Citigroup puts 'Sell' on Adani Power
According to the company , the plant is running exclusively on Indonesian coal currently and fuel cost is expected to come off in Q4FY10
By ET Bureau |
RESEARCH: CITIGROUP
RATING: SELL
CMP: RS 100
In Q3FY10 Adani Power generated 670 million KWh at a plant load factor (PLF) of 92.8%, significantly higher than the 37.7% in Q2FY10 as the plant stabilised. Adani Power’s fuel cost/unit of generation at Rs 1.45/kWh was ahead of Citigroup’s expectation of Rs 1.03/kWh as the company initially imported expensive South African coal and blended the same with cheaper Indonesian (Bunyu) coal.
According to the company , the plant is running exclusively on Indonesian coal currently and fuel cost is expected to come off in Q4FY10. According to the management Units 2, 3 & 4 of Mundra Phase I & II are delayed by two-three months due to restrictions on Chinese visas. However, Phases 3 & 4 are on schedule.
According to the management, the taxes shown in the profit and loss statement are deferred taxes. The company has so far not started to avail the 10-year tax holiday under section 80IB and will start the same once all units are commissioned.
RATING: SELL
CMP: RS 100
In Q3FY10 Adani Power generated 670 million KWh at a plant load factor (PLF) of 92.8%, significantly higher than the 37.7% in Q2FY10 as the plant stabilised. Adani Power’s fuel cost/unit of generation at Rs 1.45/kWh was ahead of Citigroup’s expectation of Rs 1.03/kWh as the company initially imported expensive South African coal and blended the same with cheaper Indonesian (Bunyu) coal.
According to the company , the plant is running exclusively on Indonesian coal currently and fuel cost is expected to come off in Q4FY10. According to the management Units 2, 3 & 4 of Mundra Phase I & II are delayed by two-three months due to restrictions on Chinese visas. However, Phases 3 & 4 are on schedule.
According to the management, the taxes shown in the profit and loss statement are deferred taxes. The company has so far not started to avail the 10-year tax holiday under section 80IB and will start the same once all units are commissioned.
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