Tata Power Company Limited (TATAPOWER) Q2 FY23 Earnings Concall Transcript

Tata Power Company Limited (NSE:TATAPOWER) Q2 FY23 Earnings Concall dated Oct. 28, 2022

Corporate Participants:

Praveer Sinha — Managing Director & Chief Executive Officer

Sanjeev Churiwala — Chief Financial Officer

Analysts:

Mohit Kumar — DAM Capital Advisors Limited — Analyst

Swarnim Maheshwari — Edelweiss Group — Analyst

Dhruv Muchhal — HDFC Asset Management Company Ltd. — Analyst

Abhineet Anand — Emkay Global Financial Services Ltd. — Analyst

Sumit Kishore — Axis Capital Limited — AnalystKoundinya Nimmagadda — J.P. Morgan — Analyst

Aniket Mittal — SBI Mutual Fund — Analyst

Apoorva Bahadur — Investec — Analyst

Analyst — — Analyst

Ajay Mehta — Wipro Limited — Analyst

Bharanidhar Vijayakumar — Spark Capital Advisors (India) Private Limited — Analyst

Presentation:

Operator

Ladies and gentlemen, good day, and welcome to the Tata Power Q2 FY ’23 Earnings Conference Call. [Operator Instructions] Please note that this is conference is being recorded.

Today, we have Tata Power management team on the call with us. I now hand the conference over to Dr. Praveer Sinha, CEO and MD of Tata Power. Thank you, and over to you, Dr. Sinha.

Praveer Sinha — Managing Director & Chief Executive Officer

Thank you very much, and good evening to everyone and thanks for joining for the Q2 analysts call. On behalf of Tata Power, I would like to wish all of you a very Happy Diwali and also my best wishes for the festive season. Today in the call, I’m joined by my colleagues Sanjeev Churiwala, CFO; Jinendra Patil, Financial Controller; Kasturi and Rajesh Lachhani from the Investor Relations and few others colleagues from bank financing team.

Let me first of all start with giving you you some background about the consumption of power in the country.

What we have seen in last six months is that there has been a huge increase in the requirement of power. The peak power went and touched something like 207 to 209 gigawatt. And also, in terms of energy, the increase has been nearly 12% in the last six months. Of course, in the last quarter, the demand was little subdued because of extended monsoon, which actually went right up through September and even in October. This also was a period when we saw that during the month of especially April and May, there was a shortage of coal and during that period, the peak prices of power went up in the exchange. Since then, there have been much lower peak prices, and also there is a capping of peak price that has been a bit later.

During this period, Tata Power has done exceedingly well. In the last quarter, our PAT has grown, and also our revenue has grown and EBITDA has grown. In this quarter, our PAT has grown by nearly 49% — sorry by 85% from INR506 crores last year to INR935 crores. Revenue has grown by 49% from INR9,502 crores to INR14,163 crores and our EBITDA has grown by 18% from INR1,732 crores to INR2,043 crores.

If we look at the H1 data also, we find that in our — in H1 also, like the quarter, the PAT has grown by 87% from INR971 crores to INR1,819 crores. The revenue has grown by 49% from INR19,076 crores to INR28,939 crores and the EBITDA has grown by 1% from INR4,097 crores to INR4,150 crores. This growth has been on back off excellent performance by all our businesses, our existing integration business, hydro business, coal business, all of them have done very well. Our coal mines have also done exceedingly well on back of high prices of coal.

Mundra, we have been able to operate the plant under Section 11, and the interim order of the regulator has ensured that we give the full fixed cost, and also states who were not scheduling the power has to pay the fixed cost as we have shown the eligibility of the plant. And now, we are of course expecting the order on the full pass-through of coal cost, which give us a further improvement in our performance in the subsequent quarter.

We have also seen all our other businesses doing very well. Our renewable capacity today, the utility-scale is something like 5,660 megawatt on back of the 850 megawatts of projects that were won in the last quarter. This includes 3,870 megawatt of operating plants and another 1,790 megawatt of projects, which are under different stages of utility scale. We expect that in coming years, with the type of increases — improvements that we have seen in our hit rate in winning projects, we will be able to add large quantity of such big projects in different parts of the country and this will not only be just pure solar or pure wind but will be hybrid projects also.

