Tata Power Company Limited (TATAPOWER) Q4 2026 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to the Tata Power Q4 and full year of 526 earnings conference call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star and then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Dr. Praveer Sinha, CEO and Managing Director of Tata Power, for his opening remarks. Thank you, and over to you, sir.

Good evening, everyone, and thank you for joining for this call. I have with me my colleagues, Sanjeev Churiwala, the CFO, J.B. Patel, the Group Financial Controller, Kasturi, Chief Treasury and Investor Relations, Anushul, and other colleagues from Finance and Corporate Communications. Before I share with you some of the major highlights of the useful performance of the year, let me just quickly share with you our understanding of the power sector in the last few months and as of now. We saw in the last quarter that the increase in demand was very modest of 2%, and we are now seeing from April onwards that the demand has gone up by 5% to 6%, and the peak power also has touched 256 gigawatts. We do expect that in the next one to two months, this will cross about 270 gigawatts. And this is because of the heat wave that we see across the country. And also because of the prediction that we will have a severe impact because of Nino. So, we do expect that the demand will increase both in terms of peaking requirement and energy requirement and we are already seeing in many places Mumbai has crossed 4,600, Delhi is more than 6,500 and so also many other places we are finding that the demand is going up. Fortunately, in our country, our power systems are very stable. The increased demand is met mainly by our coal-based plants and hydro plants, and also renewable solar and wind supporting them during solar hours and wind hours. We have also seen that for our imported coal-based There has been no impact per se. There is adequate supply of coal that is coming. There is, of course, a small increase in the prices of coal and shipping, but those are very, very nominal increases that have been seen in the last two months. Coming to the financial performance, I think Datapar has posted a very strong financial and operational performance in FY26. This is in spite of the fact that Munra did not operate for nine months, and we have for the first time have reported a full year pattern of nearly more than 5,000 crores, and the EBITDA, which is also gone up by nearly 11% to 65%. We have seen our EBITDA has jumped by nearly 10% to 4,216 crores compared to 3,829 crores last year. Pat has gone up by 8% to 1416 crores compared to 1306 last year in the same quarter. This, of course, has been driven by all our businesses. I have been sharing with you that our solar cell and module manufacturing plant is doing exceedingly well. We have stabilised the operations of the plant and the yields are very good. We have seen during the year the plant has delivered a PAT of 857 crores which is more than double of the previous year. Similarly, rooftop solar has done exceedingly well with doubling of the installation and we have also seen not only in the quarters but through the year the performance has been exceedingly well with a PAT of nearly 500 crores. Udisa Discom has done exceedingly well. In the previous year, the whole year's PAT was just 439 crores. This year, we have a PAT of 809 crores. In our utility-scale renewable, we have been able to commission a large number of projects, and in-house projects which have been commissioned have started yielding results, and we do expect that the nearly 5 gigawatt of projects which are under implementation, and these are all in-house projects, 50% of it will be completed in this financial year, And the balance 50% in F by 28. So, a very robust pipeline of projects and we are on top of them in terms of implementing and start generating power from all those plants in the coming two years. We did have a challenge of Munra and because of that we had issues about the shipping profit also. But that is a thing of the past. We have now concluded the SPPA with Gujarat, and we are in the process of finalizing it with all the other four states, which we expect in the next four to six weeks we will complete. They are in a very advanced stage of approval in these governments. We are already operating the plant under Section 11, but with an understanding that the tariff will be as per the SPPA, and that has been accounted for in our quarterly results, and going forward it will be accounted for in our operations. Our distribution business everywhere will continue to grow, and we will have large capital We have informed you that we are going to start work in our new 10 gigawatt of wafer and ingot up plant in two phases. That will cater to our existing operation of cell and module plant, which will require Indian-make wafers from 1st June 20-28 onwards. So, we do feel that on our businesses which have now stabilized, will do very good performance in our coming On the balance sheet also, I find that our debt is at 56,000 crores, and this is in spite of a capital expenditure of nearly 13,000 crores in the last financial year. Our leverage ratios are very stable. Our net debt to underlying EBITDA is 3.3, and our net debt to equity is 1.2 which is very competitive for infrastructure and power industry, and we do expect that we will maintain similar discipline while going forward with our new investments in the coming years. As we have been sharing with you, we believe in growing, but the growth has to be very calibrated so that the financial discipline and the balance sheet discipline is maintained, and we are We are committed to enhance our generation capacity, and also enhance our transmission, distribution, and hydro generation facilities in the country as also in Bhutan, and we will continue to perform exceedingly well in the coming quarters. With this, I will conclude my part of sharing my thoughts on the company and also on the power sector. I do look forward to hear from you and take your inputs as also take your questions and respond to them. So, you can please start asking the questions.

