Tata Power Company Limited (TATAPOWER) Q1 2027 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to the Tata Power Q1-FI27 Koenig's conference call. As a reminder, all participant lines will be in the listener remote and there will be an opportunity to ask questions after the presentation concludes. Should you need assistance, bring the conference call, please signal an operator by pressing star, then zero on your touch-tone phone. Please note this conference is being recorded. Thank you.

Thank you very much. Good morning, everyone, and thanks for joining us over the call. We normally do after the quarter results around 6 o'clock, but this time I was told that all of you are tied up in another event, and that's why we thought we'll do it. Thank you all for joining. I am joined by my colleagues, Sanjeev Juriwala, he is the CFO, Rajesh Daga, Group Financial Controller, Kakhuri Sondarajan, Chief Treasury, Anshul Vadia, and all my other colleagues who are here from the Finance Department. Before I delve into the quarter performance, let me share with you some information on the power sector. The demand growth has been very strong in the first quarter. It was nearly 8.5% increase. In fact, in the month of May, it was nearly 11% and June was 9.8%. We continue to see similar demand in this month also. July has been consistently in the range of 260 to 270 gigawatts. Rains have been delayed, and wherever it has happened, it has been very inadequate. So I think we can expect a longish summer this year, and with very little of rain in most of the parts of the country, which is leading to cooling requirement, and that's why you We also see a large increase in consumption of power. We also see that going forward there will be a large increase in demand because it's not only the cooling but also industrial growth has picked up and there is good demand in the industrial sector. So I think it's It's good for the power sector, especially with the type of investment and capacity, and that is taking place all over the country. Moving to the financial performance of the company, Tata Park has done exceedingly well, 1,401 crore of that in the quarter, which is an 11% increase. And so also the EBITDA increase has been 8% to 4 to 9, and also we have shown increase in revenue. But what is important is, and I thought that this time I will take the opportunity to share with you that this is not a one-off sort of thing. This is the 27th conjunctive quarter where we have seen increase in our PAT and EBITDA, and that is because there's a very strong foundation of our existing operations and new businesses that are getting added. In fact, I was looking at some of the numbers, and we have shared with you in slide 19 to 21 that how over a period of time, if we compare whether it was the Q1 by 24 or 25 or 26, we have consistently every year shown increase in revenue, increase in EBITDA, and increase in PACT. In fact, the CAGR in revenue is 8%, EBITDA is 12%, and PAT is 7%. And this, again, if we break into different components, you will see that we have done exceedingly well. Let's look at the transmission business, how it has performed again in last four years each quarter. It has done, again, you will see that the transmission business per se has shown a revenue increase of 45% CAGR, 19% in EBITDA, and 27% in FAT. Mumbai transmission itself has shown 7% CAGR in revenue, 11% in EBITDA, and 21% in FAT. And this will continue because we have a huge pipeline of investment, which is there in Mumbai transmission, nearly 10,000 crores of investment will happen in the next five years. And this is on regulated basis. So we not only get deregulated, but also certain upsides because of better performance of efficiency and availability of this transmission system. Similarly, on our TBCB projects, which are getting implemented, some are now in the final stages of completion. One will get completed, the Agra-Khorja line, in the next few days. The other one, the Pika-Ner-Nemrana line, will also get commissioned by October. So again, huge pipeline of projects, and you will see the benefits of that accruing in the subsequent quarters. Let's look at our distribution business. Again, consistently we have done very good. If we look at the total distribution business, the revenue has gone up, the EBITDA has gone up, and so also the PAT has gone up, and this we are seeing consistent performance. And typically in distribution business, Q1 is not the best of the quarter Because of the huge challenges which one has, especially in summer months in terms of bidding and selection. But I think what is important is that how consistently even in quarter one we have been showing an improvement in all these parameters. Similarly, if we see our renewable cluster, it has done exceedingly well on an overall basis. The revenue has gone up by 22%, the EBITDA by 23%, and the PAT by 37%. But it's important that when we talk of revenue, of renewable cluster, we also go and see where exactly this benefit is coming from. The generation business, we have seen revenue grow by 11% on the CAGR basis, EBITDA by 10%, and PAT by 2%. And mind you, we have not been setting up large number of projects because we were tied up in doing third party. Now, this year, we will set up 2.5 gigawatt, 2,500 to 2,700. Already, 200 was commissioned to 30, and another 500 will get commissioned in the next few weeks. The delay was not from our side. We were ready on 30th June. We had done all the testing. The transmission system got delayed, and now that has been commissioned, one of them, and the testing is going for commissioning our plant, and the balance will happen by I think you will see huge capacity add in the renewable and its impact. Right now, we are at 6.7, we add 2.5, we will cross 9 gigawatt by the end of this financial year, and the impact of it will start being seen in the subsequent quarter as also in FY28. Rooftop business has done exceedingly well. Our revenue has grown from last year to this year by nearly 100%. Our CAGR of four years is nearly 58%. Our EBITDA has grown by nearly 50%. And our profit has also grown by more than 60% in the last one year. On a CAGR basis, it is 84%. So again, and rooftop business will continue. In fact, every year we have seen, in fact, the rooftop business doing