NTPC Limited (NSE:NTPC) Q2 FY23 Earnings Concall dated Oct. 29, 2022
Corporate Participants:
Ujjwal Bhattacharya — Director, Projects
Jaikumar Srinivasan — Director, Finance
Chandan Mondol — Director, Commercial
Analysts:
Anuj Upadhyay — HDFC Securities — Analyst
Mohit Kumar — DAM Capital — Analyst
Aniket Mittal — SBI Mutual Fund — Analyst
Apoorva Bahadur — Investec — Analyst
Nikhil Abhyankar — DAM Capital — Analyst
Atul Tiwari — Citigroup — Analyst
Kirthi Jain — Canara HSBC — Analyst
Bharani Vijaykumar — Spark Capital — Analyst
Anup Goswami — B&K Securities — Analyst
Koundinya Nimmagadda — JPMorgan — Analyst
Rahul Modi — ICICI Securities Limited — Analyst
Presentation:
Operator
Good day, ladies and gentlemen, and welcome to the Q2 FY ’23 Earnings Conference Call of NTPC Limited, hosted by ICICI Securities. [Operator Instructions] Please note that this conference is being recorded.
I now hand the conference over to Mr. Rahul Modi from ICICI Securities Limited. Thank you and over to you, Mr. Modi.
Rahul Modi — ICICI Securities Limited — Analyst
Thank you, Michelle. On behalf of ICICI Securities, I welcome you all to the Q2 FY ’23 Earnings Conference Call of NTPC. We have with us the senior management of NTPC, represented by Mr. Jaikumar Srinivasan, Director, Finance; Mr. Dilip Kumar Patel, Director of Human Resources; Mr. Ramesh Babu V, Director, Operations; Mr. Chandan Kumar Mondol, Director, Commercial; Mr. Ujjwal Kanti Bhattacharya, Director, Projects.
With this, I would like to hand over the call to Mr. Srinivasan for his opening remarks, and then we can have a Q&A session. Thank you for your time, sir. Over to you.
Jaikumar Srinivasan — Director, Finance
Thank you. A very good evening to all the participants. I, Jaikumar Srinivasan, Director of Finance, welcome all of you to the Q2 FY ’23 conference call of NTPC Limited. I have with me Shri. Dilip Kumar Patel, Director, Human Resources; Shri. Ramesh Babu, Director, Operations; Shri. Chandan Kumar Mondol, Director, Commercial; and Shri Ujjwal Kanti Bhattacharya, Director of Projects. I also have with me other key members of the NTPC team.
Today, the company has announced the unaudited financial results for quarter Q2 financial year ’23 along with half year results for financial year ’23. The key performance highlights for the quarter and the half year ended September 30, 2022 have already been disclosed on both the stock exchanges.
NTPC has completed yet another remarkable quarter with a very strong operational and financial performance. We have made significant progress on various strategic initiatives, including renewables.
The operational highlights of Q2 and H1 financial year ’23 are as under. During H1 financial year ’23, NTPC has added 1,952 megawatt commercial capacity to its portfolio, out of which a capacity of 672 megawatt was added from renewable resources. As on September 30, 2022, the commercial capacity of NTPC stands at 57,639 megawatts on a stand-alone basis and 70,254 megawatts for the Group as a whole. NTPC Group generated 204 billion units in H1 financial year ’23 as compared to 177 billion units in H1 of financial year ’22, an increase of around 15%. NTPC stand-alone gross generation in H1 financial year ’23 is 176 billion units as compared to 151 billion units in the corresponding previous period, registering an increase of around 16%. During H1 financial year ’23, PLF of coal stations of NTPC was 77.27% as against the national average of 64.46%, thereby maintaining a spread of above 12% over the national average. For H1 financial year ’23, four coal stations of NTPC Group, which are Rihand, Singrauli, Bhilai and Talcher were among the top 10 performing stations in the country in terms of PLF.
During H1 financial year ’23, there has been lateral generation due to grid restrictions and fuel supply of 40 billion units and 2 billion units, respectively, as against 52 billion units and 3.19 billion units in the corresponding period of the previous year. As regards the status of fuel supply, during H1 financial year ’23, materialization of coal against annual contracted quantity was 99.93% as against 96.04% in the corresponding previous period. Coal supply during H1 financial year ’23 was 112 million metric tons, including 10 MMT of imported coal. The coal supply during the corresponding previous period was 92.86 MMT, including 0.88 MMT of imported coal.
NTPC has registered highest ever coal production of 8.76 MMT in H1 financial year ’23, with growth of over 58% as against 5.54 MMT in H1 financial year ’22. Coal production from Chatti Bariatu mines has started from September 29, 2022. Cumulative expenditure of INR8,527.06 crores has been incurred on the development of coal mines till September 30, 2022.
Now I will update on various other financial activities. Total income for Q2 financial year ’23 is INR41,810.96 crores as against corresponding quarter of previous year total income of INR30,305.83 crores, registering an increase of 37.96%. On half yearly basis, there is an increase of 41.93% in the total income, that is from INR58,153.09 crores in H1 financial year ’22 to INR82,536.63 crores. Profit after tax for Q2 financial ’23 is INR3,331.20 crores as against INR3,156.74 crores in the corresponding quarter of previous year. On half year basis, PAT is INR7,048.16 crores as against INR6,417.66 crores in the H1 financial year ’22, registering an increase of 9.82%. Total income of the Group for H1 financial year ’23 is INR88,242.22 crores as against corresponding previous period total income of INR63,486.27 crores, registering an increase of 39%. PAT for the Group of — for H1 financial year ’23 is INR7,395.44 crores as against corresponding previous period PAT of INR7,134.7 crores, registering an increase of 3.65%.
During H1 financial year ’23, our subsidiaries have earned profit of INR867.65 crores as compared to INR790.14 crores in the corresponding period of previous year, registering an increase of 9.81%. NTPC’s share of profit in JV has decreased from INR526.45 crores in H1 financial year ’22 to INR120.57 crores in H1 financial ’23. During H1 financial year ’23, we have accounted dividend income of INR640.94 crores from our subsidiaries and joint venture companies as against INR613.46 crores received during H1 financial year ’23.