Thank you very much.

We will now begin with the question and answer session.

Anyone who wishes to ask a question may press star and then 1 on their touch-tone phone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handfix while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Your first question comes from the line of Somit Kishore from Access Capital. Please go ahead.

Good evening, Dr. Sinha.

You mentioned in your opening remarks that the capex for the financial year has been 130 billion rupees. This is meaningfully below the guidance that you had given to us in November in Odisha, which was 250 billion rupees. So what really led to that guidance with four months remaining in the fiscal, seeing such a sharp decline? And what is your guidance, realistic guidance for FY27, and what will it comprise in terms of the end projects? That's my first question.

Yeah, Sumit, so I agree that our guidance was, I don't think 25,000, but it was, I think, about 20, 22,000. We have fallen short because some of the projects that we were planning to execute in the last quarter could not happen, and these projects are typically relating to the large utility scale projects, solar projects or wind projects, or are the transmission line projects. Many of the places the right of way got delayed. Many of the places the transmission system was to be done by someone else under the TBCB. We were supposed to use that transmission system for evacuating. That got delayed and you have seen there have been large number of reports of many TBCB projects, especially ISPS projects getting delayed. We are now in this quarter trying to complete some of the projects around 600 megawatt of large Similarly, in the pipeline are some of the transmission projects that we are executing as the ROW issues are resolved. So these are not that, these will not come, it's just that the phasing has got impacted, and those which we missed out in the last year, we will complete all of them in this financial year. So that's why our target of yearly investment continues to be the same, and there may be a certain requirement by a quarter or two, but otherwise we are very much on track.

Sure. Now, I was referring to the slide in your book, Neshwar, presentation, which shows 25,000 crores of capex. So, the second question is of the Delhi distribution business, where, you know, in the last two quarters, there have been regulatory, favorable prior period regulatory orders. The quantum was 4.6 billion rupees in Q3. in Q4 at the EBITDA level, and the profit level positive impacts have also been shown. So can you, or, you know, can Mr. Sanjeev sort of clarify, what is the entire benefit that you have taken because of prior period regulatory orders at EBITDA and profit level in FY26 and FY25, how much is expected, you know, or it is very difficult to predict, But what sort of claims do you think are rightfully yours, which are yet to materialize because these are meaningful deltas in the quarterly results? So let us say for FY27, you know, is there any expectation that we should have or we should budget for a decline in reported numbers for daily distribution?

Yeah, so I think what you're saying is relevant, but a little context to that, the good part is whenever you see the regulatory upside, those are pertaining to matters a few years back. You know, either those regulatory approvals were denied or deferred. So as a result, you know, we're really happy that many of those past regulatory clearances are now coming in. And this is not the first time that we are getting this clearances. This happens every year. In fact, if you look at F25, we had about 333 crores of regulatory approvals coming in. This year, as you rightly picked up, 783 crores is reflected. Next year, too, we will have something. But to quantify at this stage, it might be very, very difficult because there are a pipeline of regulatory assets that we are kind of testing and discussing. And, you know, as you are aware, it's very difficult to predict an outcome, you know, on a regular settlement or a regular clearances. But yes, we would expect some amount to materialize, now whether that is low or higher. I think today is very difficult, but my chance is as and when every quarter passes on, we should be able to give you a better understanding on that.

Sure. Just one last bookkeeping question. What is the IPPRE capacity that you expect to add in FY27?

The second question is very clear forward. That's the whole purpose why we have put up the cell and module manufacturing. And I think we are kind of quite integrated that we are able to kind of have the entire lineup of cells, modules blocked in for all the pipelines. And as you can see, we have a moment. We are trying to show you what 5GW of pipeline as we speak and a lot of things will start materializing. This time around from quarter one onward. So from a capex pressing point of view, I think we will see in the current year a lot of consistency coming in.