exceedingly well. In fact, last year we grew by 100%. And this year also we have plans to go by about 60 to 70%. And that's the type of demand which is there for us in the market and the channel partners and And the supply chain that we have tied up, and the IT systems which support an after-sales service. So I think the rooftop business, again, you will see huge improvement in this year. And now that we have added to rooftop battery storage, especially for residential and industrial purpose, you will see the impact of that also coming and the combined solution. Again, on manufacturing, we started two years back. The cell and module plant are now operating at full capacity. For the first time, our module plant recrossed 1,000 megawatt in water, and we expect that we are virtually peaked over there or peaking over there in terms of our module production. Our cell production is still catching up, and we have seen that how in last three years, last two years, our revenue, EBITDA, and FAT has been a lot back, and that has been back of many steps that we have been taking to improve the eating efficiency, And also the manufacturing cost of all the cell and modules. And a lot of engineering goes in all these things. So what I wanted to share with you is that we are in a very good position of doing consistently good performance quarter on quarter. And this is not a one-off, this is not something that has happened just for one quarter, but has been happening right across the last many years. And this trend will only keep on improving. So, typically, we see that the first quarter, by the end of the year, it is not just multiplied by four, but sometimes it is more like 4.5 to five times improvement. We will see at the end of the year, and that's what we are expecting this year also. Coming to some of the other areas, Mundra, we have concluded with Gujarat. The plant is operating, though it is operating under Section 11 for the purpose of scheduling, the tax we are charging the procurers as per the SPPA. We are in very advanced stage of getting approval from three states, expecting that in the month of August, we should have the cabinet approval for some three states, and the fourth state will happen in September. All of the procurers are taking full capacity from the plant, and they are 100% convinced that this is the most sustainable plant in the long run in terms of its tariff and in terms of merit order. And we are very confident that we will run this plant continuously now up to 2038 and some of the newer businesses especially on the pumped hydro and hydro, very good progress in the pumped hydro project. We are doing very good construction work over there and we expect that beginning of calendar year 29, we will be in a position to commission the plant and And since there are three units, they will get commission with a gap of two months for each unit. We have been fortunate to win a bid through SECI, which is a very attractive tariff, and for one unit of 330 megawatts. And for the balance, too, we are in discussions with Tata Steel and other procurers to supply to them. As also, we are expecting now new bids to come from NGPC and others, NHPC, NGPC, of Conthydro. So, we will start work on the 1800 megawatt in the later part of this year. We are in the process of getting all the approvals, and once we have the approvals in place, we will take the approval of the board and go ahead and start the construction activity on that. We have also tied up the PTA for 600 megawatt of Hutan project with the PTA has been signed with them, and it has got the regulatory approval. Again, it meets the return that we had planned, in fact, better than that. And we do expect that this plant will also become operational in the calendar year 2030. We expect to start work on the 1125 growth drilling project where World Bank is financing and we are in the process of completing the financial growth in the next two months' time with PFC, IFC and some of the other lenders. So, I think we have very good pipeline of projects, a very stable portfolio of projects, and all these projects are under implementation, and we do expect we will be in a position to implement all of them within the cost and within the timelines that we have set for our term. And these are long-term projects. We found hydro and hydro projects. We are talking of 35, 40 years of TPA. And what is good is that these are being done in areas that is known to us. So, I'm very confident that these will become very big and good assets for the Tata Power going forward, like many of the existing assets which have been there for many years, like the hydro plants, which are there for more than 110 years. On the capital expenditure, for the first time, we spent 5,300 crores in the first quarter, and we expect that the 25,000 crores that we have lined up for this year will be able to demand. 50% of that 25,000 will be for renewable projects where you have clear line of sight of the balance is divided between our FGT projects as well as the transmission and distribution projects, which are also in pipeline. So, all are known. It is not that we have to go to unknown areas and do the investment, and our confidence is very high that we'll implement this, and the returns will start coming to us thereafter. So, we understand that when you do such large investment, the leverage issues have to be good, our net debt to underlying EBITDA is 3.41, and our net debt to equity is 1.25. This is within the guardrails that we have set for ourselves for investment, and I think we will work within those guardrails. Great opportunity for us for doing many more projects, but as I informed you, we do it on a calibrated basis. We are looking at new opportunities, including nuclear, where a lot of preliminary work has happened. But I think once the rules are notified by the government, we'll be in a position to come up with a firm plan. But from our side, we are working on land and the geotechnical studies and water availability and things like that. So I think when you look at Dataparl, you need to look at it from the various businesses and how each one of them is contributing to the overall profitability and sustained performance over a period of time. So with that, I will take a pause and look forward to hear questions from you.