The regulated equity as on September 302, 2022 was INR74,865.53 crores for NTPC on stand-alone basis. As regards to fund mobilization, in the current financial year, NTPC has signed term loan agreement of INR2,000 crores, INR1,000 crores and INR2,000 crores with HDFC Bank, UCO Bank and Bank of Baroda, respectively, totaling INR5,000 crores. NTPC has issued bonds aggregating to INR3,500 crores during H1 financial year ’23, INR1,500 crores at the rate of 5.78% per annum on April 29, 2022 for a period of two years, and INR2,000 crores at the rate of 7.44% interest rate on August 25, 2022 for a period of 10 years. Average cost of borrowing as on H1 financial year ’23 is 6.22% as compared to 5.96% in H1 financial year ’22.
Moving on to capex. In H1 financial year ’23, we have incurred a Group capex of INR16,664.19 crores as compared to INR15,137.67 crores in the corresponding previous period. The capital outlook of NTPC stand-alone has been estimated at INR22,454 crores for the financial year ’23.
Further to list a few other highlights. NTPC Group has a strong commitment towards renewable energy. NTPC has diversified into producing energy through cleaner and greener sources such as hydro, wind and solar. The company has also forayed into a variety of business areas, including fuel cells, e-mobility, green hydrogen solution and waste-to-energy. NTPC Group has already commissioned 2,524 megawatts of RE projects under EPC mode till the end of the second quarter. Presently, 5,348 megawatts of RE projects, including ongoing projects of NTPC REL are under construction. Further bids for 650 megawatts have been won which will be awarded soon.
NTPC is well on the way for development of solar park of 4.75 gigawatts in Gujarat. Further plans for development of another 21 gigawatt ultra-mega Renewable Energy Park is in various stages. NTPC’s wholly owned subsidiary, which is NTPC Renewable Energy Limited has incorporated Green Valley Renewable Energy Limited as its subsidiary in a 51:49 joint venture with DVC. The main objective of the company is to develop, operate and maintain renewable energy park and projects in reservoirs and land owned by DVC.
NTPC has acquired 50% share in Jhabua Power Limited, JPL, through corporate insolvency resolution process. JPL located in Seoni, Madhya Pradesh, has an operational capacity of 600 megawatts. This is the first acquisition of power asset for NTPC through the NCLT route, a step forward in accomplishing NTPC’s long-term capacity addition target. Under the scheme of amalgamation, merger of Kanti Bijlee Utpadan Limited and Nabinagar Power Generating Company Limited wholly owned subsidiary of NTPC was affected by MCA order dated August 26, 2022, after being approved by shareholders and unsecured creditors in line with the order of Ministry of Corporate Affairs dated January 20, 2022. NTPC and IOC Limited signed a nonbinding agreement for proposed formation of a joint venture company for meeting the power requirement of new projects of Indian oil refineries. Going forward, NTPC proposes to form a JV company between its subsidiaries, NTPC Green Energy Limited and IOCL for supply of RE RTC power to IOCL.
Amongst the several MOUs signed by NTPC and its subsidiaries, a few are being highlighted here. NTPC Renewable Energy Limited has signed an MOU with Government of Rajasthan for development of 10 gigawatt ultra mega renewable energy power parks in Rajasthan. NTPC REL has signed the MOU with National Fertilizers Limited to collaborate in the field of renewable energy green chemicals and mutually explore possibilities of supply of 90 megawatt RE RTC power in phases and synthesizing 50 TDP green ammonia for captive use for production of industrial products by NFL. This is the first-of-its-kind novel initiative by two leading CPSCs to support the country’s commitment to achieving renewable energy targets and reduce greenhouse emissions. This comes in the backdrop of NTPC announcing its green hydrogen initiative and plan to build the country’s first pilot project for synthesizing green methanol, setting up green hydrogen filling stations, green hydrogen blending in PNG and green energy storage projects.
NTPC has signed an MOU with GE Gas Power, Mitsubishi Heavy Industries Limited and Siemens, severally, to demonstrate feasibility of hydrogen co-firing blended with natural gas and gas turbines installed at various NTPC gas plants. Under the significant collaboration, the companies will jointly explore the pathways to reduce CO2 emissions from gas or plants.
NTPC signed a MOU with Moroccan Agency for Sustainable Energy for operations in the renewable energy sector. The purpose of this MOU is to outline the framework for general understanding between the parties regarding their mutual interests and their assessment of cooperation opportunities in RE sector. The MOU has been signed between NTPC and Rajasthan State Mines and Minerals Limited for supply of highly high-purity limestone for FGD plans of integrated stations.
NTPC has signed an MOU with National Sports Development Fund and Ministry of Youth Affairs and Sports for the development of archery in India with an aim to provide world-class facilities with international exposures and platform to the talented pool of Indian archers. NVVN, our trading subsidiary, transacted 15.25 billion units during the H1 financial year ’23 as against 11.98 billion units during the H1 financial year ’22, registering growth of around 27%. NTPC has been bestowed with the Dun & Bradstreet Infra Award 2022 for excellence in power generation. NTPC has been recognized one of the most preferred workplaces of 2022 in the premier addition of the most preferred workplace ’22 organized by Team Marksmen in association with India Today. Besides, NTPC has won several awards in safety, CSR, quality and environmental categories.
These were some of the key highlights I wanted to share with all the participants in this con call before we begin the questions and answers. Thank you so much.
Questions and Answers:
Operator
Thank you very much. We will now begin the question-and-answer session. [Operator Instructions] The first question is from the line of Mohit Kumar from DAM Capital. Please go ahead.
Mohit Kumar — DAM Capital — Analyst
Yes. Good evening sir. And thanks for the opportunity. My first question is on the interest cost and late payment surcharge. I think you accounted roughly INR3.9 crores in the interest cost related to the electricity late payment surcharge rules. Can you please explain how much is the amount which is being availed in this scheme? And how we have done the accounting? And is it onetime charge? And also the finance cost has been restated for last three, four — for last financial year and last quarter?
Jaikumar Srinivasan — Director, Finance
Late payment surcharge, we have booked around INR392 crores. This you’re mentioning or you’re talking about the discount?