Also, Sumit, last year we did a huge amount of third party projects. This year we don't have third parties. So everything that we will do will be in house. Last year we did about 2500 megawatt of total project implementation. So you can imagine that 2500 will be virtually internal that we will carry out and maybe a little more than that.

So if you deliver for instance 2 gigawatt of solar project, then the requirement of module 10 will be 2 into 1.4, the multiplying factor. So, about 2.8 out of your capacity will go into, in this example, it will go into your own capacity addition. Is that the right understanding?

Absolutely, and then if we have rooftop, so whatever we are going to manufacture, we are virtually going to meet our own requirements.

So, the intra-pigment elimination should basically reflect that in F527.

Thank you.

I think it's largely around the RPT compliance in terms of the margins, but are very, very consistent. So that should not be posing a problem for you to kind of do your modeling as well. But I think you kind of alluded to the 2 gigawatt of commissioning next year, which is kind of a wall pack number that we're also looking at. And if everything goes well, maybe it could be slightly higher than that.

No, but everything is not solar.

Solar and wind combined.

So solar and wind combined is there. So, polar would be about 1.5 to 1.8. It will not be 2.5 or 2.8.

Got it. Thank you so much, and thanks for the wonderful distortions. Thank you once again.

Thank you. Ladies and gentlemen, in order to ensure that the management is able to address questions from all the participants in the conference, please limit yourselves to two questions each per participant, and you may rejoin the queue for any follow-up questions. The next question comes from the line of Puneet Gulati from HSBC. Please go ahead.

Yeah, thank you so much, Sam, and you know, congrats on good performance. My first question is on Odisha.

You know, you've been giving phenomenal performance, you know, year after year. Do you still see room for more efficiencies

or should we sort of pencil in future growth more from regulated equity growth only?

You will get to see much better than this in the next financial year, and I think next financial year possibly will be the best year for URSA, because many of the initiatives that we had taken in the last few years have started showing results. Some of the initiatives were taken last year, and the impact of it you will see in this year. I think URSA performance Next year should possibly be this in terms of the type of results you would see. Okay, that's very interesting. And second is on the hydro side, you started taking, you know, large exposures to hydro now. And is the PPA already in place or

would you be looking to sign PPA in sometime?

It is in advance stage of approval, as you know that while the PPA is agreed, it has to go through a regulatory approval process, and that process is under final stages, and we do expect in the next few months that approval will come in.

And lastly, if you can comment on the regulatory asset wind down in Delhi, the Supreme Court had indicated an intention to wind this down. Any progress there?

Yeah, so both the Supreme Court and AFTIL are monitoring that, and the Regulatory Commission has promised that this will be amortized over six years, up to 2032. And we are closely monitoring that. They have already given an affidavit under which they will amortize it, and we expect I expect that it will get implemented as per the as per the affidavit that they have provided.

Understood. That's it. Thank you so much and all the best.

Thank you. Your next question comes from the line of Apoorwa Bahadur from IIFL Capital. Please go ahead.

Thank you. Thank you for the opportunity, sir. Can you provide some color on the Gujarat SPPA? What is the agreement over there if you are sharing any profitability on call? What's the quantum?

So, Gujarat SPPA details we have already shared, and since it is also under discussion with the other four procurers, more details finally what is agreed we'll share once everyone signs on the dotted line.

Okay, sir. And in your disclosure for renewable business, we see that the PLF for solar is lower due to lower resource availability, and also there is a comment on curtailment. Can you quantify the impact of curtailment in FY26 and your expectation in FY27?

So, the curtailment are happening in few places, and that also is not on a continuous basis. So, very difficult for us to say that how much of curtailment will happen. Also, some of the lines have been commissioned. So, it is not that there is full curtailment part of, so, in some cases at least 60% they have allowed to evacuate, in some places they have The Q&A is allowed 80%. In some places it is at 20%, 25%. So it's a moving target which is there and we continue to work with the transmission companies and Ctu to ensure that the curtailment is reduced and we are able to evacuate all the power. So, in cases where we have the GNA and curtailment takes place, there, of course, we are reimbursed the cost on deep supply data.

And so, for next year, the FY27, the target we have for adding solar capacity, do we have permanent GNA for all those substations or some of it is still on temporary GNA?

No, so now we are being extra careful, and that is why some of our CAPEX, which we had planned last year, got deferred, because we do not want to set up the plant and be on temporary GNA, so we have been very cautious now, and we are only commissioning or completing the project if we have certainty on the transmission line and the permanent GA happening. So that That action has been taken down.