Thank you, sir. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handset while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Mohit Kumar with ICIC Securities. Please go ahead.

Yeah, thanks for the opportunity and good to see progress on various businesses. My first question is on the what explains the mutual growth in Odisha this quarter and can Can you just touch upon the fact that the Tata project continues to make losses, and the losses have got only widened in this quarter?

Yeah, so, Udisa, we had three issues in Udisa. One was that there were some government payments which were delayed, especially for Pantai Kiraj department, so for drinking water and the sea flight and others. And that was because the allocations from the state government and the central government got delayed. We expect to collect all of them in the same water. The second is because of acute heat wave, the government asked that no disconnect supply up to 15% and if payments are not made. That period is over and now we are collecting all the payments. the collection efficiency is completely in this quarter. Thirdly, typically in the summer months, there is a huge demand of power. And when you do the billing, there is a one month cycle which is there. So that we get built in the subsequent months. And we expect that in this quarter, many of that issue will be covered. So, in distribution, we should always look at 12 months rollover rather than seeing on a quarter to quarter basis because it is all dependent on the consumption based on the temperature and the pattern. So, you will see huge amount of improvement in Odisha Biscop. These are only timing issues, it has nothing to do with the business arrangement. On the Tata project, we are in the final stages of closing some of the legacy projects. We earlier used to have large number of legacy So, we have two legacy projects which were losing money and very few which were profitable projects. Now, most of the legacy projects which were losing money have got over. We are at something like just 10% of the legacy projects in last stage. Cost of correction takes place because of that reason. And you will find that possibly maybe one more quarter will have an impact on other projects. And then after we see the performance of Tata Power, Tata Projects improving in terms of their financial performance, and they have a very good pipeline of excellent projects, multi-names globally who have given them authors, and you will see a huge turnaround in the performance of Tata Projects.

I could also add to what spoke about RISA, so that we get the complete perspective. Because of the couple of reasons that Dr. Sinha mentioned, yes, the collection got deferred by a few months here and there. But on an operating perspective, I think the RISA discussed it excellently well, you'll find in the deck as well. We only form a reported fact perspective, we grew by 6%. More or less, what we also find is Quotone. And quarter one, our total million units sold in Orisa was about double digits, where the million units sold was about 10.4%, because it's possibly the hot summer. So I think in together the financial performance has been great. It is just from an operation side, some of the payments got delayed, but that's something that we'll recover in quarter two.

Understood. My second question, is it possible to quantify your losses due to curtailment in this quarter? And what do you make of the transmission bottlenecks for your projects? Are you seeing progress on the transmission project which can end the curtailment and also ensure that our RE projects get commission on time?

