Top Indian Companies: Power Grid Corporation of India Ltd

Power Grid Corporation of India Limited is a PSU company under Ministry of Power and is headquartered in Gurugram.

It is engaged mainly in transmission of bulk power across different states of India.

Power Grid transmits about 50% of the total power generated in India on its transmission network. It is a Nifty 50 company with a weightage of 0.96% on the index.

Business

Power Grid operates throughout India and covers 90% of country's interstate and inter-regional electric power transmission system and its business segments include Transmission, Consultancy, Telecom and ULDC/ RLDC.

Its transmission network consists of roughly 168,140 circuit kilometers and 252 EHVAC and HVDC substations, with total transformation capacity of 422,430 MVA as on 31 January 2021, and an availability of over 99%.

Power Grid's interregional capacity is 75,050 MW. Examples of Power Grid-owned stations include the Vizag back-to-back HVDC converter station, the Chandrapur back-to-back HVDC converter station, the India Sri Lanka HVDC Interconnection, and the Talcher–Kolar HVDC system.

Shareholding Pattern

The Shareholding Pattern page of Power Grid Corporation of India Ltd. presents the Promoter's holding, FII's holding, DII's Holding, and Share holding by general public etc.

Holder's Name No of Shares % Share Holding

No of Shares 6975452864 100%

Promoters 3581163210 51.34%

Foreign Institutions 1966511767 28.19%

Banks Mutual Funds 575614703 8.25%

Others 650033990 9.32%

General Public 190699995 2.73%

Financial Institutions 11429199 0.16%

FY2023 Q4 and Full Year Results

Power Grid Corporation on Friday posted a nearly four per cent rise in consolidated net profit at Rs 4,320.43 crore in the March 2023 quarter, mainly on the back of higher revenues.

The company had reported a consolidated net profit of Rs 4,156.44 crore in the year-ago period, according to a BSE filing.

The total income in the quarter under review increased to Rs 12,557.44 crore from Rs 11,067.94 crore a year ago.

In the financial year 2022-23, the consolidated net profit declined to Rs 15,417.12 crore from Rs 16,824.07 crore in FY22.

The total income rose to Rs 46,605.64 crore in 2022-23 from Rs 42,697.90 crore in 2021-22.

The company's board, in its meeting held on Friday, has recommended a final dividend of Rs 4.75 per share for the financial year 2022-23.

This final dividend is in addition to the first interim dividend of Rs 5 per share and the second interim dividend of Rs 5 per share for the financial year 2022-23.

In a statement, the company stated that it has proposed a final dividend of 47.50 per cent (Rs 4.75 per share on a face value of Rs 10 each) in addition to the first and second interim dividend of Rs 10 per share already paid for the FY23.

The total dividend for the year thus amounts to Rs 14.75 per share, which is the same as that for the previous year.

The company incurred a capital expenditure of Rs 9,212 crore and capitalised assets worth Rs 7,413 crore (excluding FERV) on a consolidated basis during the financial year.

Its Gross Fixed Assets on a consolidated basis stood at Rs 2,70,107 crore as on March 31, 2023, against Rs 2,62,726 crore as on March 31, 2022.

In FY23, it along with its subsidiaries added 24,900 MVA transformation capacity, 7 sub-stations and 1,676 ckm (circuit km) transmission lines.

Powergrid has successfully commissioned its 4 TBCB subsidiaries i.e. Powergrid Rampur Sambhal Transmission Limited, Powergrid Bhind Guna Transmission Limited, Powergrid Medinipur-Jeerat Transmission Limited and Powergrid Bhuj Transmission Limited.

As of March 31, 2023, the total transmission assets of Powergrid and its subsidiaries stood at 1,74,110 ckm of transmission lines, 272 sub-stations and 4,99,360 MVA of transformation capacity.

During the year, it has acquired one Intra State Transmission System and eleven Inter State Transmission System TBCB subsidiaries with an estimated cost of approx Rs 9,500 crore.

The company continued to maintain high average transmission system availability of over 99.80 per cent in FY23 also.

The average transmission system availability in FY23 was 99.82 per cent.

Powergrid has been ranked in the first quadrant for both Line and Substation Maintenance in the International Transmission Operation and Maintenance Study (ITOMS) for 2021-22.

Ranking in the first quadrant is indicative of asset maintenance being carried out at a low cost with high-performance levels.

In another BSE filing the company stated that 'Committee of Directors on Investment on Projects' of Powergrid in its meeting held on May 19, 2023, has accorded investment approval for 'Capital Expenditure for procurement of Customer Premises Equipment (CPE) for augmentation of Telecom Access network for providing connectivity to new customers at an estimated cost of Rs 258.70 crore with a commissioning schedule of 24 months from the date of award.

Brokerage Outlook

Strong project execution capabilities, given the work-in-hand, improved Balance Sheet and continuously increasing share of renewable energy portfolio, company’s outlook remains promising over the long term.

However, rising fuel costs is likely to impact profitability in the short term. Brokerage, Geojit, remain cautious and hereby downgrade our rating to HOLD on the stock with a rolled forward TP of Rs. 204 based on 1.5x FY24E BVPS.

ESG and Sustainability

POWERGRID is fully conscious of the need to conserve natural resources and avoids ecological sensitive area, eco-sensitive zones, forest, sanctuaries, national parks, tiger/biosphere reserves and CRZ covered coastal areas to the extent possible.

POWERGRID has already taken initiatives for conservation of land for both transmission lines and substations by adopting various technological measures.