It makes sense, sir. Sir, lastly, if you can provide some color on the Indonesian coal prices, especially after the West Asian war, the index is backward looking. So, what's your take over there, how the prices should move this year, as well as there was some news flow around potential tax imposition by the Indonesian government on coal mining. So, if we can have some view on that as well, it will be very helpful.

One is on the cold prices, that there has not been too much of movement, and we expect that prices will be within plus minus 5% in that range. We are not expecting too much of deviation. The second is that we are hearing that there will be some more taxes that will be imposed on export of coal, but this has been under discussion for last many months, so let's see what eventually gets decided.

We have shared some details on all the thermal coal prices, also including Indonesian coal prices, in slide 24, the analyst presentation which is uploaded. You can have a look at that if you want.

Virtually flash for Indonesian coal.

Sure, sir. Sir, lastly, if I may just squeeze in one more, in your cash flow statement, there's an item of movement and balance related to service concession agreement. So, what is this regarding because we see it has been a drag on cash flow for this year.

TBCP project. CAPEX is related to TBCP project. It is there in the working area.

So, it's a drag because revenues have not been recognized.

Yes, it is related to CAPEX spend on our service concession arrangement. It's one time of CAPEX only. It is shown in the capex in the presentation of the investment presentation.

Okay, okay. So ideally, it should be added to capex. Understood?

Okay, on that.

Upward, sir.

Do you have any further questions?

No, I am good. Thank you. I will get back in the queue.

Your next question comes from the line of data again from Avalanche Park. Please go ahead. Thank you. Thank you for the opportunity, sir. So, my first question is on the Muzra plant.

Is the entire plant operating under the supplementary PPA terms or is it only the Gujarat part? Is the rest operating under Section 11?

So, the full plant is operating all the five units. The Section 11 is to facilitate the operation of the plant and give time to the procurers to get their necessary approval. The billing that is being done is being done as per the SPPA, as per the overall understanding that has been reached with them as well as with Ministry of Power.

Understood. So my next question is on the key growth drivers, which segments do you see to contribute most in the coming next two years for Lepidda growth?

Key growth drivers for the next two years.

Next two years, I have explained to you, all these businesses will give good profit, good return. So, generation, transmission, distribution, renewable, manufacturing, rooftop, utility scale. So, each of these businesses are doing very good. We had a drag on Munra that also is behind us. So, you will see excellent performance going forward. Understood.

That's it for now. I'll get back to the queue.

Thank you. Thank you. Your next question comes from the line of Safiyabi Jain from Ambit Capital. Please go ahead.

Hi. Thank you. First question on the supplementary PPA and the coal mines. In the past, I think we were meant to understand that once you find the supplementary PPA, then maybe you look to monetize the coal assets. Is that thought process still intact? And let's say if you sign the supplementary CPAs in the next few months with other states, would you look to start the sales process sometime this year, just trying to understand where you are in that cone to monetization?

It also depends on what sort of opportunity is there, what sort of valuation we get. If the whole market is good and we get a good valuation, we can always look at that. It is a little premature. Let us first sign with everyone and then see how the market is there. At the right time, we will take the decision which is benefiting us.

Okay, fair enough. Just a clarification on the RE captive use of modules and cells that you mentioned. As per the order, any new tender after 1 September, the developers have to use domestic cells. But there is no mandate before that. So, given the tariffs that you bid for won't reflect that domestic cell deployment, why would you look to use domestic cell in your FI27 commissioning, given I believe this year you would be commissioning projects that were awarded before September 25th. I just decided to understand there. And secondly, it would be solar rooftop. So, you've executed 1.7 gigawatts, which means almost 20% market share. Is that something you are looking at in terms of SI27 also? That market share has remained intact despite competition. We're just trying to understand what is the opportunity you're looking at next year and what's the market share you're targeting?

We are definitely looking to enhance our market share and our target is that in next year we will be 20%. And having said that, we expect our rooftop business, you have seen, last year it has grown by 100%. I definitely expect in this year also it will grow substantially more than what is expected from the market at this time. I do expect that by 27 the rooftop market, the rooftop business will grow if not by 100 percent at least by 50, 60 percent. So you will see exceedingly I also expect that most of our rooftop, you know that for rooftop, if you have to get the government subsidy, then it has to use Indian-made cell and module, so that will be catered Also, in going forward, effective 1st June 2026, you have to use only Indian-made cells, and many of the projects are not grandfathered. So, some of the projects which will get implemented by 27 will require Indian-made cells and modules. So, I think our manufacturing plant is very Thank you so much.

