SJVN’s Q3 Net Profit Plunges 52% as Hydropower Generation Drops

SJVN generated 1206.97 MU of hydropower during the quarter

February 13, 2024


SJVN has recorded a net profit of ₹1.39 billion (~$16.74 million) during the third quarter (Q3) of the financial year (FY) 2023-24, a year-over-year (YoY) decrease of 51.6% from ₹2.87 billion (~$34.57 million).

The fall in profits was mainly due to less generation from SJVN’s two main hydropower projects, which decreased by 13.36% and 12.79%, respectively. This was mainly due to low precipitation in the catchment areas and, subsequently, low discharge in the Sutlej River.

The company recorded a revenue of ₹6.08 billion (~$73.25 million) during Q3 FY24, a 14.5% YoY decrease from ₹7.11 billion (~$85.66 million).

The company saw its expense increase by 7% YoY to ₹4.09 billion (~$49.27 million) during the quarter.

The Himachal Pradesh government introduced a water cess on electricity generation, impacting two operational projects totaling 1,912 MW in the state. The government issued a water cess bill amounting to ₹2.46 billion (~$29.63 million).

However, the Ministry of Power has categorically deemed this imposition illegal and unconstitutional. In response, it advised states against imposing any taxes or duties that contravene constitutional provisions, urging the withdrawal of such measures.

SJVN generated 1,206.97 million units (MU) of hydropower during the quarter compared to 1,376.83 MU a year ago. The company generated 35.28 MU of solar and 18.29 MU of wind during the period.

9M FY 2024

SJVN recorded a profit of ₹8.5 billion (~$102.4 million) during the first nine months (9M) of FY24, a YoY decrease of 37% compared to ₹13.42 billion (~$161.68 million).

The revenue for the April-December period was ₹23.04 billion (~$277.59 million), a YoY decrease of 15% from ₹27 billion (~$325.3 million).

SJVN generated 7,355.43 MU of hydropower during 9M FY 2024 compared to 8,331.9 MU a year ago. The company generated 121.16 MU of solar and 130.43 MU of wind during the period.

In a first-of-its-kind transaction undertaken by a public sector undertaking, SJVN secured ₹100 billion (~$1.2 billion) construction financing facility to fund its upcoming renewable energy projects. The financing was raised by Deutsche Bank, State Bank of India, Punjab National Bank, Bank of India and, Mitsubishi and United Financial of Japan Financial Group Bank.

Last September, the government announced its plan to divest up to 4.92% of its stake in the state-owned power company SJVN through an Offer for Sale (OFS). The floor price for this stake was set at ₹69 (~$0.83)/share. This OFS involves the government’s sale of a base offer comprising 2.46% of the company’s equity, with an additional 2.46% retained as an oversubscription option.

In April last year, the Ministry of New and Renewable Energy designated SJVN as the implementing agency responsible for floating tenders for renewable energy projects. It will also act as the intermediary procurer of power. SJVN will work with other agencies, such as SECI, NTPC, and NHPC, to float tenders and open bids to avoid concurrent bids.