Yeah. So I think the first question, I think when we generally look around, including our project, there's been a general curtailment of roughly about 5%, and that we think is also the industry trained. But given that a lot of transmission lines and evacuation lines are in past population, we think that this settlement will settle in in the next few quarters. But yes, I think for the first quarter, generally, this has been an overall pain for the industry. On the RE perspective, I think we have made a good progress when it comes to land and connectivity that is there. As we speak, while in the first quarter, we have commissioned 226 of megawatt, But we already have a line of size for 500 megawatt where the physics is almost ready. We are just in the final phase that will happen in a week or two. So I think quarter two will see a huge and big ramp up in our commissioning.

Understood, sir. Thank you and all the listeners. Thank you.

The next question comes from the line of Sumit Kishore with Access Capital. Please go ahead.

Good morning. It was good to see the pickup in CapEx in Q1 and very useful slides in the financial highlight section this time to decipher the results. My first question is in relation to the renewable energy auction volume, which after peaking in FY25 came off in FY26. I mean, in your presentation on slide 12, the tower for Q1 FY27 is also trying a relative slowdown. So what is your outlook in terms of how renewable energy auction volumes and their complexion is likely to pan out in FY27 and maybe the medium term?

So, the variable options have been muted because, as you know, there were large number of PPAs which were tied up with the central agencies like SECI and NHPC and TPP. Those have not been tied up with the state governments. And now there is a growing awareness amongst states that they should do bidding themselves rather than having a central agency. Secondly, they now want the FDRE or RTC bids to happen and not just solar or even the hybrid that have been taking place. So, they are now coming up with much customized bids for the state's requirement rather than standard bids that used to take place at the central level. So, you will see that sort of, secondly, there are large number of projects which are coming up, like we are coming up with pump storage. So, I need a huge capacity first for pumping up water and second for bundling that power because I need to bundle that with the pumped hydro project. So, there will be a lot of similar type of investments that will come up, rather than the pure vanilla solar or green or even hybrid projects which were coming up by the central government agencies. Sure.

In relation to your pump storage hydro projects, would you look to tie them up into long-term contracts in terms of rupees, million per megawatt per month, or would you try to fashion something around feeding it renewable power and structuring it to sell on some bilater

So, it will be a mix of that. Right now, like for the 1,000 megawatts, there are three units of 334 megawatts. The first one we have tied up to big crosses on an entity base. And there are another tool which we are in discussion with the industries. So, one is with Tata Steel, the other is a number of other steel and So, I think we will see that it will be a mix and match, it will not be one single solution partly on direct basis, either to this and partly will be on bilateral basis with some of the C&I customers, the large C&I customers.

Got it. Just one last clarification. In your cluster-wise results when I look at TPCB projects line item, the EBITDA margin which is implied is just 13% for Q1 and FY27. Typically, TPCB projects, you know, should have much higher EBITDA margin given the asset profile and the depreciation that comes below the EBITDA line. What am I missing here?

So, yeah, it's a good observation, but I think the context is slightly different for us when we look at TGCV right now, all our TGCV are under construction, right? So the revenues in the PAC are more from a lease accounting perspective rather than the actual sharing of EBITDA. The actual EBITDA that comes to us is from a regulatory business, which is MO transmission, which is, again, a regulated business. So we'll have to look at it from a return perspective, and then we have a share of profit from some of the transmission assets that we have in the resurgence platform, so I think we'll have to look at it from that different perspective. Each of three cannot be put together in the same bucket. We can, if required, share separately with you to get the context.

Okay, so none of the TBCB projects is commissioned now and is contributing on a line-by-line basis as it would normally do.

Yeah, so you will start seeing that commissioning happening from quarter two onwards. So the revenues, two projects will get commissioned in next two, in quarter two and then next is quarter three, quarter four. So those revenues and the EBITDA, the TAD will start flowing in. As of now, you don't have the pure play EBITDA and TAD from TVCV. It's more about construction revenue booking.

Got it. Thank you so much.