Thank you. The next question comes from the line of Atoll Piwari from J.P. Morgan. Please go ahead.

Yeah, sir, I missed the F.Y. 27,000 capex guidance. Can you please repeat it?

In the same range, it's about 25,000. That is what we are expecting. As I mentioned to you, those projects which we missed out last year, we'll ensure that those get completed in this financial year, and these are a range of projects. These are not just a large utility scale, but it is also including the distribution projects and the Thank you.

The next question comes from the line of Mohit Kumar from ICICI Securities. Please go ahead.

Good evening and thanks for the opportunity. My first question on the note number five of the consolidated P&L. There is an amount we mention of 250 crore deferred tax assets. Can you clarify whether we need to adjust or increase the taxes by 250 crore to arrive at the profit for the quarter?

So, as you are aware, this is a deferred tax non-cash. So basically, given our future profitability projection, so I think I will give you some genesis to where this is coming from. We had, of course, a lot of carry-powered losses, and, of course, when you look at the standalone book, everything has to be adjusted against the standalone book to fully organize this. We have better visibility of profits in the subsequent years now, and we feel that some of the carry-powered losses can now be utilized within the time frame. And as such, for my statutory purposes, we have to recognize the different facts in the books, which we have done in quarter four now.

So this has impacted our consult profit also, right? Consult profit positively. Understood. My second question is the Tata projects, it has been making losses for, it was making losses prior to FI 24, I guess. And 24 was the first year I think we started making profit, F26 again I think they lost, F25 they lost, F26 again they lost. What is the outlook on the same for as we enter F-27 or F-28? Do you think the losses will get restricted now?

What has happened in Tata projects is that they had legacy projects such as the dedicated freight corridor project from the refining project in Varme and some other projects which are there. Fortunately, all those projects have now been completed and very little of it is left and we expect that those legacy projects impact will be very minimal going forward. The subsequent projects that Tata projects have got have good margin and I do expect that in FY27 it will One more question, if I can excuse me.

We haven't seen accretion to an underdevelopment RE portfolio for a long time. How are you thinking about bidding for new assets for renewables given the, of course, the sectoral headwinds right now? Do you still want to remain under pause, or do you think we can start adding to the portfolio from AFI 27 onwards?

Yeah, so as we mentioned to you that many of the places, there were two challenges. One was the transmission line have got delayed and there's no point in taking a project and not able to implement it because the transmission system or the power evacuation system is not ready. Secondly, we have now come up with a unique solution where we can offer renewable projects along with We are looking for that sort of arrangement. These type of arrangements are not only with utilities but also with large C&I customers, steel companies. We are in discussion with Tata Steel and some of the other large data centers which are coming up and we do expect that going forward we will not do pure solar or pure wind but it will be hybrid with storage and those Those will be much attractive in terms of the returns compared to the type of projects which have been bid out in the last two years.

Understood.

Thank you, Mr. Patel. Thank you. The next question comes from Dalai Lakhvrishan from PL Capital. Please go ahead.

Yes, sir. Hi. I'm an animal. Yeah. Sir, in terms of commissioning, you have mentioned... Sorry, I think there's some...

Yeah, sorry. So, in terms of commissioning, I think you mentioned we'll be adding two and a half gigawatts this year and two and a half similar number next year. And further, like, you know, 1.5 to 1.7 gigawatts is solar. But if I look at the pipeline, then solar number is pretty small at 600 megawatts only. So, is this, I mean, like, are we adding FDRE or complex FDRE? I think if you can give color or maybe a breakup of two and a half between these.

So, those details are there, in which slide it is there? Seven. Seven. Seventy-seven. Seventy-seven. In slide seven, we have given the breakup, and those are the type of projects that you would see, which will be a combination of solar and wind. I agree that there are large number of wind projects which are there, and for that we have We have already tied up all the wind turbines which have to go, and we are going to implement all those wind projects apart from the solar projects. But these are all hybrid projects, these are not stand-alone solar or stand-alone wind, but these are all part of the hybrid FDRE projects that we are using.