Mohit Kumar — DAM Capital — Analyst
Yes, it’s a onetime charge? And why it has been done?
Jaikumar Srinivasan — Director, Finance
No, there are two different things. One is the surcharge, which we are levying periodically. The other thing is we have booked a finance charge as a onetime. Which one are your referring to?
Mohit Kumar — DAM Capital — Analyst
Sir, looking to the onetime charge which you have booked. Can you please explain it?
Jaikumar Srinivasan — Director, Finance
One time charge, there is a scheme for restructuring the loans, outstanding loans. Installment has been given to many of our beneficiaries for different tenure, maximum being 48 months. And so this installment will be paid. And since there is no further LPS if they pay this on time, so from a time/value/money perspective, we have calculated the present value and accounted the differential as a charge, financial charge.
Mohit Kumar — DAM Capital — Analyst
This is a onetime charge. Am I right?
Jaikumar Srinivasan — Director, Finance
Yes. Yes. That’s right.
Mohit Kumar — DAM Capital — Analyst
Secondly, on this, what is the status of renewables monetization? Are you on course to meet the guidance that will do the monetization by FY ’23?
Jaikumar Srinivasan — Director, Finance
See, broadly, a 2,861 megawatt of renewable capacity has been identified for monetization, existing assets. And broadly, this has a book value of over INR10,000 crores. And we propose to offload some — anything between 10% to 20%, and we are in the process. But we expect that by the close of quarter three or in any case, before the end of the year, we’ll be able to conclude this transaction.
Mohit Kumar — DAM Capital — Analyst
Sir, if I understood correctly, we are not selling a stake in NTPC Green. We are selling a stake in only this identified two at 600 megawatt. Is that understanding correct?
Chandan Mondol — Director, Commercial
Yes. I’m CK Mondol, Director, Commercial. Actually, we are transferring our existing RE aspect to a separate company that is NTPC Green Energy Limited. And our existing NTPC RE, NREL is also under that company. And then we are offloading some 10% to 20% stake in NGEL. It is not corresponding to the particular asset. It will be in the addition of…
Jaikumar Srinivasan — Director, Finance
Stand corrected to that extent.
Mohit Kumar — DAM Capital — Analyst
And we expect to monetize by the Q3. Is that right?
Chandan Mondol — Director, Commercial
Our plan is there, it is scheduled to be by December, maybe some plus/minus some dates maybe, December or January.
Mohit Kumar — DAM Capital — Analyst
Understood. Thank you and all the best sir. Thank you.
Jaikumar Srinivasan — Director, Finance
Thank you.
Operator
Thank you. We have the next question from the line of Anuj Upadhyay from HDFC Securities. Please go ahead.
Anuj Upadhyay — HDFC Securities — Analyst
Yes, hi. Thanks for the opportunity. Sir, in the opening remarks, you mentioned that the profit from your JV has declined to somewhere around INR120-odd crores compared to INR526 crores on a year-in basis. Any reason for this non-performance, sir?
Jaikumar Srinivasan — Director, Finance
The decline is broadly from one or two subsidiaries, the Meja Urja and Hindustan Urvarak.
Anuj Upadhyay — HDFC Securities — Analyst
Okay. And why is this so, sir? I mean, the reason for the decline?
Jaikumar Srinivasan — Director, Finance
See, for the Meja plant, we had an issue with the boiler. So we had to take the boiler for around five months and repair it. So now the boiler is back in service. We will be able to recover substantial amount of this AFC from the remaining days.
Anuj Upadhyay — HDFC Securities — Analyst
Okay. Okay. And sir, secondly, can you just mention about the capacity which we plan to add for FY ’23, ’24 and if possible, ’25 as well? And the bifurcation among the project side, could be very helpful.
Jaikumar Srinivasan — Director, Finance
The capacity addition plan that we have for the year ’23-’24 is around 7,000 megawatts.
Anuj Upadhyay — HDFC Securities — Analyst
Combined, right?
Jaikumar Srinivasan — Director, Finance
Combined. And this includes Telangana Power, North Karanpura. These are the coal capacity being developed by NTPC directly. THDC Khurja project, which is our subsidiary, one unit; THDC hydro pumped storage in Tehri, 1,000 megawatt; NREL Solar, 2,295 megawatt; and NTPC directly solar, around 1,000 megawatt. For ’24-’25, we are aspiring to add another 6,000 megawatts, out of which 1,180 will be NTPC directly, which includes North Karanpura last unit; Tapovan Vishnupura Hydro projects; Patratu, one unit; Patratu second unit also will come; THDC Thermal Khurja second project; THDC Tapovan Vishnugad Pipalkoti project; NREL solar around 1,300 to 1,400 megawatt.
Anuj Upadhyay — HDFC Securities — Analyst
Okay. So overall, we are planning to add 13 gigawatts over FY ’23, ’24, ’25, right, sir?
Jaikumar Srinivasan — Director, Finance
Yes. Three years. And current year, we are targeting around 5,000 megawatts of capacity addition. So if you take the current year and ’23-’24, ’24-’25 taken together, it will be around 18 gigawatts.
Anuj Upadhyay — HDFC Securities — Analyst
Got it, sir. 18 gigawatts over the next three years. Fine, sir. And also you mentioned, sir, there is around 21 gigawatt of renewable capacity, which is under various stages of planning or development. This includes the 10 gigawatt you mentioned about Rajasthan, right, sir?
Jaikumar Srinivasan — Director, Finance
Rajasthan, you want to answer?
Ujjwal Bhattacharya — Director, Projects
Yes. So out of that 21 gigawatts of ultra mega renewable energy parks, 10 gigawatt, Rajasthan.
Anuj Upadhyay — HDFC Securities — Analyst
One in Rajasthan, okay. But it excludes the 4.5 gigawatt in Khavada project?
Ujjwal Bhattacharya — Director, Projects
Yes. This is in addition to 4.5 in Khavada project.
Anuj Upadhyay — HDFC Securities — Analyst
Right. And any time line, sir, for Khavada? I mean how the progress has been going on over there? By when we are expecting the bidding to begin?