Thank you. The next question comes from the line of Apoorva Bahadur with IIFL Capital. Please go ahead.

Hi, sir. Thank you for the opportunity. Sir, it's heartening to see the progress on pump storage. It would be great if we can share our plans for further capacity addition beyond this 2800 megawatts. I believe we had quite a few sites available.

Yeah, we have quite a few sites where we have the water reservoir. We are carrying out the DPR of some of those projects. I think in the next 12 months, we will come out with the next set of projects because we have these 2800 megawatts which is coming up in 29 and 31. First one, we want to have gaps for their implementation so that the implementation focus is there and we are able to execute these projects on that call.

Understood. We'll look forward to that. Secondly, sir, there was also this ALMM2 implementation and then rollback which happened during the quarter towards the end of it. So, how do you see this? I mean, does this have any impact on the realizations which DCR manufacturers were charging, given that there's a six-month delay now? And secondly, how does this policy sort of flip-top impact maybe industry's commitment towards investing in building out ingot and wafer capacity for A11-3?

So, it is not that there is a rollback. The ALMN 2 continues to be there for rooftop and utilities in progress. This is only special proviso which has been made for projects which have very limited open access arrangements or are behind the meters. So I would say that this whole thing is a very small component of the overall utilization which is, which has to be done under DCR. So it would be maybe 10% of the total requirement. So I think majority continues to be under the element 2 arrangement, and that is not actually, you know, moving the needle or having any impact as far as we are concerned.

Okay, so the commitment towards Ingold Wapers for us remains on track.

Yeah.

Okay. Sir, also when I see your rooftop business and you had shared a lot of granular data over there. So, for example, in this quarter, the revenue build and the total Wattpeak installed, right, if I calculate, I believe the realization is about 36, 37 rupees per Wattpeak. Now, when I compare that with the order inflow, on the same metric, it comes to around 28 rupees per watt peak. So how should we decipher this? Is this a decline in realization, or there's some of the nuance in accounting and billing that you're missing?

We think that they are implying a reduction in realization for root pop.

Well, could you just repeat your question? And Ribi, I think we are interpreting it differently.

Yes, yes. So the revenue we built for rooftop business this quarter was about $13.50 crores, and the megawatt installed was around $371. The order inflow, so that is about $36 per watt peak of realization. The order inflow which we have depicted in the slide is about $1091 crores and 387 megawatts. So that's about 28 rupees per watt peak. So is it just a change in realization or is it when we actually build an additional margin which is available which we're not capturing in the order inflow?

No, no, there are two parts of this. One is different places. So one kilowatt, we supply a large quantity under the ULA scheme of the government. So that's a different type of modules. Then you have other places where you supply for the higher capacity different modules. So we need to look at it whether they are 450 square mm modules or 580 or 630 and all that. So that's why the pricing difference you are seeing. So average will be very, very wrong interpretation of what sort of realization.

Okay, so there's a mixed impact, basically. Thank you. Yeah, absolutely. Understood, sir. Understood. Sir, also, if I may ask about the coal business profitability, we are seeing it has started improving due to the increase in international coal prices. Can you give us some sort of guidance on the trend that you're seeing in terms of Indonesian coal prices going ahead, given the on-off situation in Hormuz? And also about the change in export, coal export regime in Indonesia, if that has any impact on our ability to export all the prices.

One is that coal prices have gone up, but not very much. I would say about 5% to 7%. In that range, the coal prices increase. And we don't expect too much of changes happening, but yeah, it's up to 5% over the next nine months, you can expect it. Secondly, we do not expect or have seen any impacts per se. Of course, there are certain conditions that you need to first supply for domestic market. And after meeting domestic obligation, only you can export it. So those are the type of requirements. Fortunately, the KPC is the first one to have complied with that requirement. So we are not expecting any major changes to happen in the Indonesian cold market because of the new notifications.

Okay, so lastly, if I can ask about the breakdown for CAPEX in this quarter between, say, renewables, distribution business, and pump storage.