We also won projects through the — under the EPC Group, where we won projects of 125 megawatt from NHDC and 100 megawatt from SJVN and we implemented during this period, 625 megawatts of third-party EPC projects also. We have a very healthy order book of nearly 3,800 megawatt with the value of nearly INR15,000 crores. Our 4 gigawatts manufacturing facility is doing well. The work has started at site and parking of many equipments have taken place, and we expect to roll out of the first of the volume from the plant by next year July, August, and the 1st of — by next year December. So that will help us in meeting our future requirement of sales and volumes for our projects, and also for the EPC projects and Rooftop projects.

In the Rooftop business, we commissioned 138 megawatt of capacity during this period and we also won 313 megawatt of orders totaling to INR1,233 crores. With this, our presence in more than 265 districts of the country have happened, and more than 100 cities, and we expected that with our present order book of nearly 400 megawatt with a value of nearly INR1,500 crores, we’ll be able to grow this business many more times than what we had done in the previous year and quarters. We already have accumulated Rooftop portfolio of about 11,150 megawatt, and this keeps on increasing every month and every quarter.

In the Solar Pump business, we installed nearly 6,000 pumps in Q2, taking our total installations to 17,000 pumps and we expect that with more than 80,000 pumps across India, we’ll have a major presence in most of the states in the country. On the e-mobility, we added 722 public chargers and we have now more than 3,000 public chargers in different parts of the country including highways and we have nearly 23,000 home chargers. Apart from this, we have about 240 bus chargers in different cities in the country.

The transmission and distribution continues to be very steady and have been great at a very fast pace. During the quarter, we took over the South East UP Power Transmission Company, the isolated company who is the resurging platform. And also worked on the NRSS XXXVI Transmission project have started, and we expect that we will be able to complete all these projects in the next six-month to 12-month progress only in these locations.

Also, we have been able to push our smart meter initiative, and we have nearly INR4 lakh smart meter installed in Delhi, Mumbai, and in different parts of Odisha, and we expect that soon we will be able to cover in the next three years virtually all our customers in this places. Our distribution business in Odisha which we took over progressively in last two years has done exceedingly well. We are been able to not only reduce the AT&C losses to a very large extent but have been able to also improve the reliability and customer connect and excellent service is being provided to our customers, many of the legacy issue over there have been sorted out.

There were nearly 20 lakh meters that we replaced, which were not working, and all were the legacy meters, the electromechanical meters. And that has helped us in improving the billing efficiency and also giving the correct consumption that is being done by the consumers there. And the results of that are coming in the subsequent quarters.

Moving to our balance sheet, we have been able to ensure that our net debt continues to be less than INR40,000 crores. It’s about INR39,000-odd crores and this is in spite of the fact that we have done more than INR3,000 crores of capital investment in this year. Our working capital also has improved because of better collections in all our businesses including renewal business and we have started getting the money from some of the states which earlier were delaying the payment and we do expect that all the old outstanding we get liquidated in next few quarters.

Our net debt to underlying EBITDA has improved from 3.6 in last quarter to 3.5 in this quarter. Similarly, our net debt to equity has also improved from 1.55 to 1.32 and we expect that going forward, we’ll be able to maintain at these level, notwithstanding the fact that there is large amount of capex that has been planned in renewable transmission and distribution business. As I’ve been mentioning earlier, Tata Power has been continuing towards a long-term aspiration and the 12th consecutive quarter of good performance shows that a huge amount of foundational changes have happened, which is ensuring that the sustained performance and results have been provided and I think the directional change that we have seen will help us to further improve in the coming quarters.

So, we will — we have of course shared with you the detailed depth of our quarterly result and I now look forward to have your question and the floor is now opened for Q&A.

Questions and Answers:

Operator

Thank you. [Operator Instruction] The first question is from the line of Mohit Kumar from DAM Capital. Kindly proceed.