Ujjwal Bhattacharya — Director, Projects
We have already started work on about 1,255 megawatts. We have awarded packages for the balance of systems. So we’ve already started work there. We’ve also started work on the part side. So we hope to foray further — with more capacity awards in this year. Balance we will award next year.
Anuj Upadhyay — HDFC Securities — Analyst
Okay. One clarification, sir. What I have understood is probably this entire Khavada project will go for a bidding, and it won’t be directly on an allotment basis. So this 1,255 megawatt you are saying, is this something which we have won under the bidding scheme or it was directly been allotted to us as a par developer theme?
Ujjwal Bhattacharya — Director, Projects
No, no, I think your understanding is not right. This entire capacity has been allocated to NTPC Renewable Energy limited. And we shall be developing the entire capacity on our own. There’s not going to be any bidding there.
Anuj Upadhyay — HDFC Securities — Analyst
Okay. Okay. So is this applicable for all the companies, sir, who have participated over there in Khavada? I guess it was — we had BPCL, we had Adani and some other PSUs as well?
Ujjwal Bhattacharya — Director, Projects
That is a choice they have to make. I can only talk about our company.
Anuj Upadhyay — HDFC Securities — Analyst
Okay. Fair enough sir. Thanks for the opportunity.
Operator
Thank you. [Operator Instructions] The next question is from the line of Rahul Modi from ICICI Securities. Please go ahead.
Rahul Modi — ICICI Securities Limited — Analyst
Thank you sir for a detailed discussion so far. Sir, a couple of questions that I had. Now the regulated equity has gone up quite substantially due to the inclusion of the [Technical Issues] in the stand-alone books. So can you help us with reconciling the profit numbers as obviously, the growth seems to be a bit muted, partly that can be understood due to the reduction in the other income, I believe in the late payment surcharge. Sir, what are the other aspects which probably we need to look at to reconcile because the growth in the regulated equity has been quite significant. So is there any adjustments which is happening due to the project? [Technical Issues] Yes. So just completing my point, is it due to the merger of the two projects within the stand-alone any adjustments that we need to pay attention to? Thank you.
Jaikumar Srinivasan — Director, Finance
There are one or two reasons. I mean, if you want to see the peculiar aspects during the quarter is, one is, as I mentioned, that this is a financial charge which we had for the discounting of receivables. That is one aspect. And there will be some tax aspect of merger close to around INR190 crores. This would be the peculiar item. Of course, the other income is gradually on the lower part because of better payment trends from the DISCOMs.
Rahul Modi — ICICI Securities Limited — Analyst
Sure sir. And can you just throw some light on the deferred tax asset, because how much of this is pertaining to the renewable assets which probably gets normalized over the course of the year, apart from the regulated business?
Jaikumar Srinivasan — Director, Finance
Maybe we can provide this information to you separately.
Rahul Modi — ICICI Securities Limited — Analyst
Sure sir. Thank you.
Operator
Thank you. We have the next question from the line of Aniket Mittal from SBI Mutual Fund. Please go ahead.
Aniket Mittal — SBI Mutual Fund — Analyst
Yes, sir. A few questions actually on the solar front. Sir, if I remember correctly, for execution of the solar projects, we were talking earlier that we would procure the modules ourselves and then do the balance of system works with the other players. So I just wanted to understand on that front, what are we currently doing in terms of executing this? Are we looking to procure the models ourselves and heading in that direction?
Chandan Mondol — Director, Commercial
Yes, Aniket, we are doing that only. So we have broken up the project into packages. One package is the balance of system, and we are — we’ve already awarded that for many of our projects. Modules we’ll be preparing separately.
Aniket Mittal — SBI Mutual Fund — Analyst
Fair. And so in this balance of systems that you’re providing, are these fixed-price contracts to EPC peers?
Chandan Mondol — Director, Commercial
Yes, it’s a fixed price.
Aniket Mittal — SBI Mutual Fund — Analyst
And in some of the earlier packages that you would have awarded to the EPC contract, given the increase in module prices, as it’s happened, are there any renegotiations that have happened?
Jaikumar Srinivasan — Director, Finance
No, they cannot happen, because in all these projects the tariffs which we have bid at, those are also not open for negotiations. There cannot be any [Technical Issues]
Aniket Mittal — SBI Mutual Fund — Analyst
All right. Understood. So just another aspect that I wanted to understand on the new energy space. So there are a couple of tenders that we’ve come out on the battery storage solutions. I think we came out with a large 3,000 megawatt hour tender, and there’s another 500 megawatt tender. I just wanted to understand the rationale for this, and what is it that you’re trying to use these battery storage for?
Jaikumar Srinivasan — Director, Finance
The one tender that we have come out for is a 3,000 megawatt hour energy storage tender that’s agnostic to the type of storage. It can be battery or farm storage or any other storage. That is mainly required for the C&I customers. We are in discussions with those, higher supply of power on long-term basis. That’s primarily for that. The 500 megawatt battery one, we had actually tried to look at the second tender, which is now done, but we understand there are other storage tenders in the pipeline so we might be looking at that. So that’s the rationale.
Operator
Sorry to interrupt. On the management line, I would request you to come closer to the Polycom and speak, please. Kindly proceed.
Aniket Mittal — SBI Mutual Fund — Analyst
Yes. So the 3,000 megawatt tenders is something that you will tie up with other DISCOMs, is it?
Jaikumar Srinivasan — Director, Finance
No, no, no. What I said was that this was for — mainly for supply to C&I customers with whom we are discussions with.
Aniket Mittal — SBI Mutual Fund — Analyst
Okay. Okay. Just one last question. So on this onetime charge that you’ve taken related to these the late payment surcharge that’s come up. Could you just elaborate, a, what is the total quantum of charge that’s been taken? And b, how have you accounted it for both in the balance sheet and the P&L?
Jaikumar Srinivasan — Director, Finance
Just a second. The amount of receivables which we have put to the scheme is around INR6,108 crores. And these have various maturities. Some of them will be a 48 months horizon, some will be 36 months depending on the quantum. This is eligible on a step-up manner depending on the number of days of this. So accordingly, we have worked out the present value and accounted for the differential.
