Tata Power hopes to fund its future projects from internal accruals and debt, managing director and chief executive officer Praveer Sinha told Moneycontrol in an interview.
Tata Power has an ambitious plan to invest Rs 60,000 crore over four years. Of this, it plans to invest Rs 20,000 crore in the current fiscal against Rs 12,000 crore a year ago.
“In the last four years, we have already invested Rs 40,000 crores…This financial year, we have a target to invest nearly Rs 20,000 crores, out of which, nearly 50 percent is in the renewable business. The balance, of course, gets divided between our generation of hydro plants where the pump hydro will start the construction activity,” Sinha said.
He added the company’s debt-to-equity ratio has reduced over the past four years from 2.5 to the current 1.1.
“We are generating good EBITDA. To a large extent, we will repay our old debt and also fund the capex. We will continue to take some new debt for new investments,” said Sinha.
EBITDA is short for earnings before interest, taxes, depreciation, and amortisation,
The CEO said he expects power demand in India to go up this year amid a pick-up in industrial and commercial activity and also due to heatwave.
Tata Power on May 8 reported a consolidated net profit of Rs 1,045.59 crore for the March quarter of FY24, growing 11.37 percent from the year-ago period on the strong performance of its core thermal coal generation business.
Sequentially, net profit remained flat. The company reported a profit of Rs 1,076 crore in the December quarter.
The company’s revenue was up 27 percent at Rs 15,846.50. EBITDA jumped eight percent to Rs 3,358 crore from the year-ago period.
At the end of FY24, the company had 4.5 gigawatts (GW) of renewable capacity operational. Another 5.5 GW of projects are being implemented, taking the Tata group firm’s green energy portfolio to above 10 GW.
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