InvestorQ : What explains the sharp profit growth in Power Grid for the fourth quarter?
Neelam Naik made post

What explains the sharp profit growth in Power Grid for the fourth quarter?

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Anu Biswas answered.
2 months ago
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Government owned listed play, Power Grid Corp, sales revenues grew 1.67% at Rs10,686 crore for Q4FY22. Powergrid witnessed growth in revenues in the power transmission and the consultancy business while the telecom business revenues lagged in Q4FY22. Cash from operations were lower by 10% due to spike in other financial assets. Long term debt to working capital ratio spiked sharply from 20% to 58% on a yoy basis.

Power Grid

Rs in Crore

Mar-22

Mar-21

YOY

Dec-21

QOQ

Total Income (Rs cr)

₹ 10,686.00

₹ 10,510.23

1.67%

₹ 10,446.88

2.29%

Net Profit (Rs cr)

₹ 4,156.44

₹ 3,526.23

17.87%

₹ 3,292.97

26.22%

Diluted EPS (Rs)

₹ 6.87

₹ 5.64

₹ 4.82

Net Margins

38.90%

33.55%

31.52%

Net profit for Q4FY22 surged 17.87% at Rs4,156 crore, despite the net movement from regulatory deferral account being unfavourable. Powergrid gained during the quarter from exceptional gains from monetization of assets under the AMP as well as from deferred tax credits. Net margins were 38.90% in Q4FY22 against 33.55% in Q4FY21 and 31.52% in Q3FY22. Operating margins were stable at 91% but the EBIT of core transmission tapered.
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