NHPC Q3 profit seen down 10.5% to Rs 190 cr

State-owned NHPC is set to declare its results for the third quarter of financial year 2012-13 on Tuesday. Analysts on an average expect profit after tax of the company to fall by 10.5 percent year-on-year to Rs 190 crore in the quarter, according to CNBC-TV18 poll.

Net sales are seen going up by 4.4 percent to Rs 921 crore from Rs 882 crore during the same period. Earnings before interest, tax, depreciation and amortisation (EBITDA) are likely to rise by 3.5 percent YoY to Rs 392 crore while EBITDA margin is seen falling 40 basis points YoY to 42.6 percent in the October-December quarter. The October-December is seasonally a weak quarter; hence, decline in generation is expected to weigh on earnings. Gross generation for Q3 declined 10 percent YoY to 2.64 billion units driven by poor river flow and reservoir levels. Generation from the Dulhasti, Chamera-I, Dhauliganga, Salal & Teesta V plants have fallen due to lower flow of river. However, higher plant availability index of 83 percent in the third quarter of FY13 (as against 76 percent in Q3FY12) should help salvage negative impact of lower generation. According to analysts, interest on water cess (around Rs 130 crore) might be recognised in the December quarter, which could lead to significantly better results. Investors should watch out for availability & reason for generation decline; commissioning status for balance projects targeted in FY13 + any downward revision in capacity addition guidance; outstanding debtors position; and status of dispute with J&K government. In July-September quarter, NHPC's net profit fell by 19 percent YoY to Rs 783 crore as weak monsoon affected generation negatively. Operating profit margin dropped by 360 basis points YoY to 67.9 percent.