Mohit Kumar — DAM Capital Advisors Limited — Analyst

Yeah, good evening, sir, and congrats on good set of numbers. So my first question is on the Mundra short-term arrangement. Is it being extended post 31st October, 2022. Have you heard anything from the government? And secondly, are you booking the tariff completely on cost plus for the quarter? Or is there something which is still being pursued at CERC?

Praveer Sinha — Managing Director & Chief Executive Officer

So thank you, Mohit. First of all the existing arrangement has been extended up to 31st December and we’re not sure whether it will get further extended but the supply under Section 11. And I’ll continue it up to 31st December. Secondly, right now we booked the Mundra tariff based on what Ministry of Power has given as a interim tariff. The difference between the interim and the actual tariff that is to be decided by CERC as we have shared with you earlier under Section 11 any generation has to be on a cost-plus basis.

That means actual cost that you have incurred will be paid to you, and that was the principal on which even the interim order of CERC came whereby, they give us the full charge for capacity which is INR0.90 and no deduction was announced, and also of states which were not scheduling power they have to pay because we were showing the availability. So, the Section 11 principal is very well laid out and we expect that once the final order comes, a full pass-through of coal will be given to us.

Mohit Kumar — DAM Capital Advisors Limited — Analyst

Understood, sir. Secondly the — what is the status of Mundra long-term draft supplementary power purchase agreement, where are we right now? And when do you think we were able to resolve this entire thing?

Praveer Sinha — Managing Director & Chief Executive Officer

So, since the existing arrangement is going on. Gujarat Government has been going little slow on finalizing the Mundra arrangement. So let’s wait and watch if the existing arrangement continuous and this provides us the opportunity to do the supply of power on cost-plus basis or if that does not get extended, then of course the Gujrat Government would come forward and finalize an arrangement which is acceptable to both sides. So I think for the present, we will continue with the existing arrangement, and if there is something that will require we will discuss and mutually sort it out.

Mohit Kumar — DAM Capital Advisors Limited — Analyst

Understood, sir, thank you, and best of luck, sir, thank you.

Operator

Thank you. The next question is from the line of Swarnim Maheshwari from Edelweiss. Kindly proceed.

Swarnim Maheshwari — Edelweiss Group — Analyst

Yeah, hello sir, good evening. Thanks for the opportunity. Sir, my first question is, during the quarter in Mundra was there any reversal of excessive provision because posted tariff orders which get — actually which got affected from 5th of May, before that for about 30, 35 days you were outside the Section 11. So, post this tariff order is there any excess provision that has been reversed during the quarter?

Praveer Sinha — Managing Director & Chief Executive Officer

See, what had happened when this main notification came it talked about that the fixed costs of the capacity charge will be paid, as per the PPO or if there is any agreement, since there was no agreement, but notwithstanding that Gujrat was only paying as access INR0.70 not the full amount because they were considering that the interim arrangement that we were trying to sort it out with them, the rebait will be given. But the interim order of CERC mentioned that full fixed cost of capacity charge has actually given. So, that reversal has happened in the quarter, but other than that we have not done any numbers.

Swarnim Maheshwari — Edelweiss Group — Analyst

Yeah, sir, what is that amount, sir? If you can quantify please?

Praveer Sinha — Managing Director & Chief Executive Officer

So, it’s a INR0.20 paisa per unit of whatever we have supplied to Gujrat and Maharashtra that has been — and to the other states, they have to pay the full fixed cost even if they’re not scheduling the power.

Sanjeev Churiwala — Chief Financial Officer

Yeah, and it’s also that if you see the most of accounts where you have reinspecified to break up amount, including amount that have been into the previous period. In the total amount that we have been able to recognize is INR461 crores and out of that INR151 crores pertains to the previous quarter.

Swarnim Maheshwari — Edelweiss Group — Analyst

Okay. Fair enough sir, fair enough. Sir my second question was on the receivables side. So you did mention, we expect to see some sort of liquidation in the ensuing quarters, but this is for the second consecutive quarter we have seen that the receivables have been a bit elevated. So any specific reasons? I understand this is from the likes of Odisha and Mundra, but any specific thing that you would want to highlight that is it some sort of a sticky issue somewhere?