Aniket Mittal — SBI Mutual Fund — Analyst
Okay. And what’s the differential that you’ve accounted for?
Jaikumar Srinivasan — Director, Finance
INR333 crores.
Aniket Mittal — SBI Mutual Fund — Analyst
Okay. And are there any other further receivables that can go under the schemes that will require us to again reevaluate?
Jaikumar Srinivasan — Director, Finance
No. The scheme is effectively — was open for a limited period and who all had subscribed to that has been taken into this scheme. So as such, we don’t anticipate any further increase in this amount.
Aniket Mittal — SBI Mutual Fund — Analyst
Fair. Those were my questions. Thank you.
Operator
Thank you. We have the next question from the line of Apoorva Bahadur from Investec. Please go ahead.
Apoorva Bahadur — Investec — Analyst
Hi sir. Thank you for the opportunity. Sir, a couple of questions. Firstly, if you could share the fixed cost under recovery late payment surcharge and the PLF incentive numbers for the quarter, that’d be very helpful.
Jaikumar Srinivasan — Director, Finance
See, the fixed costs under recovery for the half year is INR718 crores. However, I may just add that this is a transient figure because ultimately, the evaluation of your allowance and disallowances on an annual basis, this is a target availability, declared capacity on an annualized basis. So it doesn’t follow an even trend depending on the operational level of Q2. We stand here, but as we go ahead, this will be further mitigated.
Apoorva Bahadur — Investec — Analyst
Sir, what would be our expectation by year-end to what level should we head?
Jaikumar Srinivasan — Director, Finance
Around INR250 crores.
Apoorva Bahadur — Investec — Analyst
Sir, I assume the late payment surcharges will be very low this quarter, less than INR100 crores?
Jaikumar Srinivasan — Director, Finance
For the quarter, it was INR229 crores.
Apoorva Bahadur — Investec — Analyst
Okay. Sir, again, coming back to, I think, the previous questions on this onetime charge that we have taken for this LPS scheme. Now sir, I wanted to understand the impact of this for future quarters. So does this mean that the entire cost of the EMI which we’re going to bear, we have taken a onetime upfront charge and going ahead, we should not account for the incremental finance cost on this? So essentially, our finance cost in future quarters will be lower?
Jaikumar Srinivasan — Director, Finance
See, it is a onetime discounted differential which we have calculated due to the time value difference. However, as we go ahead and we start getting the money, this will be unwinded.
Apoorva Bahadur — Investec — Analyst
Okay. Makes sense. Sir, also, I think on this question of this EPC contracts that we have given for executing our renewable projects, I think one of the large contractors recently stated that there have been certain deferments in large projects because the module costs were quite high, right? So I think last time on our call, we had discussed that some of our projects will be delayed by a couple of months. So has there been any further deferments on that?
Jaikumar Srinivasan — Director, Finance
Yes. Actually, I believe many of the people have approached the government for giving more time particularly because of the very high module prices, which everyone has faced. And what we understand is that the government is considering some kind of a 12-month time extension in all without any condition. But then this is what we have heard. There is no document as yet — as such. So I’ll not say that it’s going to happen or not going to happen. But definitely, there is some relief being sought from the government because people are otherwise not in a position to do the project and are also [Technical Issues].
Apoorva Bahadur — Investec — Analyst
Fair enough, sir. Sir, one more question, I think, on this renewable monetization that we are still currently undertaking, so you highlighted that we intend to sell stake in this NTPC Green, which will house our renewable projects. Sir, I wanted to know for other new energy initiatives like what we’re doing on hydrogen or storage, is that also a part of this overall portfolio, which is under discussion? Or is it purely for the renewable projects that we are currently looking to offload the stake?
Jaikumar Srinivasan — Director, Finance
So look, NTPC Green ultimately will become a holdco, the green vehicle under NTPC. And for example, the NTPC Renewable Energy Limited, which is currently a vehicle which we are using for building and all these projects, that will also come under NTPC Green. So the NTPC Green will be housing some projects on its balance sheet and some through subsidiaries and JVs. So that’s how NTPC Green would be.
Apoorva Bahadur — Investec — Analyst
Okay. So the entire portfolio will be monetized basically?
Jaikumar Srinivasan — Director, Finance
Yes, that will include — no, the portfolio will be monetized at NTPC Green. All this hydrogen and storage and all will also come under NTPC Green either through subsidiary or JVs.
Apoorva Bahadur — Investec — Analyst
Fair enough, sir. Sir, last question, if I may, and this is more so on the bookkeeping side. I missed our capex numbers for H1 FY ’23. And if you can also share for ’23, ’24 and ’25 guidance, that will be very helpful, sir.
Ujjwal Bhattacharya — Director, Projects
On the capex side, as Director of Finance has already informed, we have reached already INR16,600 crore already. And our target this year is about of around INR27,500 crores, right? For next year, we are on the drawing board because some of the new projects are being added from the solar side. But I can give you a flavor that NTPC stand-alone plus NTPC Group companies, the capex next year will also be of the order of INR25,000 crore to INR26,000 crores taken together.
Apoorva Bahadur — Investec — Analyst
Sir, similar number for ’25 as well?
Ujjwal Bhattacharya — Director, Projects
Yes. For year after that, as I told that our capacity addition plan is more or less of the same nature, and we’ll be adding progressively a bit more of renewable. The capex side, the total amount might slightly come down, but we’ll be maintaining anything beyond INR20,000 crores year-on-year and in the foreseeable future. Additionally, we are to add new coal capacity, you must be knowing that we have already awarded Talcher Thermal Power Project, 2×660 megawatts, which itself will be around INR10,000 crores project. And we are going to award another three to four projects very soon. So that will bring a lot of capex into NTPC capex expenditure time line wise. And these projects will be completed by 2028 to ’29. If I take of the order of say INR40,000 crores to INR50,000 crores expenditure for these coal power projects that from ’25 to ’29-’30, we can split at around INR12,000 crores per year on the coal power project, total cost wise.
Apoorva Bahadur — Investec — Analyst
Sir, can you please share some details on the three to four projects, which ones and what capacity and by when will these be awarded?