Almost 40 to 45 percent will be going in renewal. Yeah. And the remaining other businesses. Of course, the PSP, the work I've started, it'll only accelerate in the coming quarters. But yeah, you can presume in our quarter two also, we're kind of looking at the CapEx plan of probably higher than 6,000 crores. Maybe if everything goes well, it will be closer to 6,500 crores. Almost half of that will go in the new business because as we mentioned, they're trying to commission almost, you know, 8 to 900 megawatt in quarter two. So that will consume a lot of CapEx's. PSP work is also accelerating, will you put in there. Plus, we already have in the pipeline that 2,000 km plus of transmission. So, good pick amount of capital will also go over there.

Sure, sir, very helpful. And sir, our Mumbai transmission plan has been approved by the regulator? Yeah, yeah.

So, the whole lot of projects are under implementation. So, what happens is every year we get large number of approvals, And they keep on getting approved and getting implemented based on the timeline of the network.

Sure, sir. Thanks a lot.

All the best.

Thank you. Ladies and gentlemen, in order to ensure that the management is able to answer questions from all participants, please limit the questions to two per participant. The next question comes from the line of Satyadeep Chan with Ambit Capital. Please go ahead.

Hi, thank you. So, sir, I want to ask on rooftop. You've taken some strategic calls, including leaving the TSP untied, there's now being different from a higher realization. On rooftop specifically, you've been willing to try to understand this market has been growing at a very strong pace, consistently quarter on quarter for the past few quarters. Whereas, initially, it seemed like it was less than 3 kilowatt segment. Where are you seeing this growth? And I believe you, in annual reports, have been talking about 30,000 crores of rooftop revenue for you by 2030. I'm not sure if we read it correctly. But where do you see this rooftop going for you for industry? Because it has negative implications for some of the other businesses. It cannibalizes some of the other businesses. And so how do you see strategically this segment and how do you prepare for that if you have very volition rooftop?

In a rooftop, what we have done in the country as such is just 40 lakh consumers. India has 250 million consumers, 25 crore consumers. So, the market potential is humongous. And this is the product which is going to the poorest of the poor to take 1 kilowatt unit. And then it goes to others who take 2, 3, 5, 10, 20. And this is a phenomenal product in terms of giving independence to people to generate their power. And now that we are giving them battery also, so it makes them self-sufficient in terms of their power. The cost has come down, so it is also making economic sense. It is good for the environment. So, my feeling is that what we have given 30,000 is possibly little less. We have been growing at a very, very high pace, last year before last we were 2,300 crores, last year we did put 4,800. And this year you can imagine what sort of, so I think we will cross 30,000 crores, Thank you, everyone. And we had a comment. We have a workbook. We have developed the whole supply chain, channel, partners, after-sales service, the digital solutions that we provide. So no one can match us in this.

So if you look at quadrupling, so compared to mobile quadrupling, so basically what you're suggesting is by 29, 30, keeping batteries, I don't know batteries, what's going to be some component, but you're looking at 40 gigawatts, 30, 40 gigawatts of annual roof lock installation. Is that what, because that's how you get to, with your market share of 20%, is that kind of market is what you're foreseeing by 29, 30? Sorry, industry.

Yeah, I will also increase my market share from, well, 13%, I will become 25%. So I will be one of the biggest in the market, and by huge margin, in fact, the number two in the market is just 2%. And this is a cash and carry business. So I think we'll be one of the biggest. Two years back, I used to do 1,000 units a month. Now I do 30,000 units a month. So there's a huge change that has happened. And for doing that, the whole back-end process systems have been implemented. And so I think this will be a game changer going forward, not only for us, but also in the future.

And does it not bother you for, if let's say rooftop grows so phenomenally for the next few years for the country?

Please restrict yourself for two questions because we have few more people that have to.

Yes, sir, let's just follow up. Let's just follow up in this one on transmission that 2.5 giga, what kind of visibility do you have for transmission connectivity this year? But Rooftop, does it bother you about your distribution in IPT business if you see such phenomena, those are the questions?

So those are, in 10 years, those are certain changes which will happen in the market. So one has to be ready for those, but you will still require the distribution network, you will still require device, You will still require technology for managing multiple supplies and multiple usage of that power. So the nature of business will definitely undergo. You come and spend some time with me. I'll tell you what will happen in particular.