Sanjeev Churiwala — Chief Financial Officer

So. I think — can I answer that?

Praveer Sinha — Managing Director & Chief Executive Officer

Yeah, yeah.

Sanjeev Churiwala — Chief Financial Officer

So I think couple of things that actually predicted right, given that the energy costs have gone up and to the extent the revenues are high, the receivables would also be high, but that doesn’t mean the quality of our receivables have reiterated. In fact, the overall quarter, it has gone up. So in terms of our receivable days, yes, absolutely well within control.

The good part is many of sticky receivables that we were discussing in the past, for example, Andhra Pradesh and other places, they have now started paying us in installment including all the disputed amount. So, we would see quite a good reacquisition happening in the subsequent quarters coming in. Similarly in Mumbai, where they were delaying payment, now they also started paying, as you’ll see that the liquidation also happening in the subsequent three to four months. So I think overall receivables is absolutely within control and on that as per the plan.

Swarnim Maheshwari — Edelweiss Group — Analyst

Fair enough, sir. Got it, thank you so much. Wish you all the best, I’ll get back in queue.

Operator

Thank you. [Operator Instructions] The next question is from the line of Sumit Kishore from Axis Capital. Kindly proceed.

Hello, Mr. Sumit Kishore. Sumit Kishore are you able to hear us? So, there is no response from the line.

[Operator Instructions] The next question is from the line of Dhruv Muchhal from HDFC. Kindly proceed.

Dhruv Muchhal — HDFC Asset Management Company Ltd. — Analyst

Yeah, sir, thank you so much. Sir, you mentioned that there is a gap between the interim tariff and the final tariff based on the full fuel cost pass-through mechanism under Section 11. Possible to share what the gap is? But please help us understand the potential benefit that is likely to approve.

Praveer Sinha — Managing Director & Chief Executive Officer

Right now, it will be a little premature, we’ll share with you in such time, the final order of CERC comes, we do not know exactly what will ultimately get approved by them. So let’s wait for their order. We expect that order to come in November and then, we’ll be able to work out the exact quantum mentioned.

Sanjeev Churiwala — Chief Financial Officer

Yeah. And to add to Dr. Sinha, I think our apologies again since there is lot of discussion in quarter one, that in our existing debt, we’re not giving the separate breakup for coal our profit and end user profit. And we did mentioned over there that time there are certain discussions, which is under progress, both at the CERC level and as well which we’ve have been in. And we do not want to run or get into a dispute by putting a certain amount. The good part is as we had mentioned last time that we will see some drawback happening in quarter two, which has not happened, the amount of INR461 crores that we mentioned. We are kind of also expecting that depending on what the kind of order we get, good material amount should come and hit our bottom line positively in quarter three, but at this moment as Dr. Sinha said, we are not in a position to show you the exact breakouts.

Praveer Sinha — Managing Director & Chief Executive Officer

Mr. Anand, does that answer your question?

Sanjeev Churiwala — Chief Financial Officer

No. I think it was Dhruv, who was asking the question — asked that question — I don’t know, Dhruv is out?

Dhruv Muchhal — HDFC Asset Management Company Ltd. — Analyst

Thank you. Got the answer.

Operator

Thank you, sir. The next question is from the line of Abhineet Anand from Emkay Global. Kindly proceed.

Abhineet Anand — Emkay Global Financial Services Ltd. — Analyst

Yeah. Thanks for the opportunity. On the solar EPC side, the order book is quite healthy, which is vital. Just wanted to understand in the last few months or maybe in the last few quarters, have you see an increased competition? We saw major number of contracts that Tata Power won earlier was from state PSUs like NTPC, SJVN and all. Recently, we saw one of your competitors winning a large project in excess of INR2,000 crores and they have now backing of large corporate, so any increased competition that you see in this space?

Sanjeev Churiwala — Chief Financial Officer

I think the players are the same. Only thing is what we are seeing is that the basis are coming either much higher rates unlike earlier when it went up to INR1.99 and INR2. They are now all in the range of INR2.50 to INR3 depending on the location of the plant and whether the land is being given and what sort of profile of generation that is required. So I think there is much more seriousness and credibility that is coming in — within process, rather than many who are covering and bidding number, which they were finding it difficult to raise.