Okay. And you are looking at your solar, you can also look at FDRE and hybrid, they will also have component of solar as well.

Okay, okay. But is it fair to say that a large part will be like 1.6, 1.7 gigawatt will be FDRE in this commissioning?

It will be a combination of all of this, but larger time could be for hybrid and FDRE.

Okay, okay, got it. And then in terms of commissioning, I think last year for our business, we added the one odd gigawatt. And now we are seeing like, you know, probably a pickup for us. So, I mean, is it fair to say probably the issues on transmission and other infra-related issues that are kind of behind us, and probably things are much better?

Not everything is behind us, but yes, some of the areas where it had gone delayed, they are now coming up, those projects are coming up, and we should be in a position to match our project implementation with the power evacuation timeline.

Okay, and maybe one last thing, anything that we can share that we are doing at Ada Power for nuclear as such, and anything that you are seeing, any traction that is happening on the ground? That's my last question, sir.

So, on nuclear, we have shared with you that we have working with three state governments. We have identified the land. We have also taken up for water allocation for which necessary approvals have been given to us and some are in pipeline. We are also carrying out detailed geotechnical studies of each of these, and then nuclear plants require different types Most of the new technical studies are under progress. We are now doing detailed DPR of projects to be set up and this will be done in collaboration with NP3IL. These are small modular 2x220 NW plants and we do expect that some of them, especially some of the states, we will be able to do a proper DPR in just six months' time. And we are also parallelly working on some of the other aspects which needs to be finalized with nuclear power corporation. So, quite a detailed discussion, but it will take some more time for us to finalize the arrangement.

Okay, okay. But when you say, I mean, DTR, so probably in terms of megawatt and all, it's still not, it's still kind of WIP as of now, that is.

I told you 2 into 220 megawatts.

Okay, that is one. Okay, okay, fine. Yeah, I think thanks for answering all the questions.

Thank you. The next question comes from the line of Nikhil Naganya from Bernstein. Please go ahead.

Hi, thank you. I had just one question. I know the company has taken a stance to not add any new coal-based generation capacity. Wanted to check if there is any change in that. You, given so many states, are coming up with coal-fired power plant tenders.

Well, we are examining that. If there is a good opportunity and we find that the tariff is attractive and it's a bankable PPA, we'll definitely look at those.

Got it. Understood. And I'm going to ask this one more question. I think, you know, only a question on the use of domestic, the cells you are producing. I understand the use for the rooftop solar segment, but on the utility scale

side, most of your tenders are pre-2025 day, so I agree they should not be needing

DCR cells, so anything I am missing there?

I think some of them do require domestic, so we are working on that Thank you.

Thank you.

Your next question comes from the line of Rajesh Majumdar from 361 Capital. Please go ahead.

Yes, good evening, sir, and thanks for the opportunity. So, I had a couple of questions. On your slide 7, the current operational capacity is 16.7 gigawatts and including pipeline is 26.3, which means an addition of 10 gigawatts. So, is this the FY30 figure, 26.3, or how should we take this figure? That was the first question.

This is the current pipeline. So this includes the 2800 MW pumped hydro at Shirota where the work will start in this financial year and all the existing, that means the Bhutan Hydro 600 plus 1125 where we have already signed the So, this takes care of all. Some of them will come up in 2031-32. That is, the 1125 Bhutan project will come in that year. Some will come in 3031. But, of course, all these solar and wind projects will come by 2030.

And so your capex figure of 25,000 crores, if we take an addition of 2 gigawatts per annum then the capex is roughly about say on the higher side maybe 12 to 15,000 crores. Does this mean that 10,000 crores of regulated capex will happen in FY27?

No, I think it's not about regulated capex but a combination of all the capexes that Dr. Sinha spoke about. Of course, if you get 2.5 gigawatts of pure only solar and wind, that as you rightly said that could be 15,000. But then you have capex coming up in pump storages, capex coming up in pure hydro. So a combination of all of this, in transmission as well. So I think a combination of all of this, next year's 25,000 crore census is probably going forward also. We'll have a similar kind of capital outplay.

My last question is, we have signed the SPPA with Gujarat, of course, but now if by the there is an export duty or royalty which comes from Indonesia, then how does it work with the SPPA and how does it impact the negotiations with the other states going forward?