Thank you, sir. Mr. Satyadip, I would request you to please come back in the queue for further questions. Thanks. The next question comes from the line of Anuj Upadhyay with Investec. Please go ahead.

Hi, sir. Thanks for the opportunity and congrats on a good set of numbers. Sir, first one on the solar EPC side. So, I believe that the third-party EPC is no more a focus area, but it's the second quarter where we have posted a loss on an EBITDA level. Could you just explain, sir, why exactly at a loss at EBITDA level itself?

On the solar EPC, I think we have also mentioned last time that we would want to focus on our in-house execution plan. We already have 5.5 gigawatts in pipeline plus some of the solution along the ESP that is required. They put in a lot of amount of effort on that. So as a result, we have decided to repurpose our EPC workforce and EPC resources to in-house development. So we have discontinued with the EPC third party. So per se, last, previous year, we were doing some EPC work. We had about 100 odd crores of fat coming through that, but this year, we are kind of wrapping up some of the remaining work, and as a result, we have booked some losses. So the slide that you see 48 is a combination of solar rooftop plus solar EPC, take it out the EPC separately, EPC they have stopped. So now like-for-like basis, yes, from a previous base, usually remove 100 odd of that.

Okay, so they won't see, sir, or do we still have some kind of a portion in the order book left as on data?

No, we don't have a new order book. We're just completing one of the remaining work in there, and of course, most of them are almost in the completion stage. This is the performance reviews, some last pending work in terms of punch points, final billing, final collections. So, yeah, it's towards the no major groundwork, and no budget capex are now exhibited over there. It's just completing the remaining work.

Thanks, sir. Secondly, it's on the TP solar, our manufacturing business, where because of the change in the clientele mix, I believe this quarter we did a lot of third-party sales, our margin escalated significantly. So how should we look at this? I mean, like, if this was a quarterly event or going ahead as well, we will be having a similar kind of sales mix for the segment.

It was a very small quantity, not that we did a very large quantity of cell or cell. So, typically what happens is you have orders for modules, and some of them are PCS, some of them you can do with imported cell. So, in those cases, we have some of our own manufactured cell, which is available, and we take that market benefit, but it's not that there is a large quantity, and going forward, it may be there for a few more quarters, where we may have some additional quantity of cells, because there is still certain A11, certain imported cells you can use in some of the projects like open access, Okay, okay.

And I just may just ask another question, sir. This is a follow-up to the previous participant where you mentioned that the discussions are on, probably that to do away with the intermediaries like Secchi and all in signing a PPA. So how exactly should we look at it? Would the concentration move me more than that? More towards the CNI and data center signing PPA, or even on the DISCOMP side, there would be more on a bilateral arrangements.

Sorry, your voice was breaking.

Could you just repeat it once again?

Okay, so this was a follow-up question, sir, on our previous participants, where you mentioned that the discussion to do away with the intermediaries like SECI in signing new PPAs. So as a strategy going Are we focusing more on signing PPAs towards C&I and data centers, or even on our DISCOM side probably we can have a more bilateral discussion than signing a PPA. How exactly should we look at it?

Right now what we are seeing is solar and wind or even for that matter hybrid projects, the demand through the central agencies is much less. So, we are also avoiding that sort of arrangement that we are directly bringing to the states, excepting for pumped hydro, where this is a new storage solution that is being provided. But other than that, we are not looking at doing too much with the central region.

Thank you, sir. We'll move on to the next question. It's from the line of Brahani with Evander's Park. Please go ahead.

Am I audible?

Yes, sir.

Yeah, good morning. So, the question I have is regarding Mundra's supplementary PPA. So, though the power is being scheduled under section 11, we are billing based on the supplementary PPA. Could you give me the details of how this tariff and how much of profits from the coal sales in Indonesia is getting knocked off when we are completing a tariff? Some color on the supplementary PPA tariff would be helpful.

So, presently, the supplementary PPA is on actual cost of coal, and all parameters, including heat rate on actual. So, it's more towards a cost reimbursement and cost reflective without any margin to be made from the plant. So, that's the type of arrangement, overall arrangement.