Abhineet Anand — Emkay Global Financial Services Ltd. — Analyst

Okay. Secondly, I understand that — obviously Mundra has been merged, is it possible to give some ballpark number what has been the performance of Mundra for either 1S or Q2?

Sanjeev Churiwala — Chief Financial Officer

We are not giving a separate breakup here. I think it’s kind of all will merge in overall generation business, but as I mentioned earlier, definitely a lot is kind of partly covered because of the tariff that we received. The INR462 crores program that they did and of course the difference between what has been allowed at the tariff and what is expected tariff is still in the CERC. So once we get a clarity on that, we will have some better understanding of the Mundra coal mines. For us, both of them are clubbed into one, because its made for each other.

Abhineet Anand — Emkay Global Financial Services Ltd. — Analyst

Okay. And I’m just assuming that Sinar also told that this arrangement is due in 3Q, niche plant let’s assume in affidavit is going to continue and your long term arrangement that you were talking about still takes some time. I mean, what’s the larger — I mean — picture that we can understand on Mundra event?

Praveer Sinha — Managing Director & Chief Executive Officer

What we need to understand is, that even with the present pass through cost still very competitive in Gujrat and so they will definitely like to schedule power from this plant compared to many others who are at a much higher prices. Secondly, once these rituals are being laid in the CERC order and all, so hopefully, around that only the final discussion and negotiation will take place, but it will not be on the principle, which will be very different than what is decided by CERC. So that’s what is our expectation.

Abhineet Anand — Emkay Global Financial Services Ltd. — Analyst

And broadly the principle is near about the cost, right?

Praveer Sinha — Managing Director & Chief Executive Officer

Yes. Absolutely right.

Abhineet Anand — Emkay Global Financial Services Ltd. — Analyst

Okay sir. Thanks. Those were the questions.

Operator

Thank you. The next question is from the line of Sumit Kishore from Axis Capital. Kindly proceed.

Sumit Kishore — Axis Capital Limited — Analyst

Thanks for the opportunity. My first question is that, net cash flow from operating activities at consolidated level has reduced from INR2000 crores in H1 FY ’22 to INR2,138 crores in H1 FY ’23, if I look at the BSC filing. What qualitatively explains the decline in net cash flow from operating activities even the reverence count P&L performance.

Sanjeev Churiwala — Chief Financial Officer

Are you taking about the cashflow from operating activities?

Sumit Kishore — Axis Capital Limited — Analyst

Yes. At the consolidated level. H1 FY ’23 compared with H1 FY ’22.

Sanjeev Churiwala — Chief Financial Officer

Yeah. I think if you look at the particular sheet, which is the complete long page have the complete variant analysis and there are items which is moving up and down that we have. By and large from INR2,400 crores that we seen in ’21 to almost INR2,200 crores. For this size of the business, there will be small items going up here and there, but we don’t see any significant change in the trend.

Sumit Kishore — Axis Capital Limited — Analyst

Right. I mean, I simply asked this question, actually a lot of moving parts, it’s just difficult to define sir, because there are regulatory for assets also singing, but obviously the P&L growth has been quite strong in first half of the year thanks to the elevated coal price among other factors, but somehow the working capital since you have gone up even easily.

Sanjeev Churiwala — Chief Financial Officer

Yeah. So as I said earlier, working capital if you see, it’s important to link it with the growth in the revenue, because at various locations, we will have credit period and to that extent, our higher revenue leads to a higher trades receivables. With that kind of all good and not overly in the sense. So I think that there’ll be higher working capital linked to a higher revenue, but in terms of the overall aging of our data, our DSOs, those are all within control.

Sumit Kishore — Axis Capital Limited — Analyst

Sure. My second question is in relation to Slide 18 of the presentation, where again Q2 FY ’23 EBITDA before elimination has gone up sequentially from quarter one, it’s gone up to INR3,022 crores from INR2,798 crores, however, the ratios have increased quite sharply, they are almost INR1,229 crores in Q2 versus INR691 crores in Q1. So when we look at the segment wise analysis and try to understand the performance, this elimination increase is simply too high and that is driving reduction in EBITDA on a sequential basis. So what’s in such a sharp eliminations?