Coal cost is a pass-through, so whatever is the cost of coal will be paid for, so that's the type of arrangement that we have.

Including a major royalty change?

Well, it's a coal cost, FOB cost, it has to be a pass-through, whatever is included in All right.

Thank you. The next question comes from the line of Anuj Upadhyay from Investec. Please go ahead.

Yeah, hi, sir. Thanks for the opportunity. Sir, need one clarification on how should we read slide 7 and slide 32 together. Because slide 7, where we have highlighted 5 gigawatt of renewable capacity, of which, I guess, 1 gigawatt is a combination of plane, wind, and solar capacity, whereas we have 4 gigawatt, a combination of, I guess, 2.5 of FDRE and rest, the hybrid project and the RTC. But if I see your F532 slide, where we have highlighted the timeline of the FDREA and hybrid being getting commissioned, the contracted capacity comes only to the tune of 1200 megawatts. So does the 5000 gigawatts of renewable capacity is the actual installed capacity or the contracted installed capacity? Because to the prior question, you have mentioned that we'll be adding 2.5 gigawatts each of IPP projects. So, this is the contracted 2.5, the actual capacity.

This is the installed capacity. Constructed for DRN. Installed capacity is given in the slide 34.

Sorry?

On slide 32, Anuj, we have given the installed capacity and the heading is the contracted capacity. So, contracted will be lower than the installed. When we give the guidance, we give it on the installed capacity.

Exactly. So, Anshul, when you, you know, well, we have mentioned that four gigabot of hybrid and FDRE. So, does that translate to around 1,200 megahertz of contracted capacity? Is my understanding correct? Or we are, there are a few more capacity for which the details are not here because the PPO, the approval, are yet to be received. Okay. Okay. And my second question belongs to your ODC. Again, to a prior question, you mentioned that next year probably we'll be picking out in terms of the performance. So apart from northern circle, I believe, you know, other areas still hovers in the range of 18% kind of in AT&C. So what kind of loss reduction trajectory we can assume for the other three circles and to what level it can go? I mean, like North Odisha is already at around 10%, whereas others are already at 18. So, to what level we can expect the loss to further go down and by what timeline, sir?

Well, there is a trajectory that has been agreed with the visa regulator, and based on that, we do expect that all of them will come in 12 to 13% range in the next 4 to 5 years. So, you can expect that we will reduce about 2% every year, and that sort of will be your call for.

Okay. You maintain now four to five years, right, sir?

Yeah.

Okay. Okay. Well, thank you, sir. That's it, sir. Thanks for the opportunity.

Thank you. The next follow-up question comes from the line of Apuva Bahadur from IIFL Capital. Please go ahead.

Thank you, sir. I had a bookkeeping question. In your Q4 profitability for IEL, we see an increase of almost 63 crores and then similarly for Mumbai transmission as well of around 50 crores. Given the nature, regulatory nature of these businesses, is it safe to assume that there was a significant asset capitalization or are there any one-offs?

You know the deferred tax part, right?

No, one of the plans were commissioned. Okay, so it's an asset which has been added because of that.

In IEL?

And in a transfer...

Okay. So this increase is recurring for the transmission business?

No, no, that depends upon the asset capitalization timing and the deferred tax that is created because of that. So, yeah, I think it's not yearly phenomenal, but depends upon the asset capitalization and the property of that particular plant.

Okay, and same thing in IEL as well?

IEL. I am talking about IEL.

Okay, okay. And this on Mumbai Transmission?

It's based on Capex only. That is also Capex. That is based on Capex, pure Capex. It is recurring.

Okay, thank you so much.

Mumbai transmission adds every year 1,000 crore of capex. So, on a 70-30, you will have a return on equity on 30%. So, that's what you need to consider. Plus, certain O&M benefits.

Very clear.

So, thank you.

Thank you. Ladies and gentlemen, we will take that as our last question for today. I now hand the conference over to the management for closing comments.

Thank you, everyone, and if you have any other questions, please connect with Katsuri and Nanshul, and we'll be more than happy to respond to them. Also, if you have any suggestions on improving the quality of presentation or any more details are required, please reach out. We'll try to make it more analyst-friendly in terms of giving you more information and Thank you. Thank you to all of you, and take care.

Thank you. On behalf of Data Powers, that concludes this conference. Thank you, everyone, for joining us, and Human Out is Connect Your Line.