So, how is this different, or how was this different earlier under the supplement, sorry, section 11 mechanism, say, one or two years back?

So, section 11 also gave you cost reflected, but it also protected your fixed cost to the extent. Here, the fixed cost is also on a normative basis so that you do not lose money, but also that there is no return on equity that you will get. So how much would be the fixed cost per unit right now in this plant? That keeps on again changing, so it's very difficult at this stage to say, but we're still working out the modality though.

So as I understand, the fixed cost is not being covered under this supplementary PPA.

I didn't say that. I said that fixed cost is covered, but it is cost reflective. That means whatever is your fixed cost for operating the plant, you will need to get that fixed, but you will not get a return on equity.

Yeah, that's what I meant.

Okay. Thank you.

That clarifies.

All the best, sir.

Thank you. The next question comes from the line of Umar Manon with Urjtine. Please go ahead.

Hi. Thank you for taking the question. My first question was on the Delhi Discom. I understand that on Odisha Discom, it was due to collection, reduction in collection. Is that the same for Delhi Discom as well?

Yeah, as I mentioned to you, typically in summer months, you have very large consumption, and you do the billing after the end of the month, and it comes after a month. So that's why your collection during that month is little less. So, just for example, June, I will collect what I build in May, but June, there is a huge billing that takes place and that only I will get in July. So, if you look on a 12-month basis, you will find that we are on track. But if you look at on just a quarterly basis, and this is true for all the, throughout the year, winter months, you will have very less. So you will, it will not be, again, defective. So I think you need to look at it on a 12-month cycle, and you will see that we are very much on track.

Understood, sir. Thank you. My second question is on the Rithala plant. I see that it's not listed in the capacity this quarter. Any particular reason why, sir?

Rithala plant was closed long time back, way back. So that's why it's not an operating plant. It had issues on tariffs and depreciation issues and all that. And that has now been finalized and made for that.

Understood, sir. Thank you. Those are my questions.

Thank you.

Thank you. The next question comes on the line of Sagar Parekh with Renaissance Asset Managers. Please go ahead.

Yeah, hi. Thanks for taking my question. Firstly, if I look at the cluster-wise numbers that you have shared on the Mundra coal and shipping, so we see your EBITDA has declined, but your pad has actually grown. So if you can give me the break-up on number of 25 crores of top-line and 225 crores of pad, from the coal and how much losses from Mundra?

No, we don't give a separate split here, but we can get in touch with you to answer separately and give you some breakups. But suffice to say that the increase in the path that you see is because of a higher share of whole profits.

But Munra wouldn't handle losses, right, if you say that?

Munra, yeah, depending upon the quarter as Dr. Sina already said, The way the SPPA is devised that you kind of get your cold pass-through plus you get your fixed cost, and of course, to that extent, there will be some undercover recovery, but the effort is to kind of ensure that we don't lose anything on the ROE perspective.

Right, and second is around the TPS, your modules are already running at full capacity, right, so you will be around 3,800, probably in that range for the full year.

Mr. Sagar, we are unable to hear you. Could you please repeat your question again?

Can you hear me now? Hello? Yeah, please go ahead. So, my question was, your overall volumes in modules and cells have been declining. How should we read into this for the full year? And secondly, in terms of margins in PP Solar, You are at about 25-26% margin. Now, I understand that in the next 6-8 months, a lot of capacities are coming up across the industry. So, how do you read the margin scenario going forward with the supply demand?

There are two parts of it. One is that the module's production has increased. For the first time, we have crossed 1,000 megawatts in the quarter. Secondly, the cell has reduced because there was a line change that happened. But you have to look at it from one is cost of production and the efficiency that has come. The second is also the product that we are making is having higher efficiency. So because of that, there was a little bit of a sacrifice on the yield and that is why. And when you have a higher efficiency of the cell, then you can command a premium on that. So that's how the margin is there. We are trying to ensure that our both yield as well as efficiency now peaks and you will see that sort of result.

And in terms of margins overall for the industry and for you also, we are at about 25% broadly Thank you.

Thank you very much. Thank you very much. I know that we are rushing Thank you very much.

Thank you. On behalf of Datapower, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.