Ujjwal Bhattacharya — Director, Projects
See Talcher, 2×660 megawatts we have already awarded to BHEL last month. Next is in our target, we are going to come with NIT for Lara expansion, which will be 2×800 megawatts. And we are working on three other projects, which are at different stages of planning and development. One is Sipat, 1×800 megawatts, second is Singrauli, 2×800 megawatt, and third is Darlipali, 1×800 megawatts.
Operator
We have the next question from the line of Nikhil Abhyankar from DAM Capital. Please go ahead.
Nikhil Abhyankar — DAM Capital — Analyst
Thank you sir. Thanks for the opportunity. Just to add to the previous question. Sir, you have just mentioned that we have Lara 1,600 megawatts and around 3.2 gigawatts three other projects. So can you just give us a time line of the ordering for these projects year-wise? Say, FY ’23, we have already done one. So will we have anything else and ’24, ’25 and so on?
Ujjwal Bhattacharya — Director, Projects
See, Lara, our target is to award by March 2023. And then our Sipat will be — you can say within Q2 of the next financial year, that is FY ’24. And then Singrauli and Sipat, both will come into FY ’25.
Nikhil Abhyankar — DAM Capital — Analyst
Sir, Darlipali will come when?
Ujjwal Bhattacharya — Director, Projects
Darlipali, there are some forest land issues which we’re settling. And once we settle, we’ll — we may bring it to FY ’24 itself if we can get the forest clearances. Otherwise, it will go to FY ’25.
Nikhil Abhyankar — DAM Capital — Analyst
So currently, coal capacity addition plan that we have in the pipeline is 4.8 gigawatts. Am I right?
Ujjwal Bhattacharya — Director, Projects
That is already decided by us.
Nikhil Abhyankar — DAM Capital — Analyst
Okay. And is there any chance that more such projects will be added?
Ujjwal Bhattacharya — Director, Projects
See, we are going by the requirement of the country and Government of India suggestions. And we have been told by the Government of India, which we discussed earlier also, of the order of 7,000 plus megawatt. We have identified many other projects. As we told during our Investor Conference, Mumbai, each of our existing projects has an expansion capacity. So adding 660 megawatt here or there can be possible. But large projects like Meja, for example, 2×660 megawatt is possible, then Telangana, 3×800 megawatt is possible. We are working on this some various points of view like coal availability, non-clearance, actual requirement in the grid. So we are a bit cautious, but we are steadily moving.
Nikhil Abhyankar — DAM Capital — Analyst
Understood, sir. And sir, also, can you just throw some light on the acquisition of Jhabua, once again like do we have any power tie up already there?
Jaikumar Srinivasan — Director, Finance
I’ll request Director, Commercial to speak on that. Jhabua?
Chandan Mondol — Director, Commercial
Yes, Jhabua, we have acquired along with — and we are having 65% stake on that. And already power is — most of the power is tied up and some power under Khavada [Phonetic] storage, we are selling in the market.
Nikhil Abhyankar — DAM Capital — Analyst
Okay. Sir, can you also just — you earlier mentioned there were associate companies. So can you just quantify those losses, Hindustan Urvarak and for Meja?
Jaikumar Srinivasan — Director, Finance
Losses? I think HURL, I don’t have the detail in front of me. I can’t have a guess, it is about INR700 crores to INR750 crores losses they have posted. And if we consider our 30% holding, then the loss is on the books of the HURL, not on NTPC. And if you ask for the reasons, they are same. The primary reason is that HURL, we have already commissioned the first unit. That is at Gorakhpur, first project rather out of the three projects, which are being developed. Each of the projects, Gorakhpur, Barauni and Sindri having a capacity of 12.6 lakh metric tonne capacity, right? And the Gorakhpur has come on stream on May 3, 2022. There are initial stabilization problem and there were some leakages in ammonia tank other things which has been set right. And we could achieve only 37% of the capacity till September 2022. But the good news — and that’s the reason why it has gone to a total of around INR715 crores of losses. But in October, our full capacity is INR1.05 crores, and we have already reached. So we have bounced back and if we can continue with the production at this rate, I think in this current year itself, we’ll be making it almost zero, zero.
Additionally, on the horizon, the Barauni will be commissioned sometime in December. We are looking for the MC of Barauni, maybe by 15th of November and MC of Sindri by, say, 15th of December. If that happens, then Barauni will come on stream as commercial sometime by 31st of December and Sindri by 31st of January. And hopefully, with initial treating problems within this financial year, next financial will be very good for HURL.
Nikhil Abhyankar — DAM Capital — Analyst
Understood. Thanks a lot and all the best.
Operator
Thank you. [Operator Instructions] We have the next question from the line of Atul Tiwari from Citigroup. Please go ahead.
Atul Tiwari — Citigroup — Analyst
Yes, sir. Thanks a lot opportunity. Sir, just one question on the average realization that has been disclosed at about INR4.7-odd. So there has been a very sharp increase of about INR0.85, INR0.90 over the past 6 months. So any particular reason for the…
Operator
Mr. Tiwari, I’m sorry to interrupt. We are not able to hear you properly. Can you please use your handset?
Atul Tiwari — Citigroup — Analyst
Yes. Sir, my question is on the average realizations, which have been disclosed. So there has been a very sharp increase over the past six, seven months in the average utilization. So is it all driven by imported coal? Or is there any other reason to it? And what is the proportion of imported coal that is being used?
Chandan Mondol — Director, Commercial
What is the sales you are selling or realization?
Atul Tiwari — Citigroup — Analyst
Realization. Realization.
Chandan Mondol — Director, Commercial
There is no linkage between realization and imported coal. Due to imported coal, sales have increased definitely. But as far as realization is concerned, we will be realized 100%.
Atul Tiwari — Citigroup — Analyst
So sir, average tariff, as disclosed in the Item G in the key metrics that you disclosed for the first half is INR4.77. And last year, it was INR3.86. So there is a jump of about INR0.91.
Chandan Mondol — Director, Commercial
Understood. It is all because of this imported coal.
Atul Tiwari — Citigroup — Analyst
Okay. And what proportion of the coal use is imported coal in this period?
