey.
Anil D Ambani
Chairman |
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| Source : Religare Technova | |
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