As coal and gas supply crisis deepens for the power industry, other companies have no choice than to go running to merchant corporates to meet their demand for power.
This translates to additional profits for the merchants as they sell power not only at a premium, but the rates are also bound to go up further. Speaking to CNBC-TV18 from the boardroom, Sushil Maroo, director-- finance of Jindal Steel and Power ( JSPL ) says that he expects merchant power rate to stabilise at Rs 4-4.25 per unit going ahead. Average price of power has been at Rs 3.7 per unit over the past six months.
He however says that this hike in power tariff by merchant organizations is going to be a temporary phenomenon. “We don’t expect to benefit much from merchant power rate hikes,” he says.
Below is the edited transcript of Maroo's interview with CNBC-TV18. Also watch the accompanying video.
Q: Can you tell us how things are panning out for the second half? What JSPL remains confident of doing in terms of revenues and profits by the time you are done with the year?
A: The second half is generally good and the second half should be still good. This is because power plants will do good, steel production will rise and steel prices will remain firm. In the first half, the second quarter is a rainy season quarter but the second half normally is better and good than the first half. This is a normal trend and would be repeated this year too.
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This translates to additional profits for the merchants as they sell power not only at a premium, but the rates are also bound to go up further. Speaking to CNBC-TV18 from the boardroom, Sushil Maroo, director-- finance of Jindal Steel and Power ( JSPL ) says that he expects merchant power rate to stabilise at Rs 4-4.25 per unit going ahead. Average price of power has been at Rs 3.7 per unit over the past six months.
He however says that this hike in power tariff by merchant organizations is going to be a temporary phenomenon. “We don’t expect to benefit much from merchant power rate hikes,” he says.
Below is the edited transcript of Maroo's interview with CNBC-TV18. Also watch the accompanying video.
Q: Can you tell us how things are panning out for the second half? What JSPL remains confident of doing in terms of revenues and profits by the time you are done with the year?
A: The second half is generally good and the second half should be still good. This is because power plants will do good, steel production will rise and steel prices will remain firm. In the first half, the second quarter is a rainy season quarter but the second half normally is better and good than the first half. This is a normal trend and would be repeated this year too.
....more info