Chandan Mondol — Director, Commercial
We are blending around 7.9% in the first year. We have blended in the first year.
Atul Tiwari — Citigroup — Analyst
Okay. And that is likely to continue for some time or that is coming off with the improvement in the availability?
Chandan Mondol — Director, Commercial
Right now, right as of today, the blending is only 3%.
Atul Tiwari — Citigroup — Analyst
Okay. So these tariffs will come off. And sir, my second question is on the Talcher orders.
Chandan Mondol — Director, Commercial
As the domestic coal situation increases, blending proportion will obviously come down. And in this Q3, the coal received would be more. So therefore, the blending requirement will come down. So hopefully, there should not be much of blending in the remaining half year.
Atul Tiwari — Citigroup — Analyst
Okay. And sir, my second question is on the Talcher project now that the order has been given. So what is the size of the order? And could you give some idea about when we can expect the commissioning of it? What are the time lines of execution?
Jaikumar Srinivasan — Director, Finance
See, size of the order has given to BHEL with GST is of the order of INR8,200 crores — I don’t exactly remember the number, INR8,200 crores. Anyway, and this is to be commissioned the first unit in 48 months from the date of award and second is within six months thereafter. So if you go by that ’22, that is ’26. ’26 August the first unit will be onstream. And within that financial year itself, ’26-’27, the project will be completed.
Atul Tiwari — Citigroup — Analyst
Okay. So INR8,200 crores, you said, the size of the order, right?
Jaikumar Srinivasan — Director, Finance
That is the EPC, plus/minus some crores. I’ll give you the exact number, Aditya will give you exact number. But then this is the EPC only. We have some other elements which is not part of the EPC, like the railway siding, the mega water pump and also ash disposal system outside the boundary. We are planning to use mine wipe. So those parts are not included here, which will go for different small, small packages and we’ll award. Our estimate is the project cost would be of the order of INR11,000 crores, including IGC and all the elements.
Atul Tiwari — Citigroup — Analyst
Okay sir. Thank you. Thanks a lot.
Operator
Thank you. We have the next question from the line of Kirthi Jain from Canara HSBC. Please go ahead.
Kirthi Jain — Canara HSBC — Analyst
Sir, with regard to this joint venture, last year, we made a profit of INR1,000 crores. When things normalize with this Meja stabilizing in and this fertilizer units at HURL getting normalized, what is the likely profit we can see a contribution from this joint venture, sir?
Jaikumar Srinivasan — Director, Finance
See if you look at the contribution from profits of the subsidiaries, it was INR867 crores from subsidiaries and INR120 crores from your joint ventures, around INR980 crores. However, if things stabilizes, we expect that it will — the losses which we are seeing here to the order of around INR300 crores that will come down and probably they’ll start making some profit. So you can expect profits to go up by around INR400 crores to INR450 crores.
Kirthi Jain — Canara HSBC — Analyst
So we will — from this INR980 crore level, we can go to INR1,500 crores run rate, sir?
Jaikumar Srinivasan — Director, Finance
On a half yearly basis, so you can double it up for a year.
Kirthi Jain — Canara HSBC — Analyst
Sorry. So half yearly we will see INR500 crore increase, sir?
Jaikumar Srinivasan — Director, Finance
Sorry?
Kirthi Jain — Canara HSBC — Analyst
No, no, sir. On a half yearly basis, we used to do INR500 crores. That will go to INR1,000 crores or how we should see, sir?
Jaikumar Srinivasan — Director, Finance
No, I am saying that INR545 crores, INR540 crores to INR550 crores was there in Q2 and INR867 crores was in the half yearly basis as far as the subsidiaries are concerned. However, as far as the joint venture is concerned which used to be [Technical Issues] around INR1,377 crores was the profit from subsidiaries for the last year, full financial year ’21-’22. And another INR1,000 crores was from the joint ventures. So with these things stabilizing, we are expecting that there will be some INR500 crores increase in the profits.
Kirthi Jain — Canara HSBC — Analyst
Sure, sir. Sir, my second question is with regard to this late payment scheme getting implemented with DISCOMs not allowed to have overdues. How will our receivables shape up? And also, like, sir, with regard to the long-term receivables, how much rundown will happen on a yearly basis, can you guide, sir?
Jaikumar Srinivasan — Director, Finance
I think we have securitized INR6,100 crores. And monthly, we are getting an installment of INR218 crores.
Kirthi Jain — Canara HSBC — Analyst
Okay. And sir, going forward…
Jaikumar Srinivasan — Director, Finance
Regularly we are receiving that.
Kirthi Jain — Canara HSBC — Analyst
Sir, going forward, our receivable days will be in the vicinity of 50 days, 60 days, sir? Or how it will be?
Jaikumar Srinivasan — Director, Finance
It will be less than that. It will be less than 45 days.
Kirthi Jain — Canara HSBC — Analyst
Sure. Thanks sir. Thanks a lot sir.
Operator
Thank you. Ladies and gentlemen, this would be the last question for today, which is from the line of Bharani Vijaykumar from Spark Capital. Please go ahead.
Bharani Vijaykumar — Spark Capital — Analyst
Yes. Good evening sir. What is the portfolio size in terms of gigawatt that would be monetized by December that you mentioned at the NVVN level?
Chandan Mondol — Director, Commercial
Can you repeat your question?
Bharani Vijaykumar — Spark Capital — Analyst
What is the portfolio size of renewable projects in gigawatts that would be monetized?
Chandan Mondol — Director, Commercial
No, it is not dependent on the portfolio. We are basically we are diluting the equity. Entire RE assets will be with the NTPC Green Energy Limited. And even NTPC RE, NREL also will be under this company, and we have diluted the stake of NGEL to the extent of maximum 20%.
Bharani Vijaykumar — Spark Capital — Analyst
Sure. So then given — there would be inclusion of hydrogen, the storage projects etc also…
Chandan Mondol — Director, Commercial
All grid portfolio will be under this.
Jaikumar Srinivasan — Director, Finance
So instead of monetization of specific assets, it is a stake sale in the Green Energy Company.
Bharani Vijaykumar — Spark Capital — Analyst
Correct. So the question is what is the size of portfolio considered when valuing for the stake sale?
Chandan Mondol — Director, Commercial
NTPC plan to add 60 gigawatt by 2032. So right now I think we are having only operating unit how much?
Jaikumar Srinivasan — Director, Finance
Currently what we’re looking at is that we’ll transfer 2,800-odd megawatts of capacity, and it also comes from NTPC Renewables, which is working on close to another 4,000 megawatts. So that’s the number which we are looking at immediately if that’s the question. But I have already mentioned earlier, our entire green portfolio of NTPC on a long-term basis will now be consolidated under NTPC portfolio. That is a 60-gigawatt number by 2030.
Bharani Vijaykumar — Spark Capital — Analyst
Correct, sir. My only question is, if the valuation includes the existing operational portfolio of about, say, 2 plus 7 or 8, that will give a different value. While if you have a valuation for 60 gigawatt, that will give us different value for the equity investor. So that is what I was trying to understand what would be that size that the equity investor is looking at?
Jaikumar Srinivasan — Director, Finance
So it is something which I cannot be debating with you in any case. They are for the potential investors to decide what we are showcasing to them through the VDR is separate issue. And probably it’s not right for me to discuss all those details here.
Bharani Vijaykumar — Spark Capital — Analyst
Sure. So that detail would be out after this deal is over by December?
Jaikumar Srinivasan — Director, Finance
Let’s see. Let the deal happen first.
Bharani Vijaykumar — Spark Capital — Analyst
Okay that’s it from my side. Thank you and all the best.
Operator
Sir, we have two more participants who are waiting in the queue. Can we take those questions?
Jaikumar Srinivasan — Director, Finance
Of course.
Operator
We have the next question from the line of Anup Goswami from B&K Securities. Please go ahead.
Anup Goswami — B&K Securities — Analyst
My first question is on the monetization of this. So right now, we have about 2.8 gigawatts that we — and it includes the potential work that is going on in the hydro and the storage and on the battery level. Is it very prudent to dilute about 20% right now rather than having a little significant portion of the work done and then going for it? Because the valuation can vary accordingly. So what is the thought process behind this? Why was the monetization needed so early?
Jaikumar Srinivasan — Director, Finance
Well, we have a mandate from Government of India to go for monetization. So we are going for monetization. But as far as the quantum of monetization is concerned, we plan to go up to 20%. So it will be less, but there is maximum ceiling of 20%. It will all depend on what is the valuation we are taking from the prospective investor. So based on that we’ll [Technical Issues] The quantum what we’ll offer has also got to do with — I mean how much is the interest that the prospective investor relevance, isn’t it? So we’ll take a call on that as we go ahead.
Ujjwal Bhattacharya — Director, Projects
Also let me chip in. You have a very interesting question you have raised there, which is a very strategic question. But the issue is whether we disinvest 10% or 15%, the future projects will be developed for which he is also going to invest money, not me alone. So if valuation in future will take care of that investment, which is, in any case, inventory, apart from the upside that he has projected. That’s why you have already indicated 60 gigawatt as our aspirational portfolio. I think that gives a reason for us to look for 10% to 20%.
Operator
Thank you. We have the next question from the line of Koundinya Nimmagadda from JPMorgan. Please go ahead.
Koundinya Nimmagadda — JPMorgan — Analyst
Yes. Hi sir. Thanks for the opportunity. Just one question from my end. If I look at the under-recovery number you quoted around INR700 crores. It was around INR500 crores, if I remember correctly, in June. So just trying to understand what led to this increase per se? And what is the quantum of fuel cost under-recovery in any within this?
Ujjwal Bhattacharya — Director, Projects
See the increase because of the — some of the units that we have taken for overhauling due to the increased work the overall duration has increased. So going forward, as our Director, Finance has said, by the end of the year, most of this will be recovered. The projected under-recovery by the end of the year is only INR250 crores, that too mainly in only four stations where we had a major equipment issues. The remaining under-recovery will be recovered.
Koundinya Nimmagadda — JPMorgan — Analyst
Okay. So in that case, there is no fuel cost under recovery, if I’m understanding this correctly?
Ujjwal Bhattacharya — Director, Projects
There is no fuel cost under-recovery.
Koundinya Nimmagadda — JPMorgan — Analyst
Sir, secondly, even if I add back this under-recovery number and look at the implied ROE, that looks quite lot around 13.5%, 14%. So how should we read that?
Jaikumar Srinivasan — Director, Finance
Can you repeat your question?
Koundinya Nimmagadda — JPMorgan — Analyst
Sir, I was trying to just add back the under recovery to look at the implied core ROE. Even that number looks somewhere close to 13.5%, 14%. So just trying to understand how to read that number or if I’m missing something over here?
Jaikumar Srinivasan — Director, Finance
I did not follow. If you’re adding this under-recovery to the PAT, you are getting a return of 14% on equity. This is what you are saying?
Koundinya Nimmagadda — JPMorgan — Analyst
Core ROE, yes, the core ROE number. So just trying to understand if I’m missing something out here.
Jaikumar Srinivasan — Director, Finance
Cannot add to the PAT. Of course, see, broadly your approach is correct. But then there will be some — there is an element of discounting which we have done. That, as we go ahead, that will be progressively be unwinded.
Operator
As there are no further questions from the participants, I would now like to hand the conference over to the management for closing comments.
Ujjwal Bhattacharya — Director, Projects
Okay. Before Director, Finance gives you the closing comments, let me add one news to all of you that as you must be knowing that on the capex side, we are progressing very fast. All the FGD projects are coming at different stages of completion, and we’ll be investing a lot in the capex. On the fund side, we are going to add as we have explained. We’re also looking at various options in terms of further capacity addition for which different types of funding is on the board, including RE. So that way, the capex is only going to shoot up. And according to the future of the company, is going to look brighter. DF, sir?
Jaikumar Srinivasan — Director, Finance
Yes. So on behalf of the management, I thank all the participants for attending this conference call. Some of the details which we said that we can give it separately, you can feel free to call us and get those details. And I also would like to thank Rahul Modi from ICICI Securities for organizing this. Thanks a lot.
Operator
[Operator Closing Remarks]