Sanjeev Churiwala — Chief Financial Officer

Yes. This is basically on a consolidated basis. We have the dividend which will eliminated between the two company, right? So and of course that also reflect that we’ve received higher dividends to that extent that elimination is purely on account of dividends.

Sumit Kishore — Axis Capital Limited — Analyst

Okay. So that basically is a reflection of the higher dividends received from the coal mine?

Sanjeev Churiwala — Chief Financial Officer

Yes.

Sumit Kishore — Axis Capital Limited — Analyst

Right, right. And finally on Mundra, following the Section 11. What is the under recovery basis deal direct that you have charged so far? So what is it that you’re expecting from the regulator to get cost reflective tarriff?

Sanjeev Churiwala — Chief Financial Officer

Well, I think this is an indirect way of asking the same question. Given that we are already with the CRC the hearing has happened and we are expecting the outcome very soon. I think it’s better to wait for a couple of months so that we can give you a very precise answer.

Sumit Kishore — Axis Capital Limited — Analyst

Sure. Last question is on the solar EPC revenue and margins. So for both utility-scale solar and PPA solar pumps, the revenue seems to have come off fair bit year on year, margins in Q2 have gone up sharply on a sequential basis. If you could please help with the — what explains this volatility?

Praveer Sinha — Managing Director & Chief Executive Officer

Yes. I think your observation is absolutely correct and I think this goes back to the quarter one conversation where under EPC we had negative PAT margin. We kind of went back to the drawing board to see how buyback our profits. So a couple of things that we have done is, A, some of the projects which was kind of dragging down our profitability, we have agreed with the parties from the vendors to kind of disperse those projects and take the benefit of reducing cell and module prices, as well as of course as you are aware, the chief sites has also came down and recognize [Indecipherable]

So that is one, and because some of the projects were deferred, we were able to re-estimate the cost to completion and this resulted in right back of some of those provisions that we are making. I think the better way to look at is — look at the H1 EBITDA margin in totality, which is kind of close to about 2%, ideally, I would like to have a higher PAT margin to empower but at least the situation has improved from where we were in quarter one.

Sumit Kishore — Axis Capital Limited — Analyst

Sure. Thank you so much for answering my questions. I wish you all the best.

Operator

Thank you. The next question is from the line of Koundinya N. from J.P. Morgan. Kindly proceed.

Koundinya Nimmagadda — J.P. Morgan — Analyst

Yeah. Hi sir, thanks for the opportunity. Couple of questions. Firstly on Mundra plant, sir just trying to understand if you look — I mean your — a bit of slowdown on the part of Gujrat Government tax paid resolution, is it got something to with subdue demand in government in the second quarter or how should we look at it?

Praveer Sinha — Managing Director & Chief Executive Officer

Subdued demand no? The demand was not due in Gujrat in fact we have been in three plants exclusively for Gujrat during this period, because their demand has been very much there and this is one of the big suppliers. In fact, in terms of single-plant, this is the largest supplier of power to Gujrat. And going forward also our confidence is that those section is running in only up to 31st December, they will continue to have a similar requirement in next year also in summer period and all. So they will definitely come to some arrangement and this plant will continue to supply and be one of the main suppliers of power too in the coming years.

Koundinya Nimmagadda — J.P. Morgan — Analyst

Okay. Sir other than Gujrat, are there any other state that are also asking for power. There was some media article quoting that Rajasthan was also looking to tap from Mundra plant. So just trying to understand that part.

Praveer Sinha — Managing Director & Chief Executive Officer

Apart from Gujarat, Maharashtra continues to take power, and also for certain period of time Rajasthan has taken, so these states have been regularly procuring power from Mundra.

Koundinya Nimmagadda — J.P. Morgan — Analyst

Understood. And sir, I think you expanded in previous quarters, but just trying to understand better, so can you help us understand what is the way that contract is being booked, I mean that tariffs are being booked at the moment from Mundra plant?

Praveer Sinha — Managing Director & Chief Executive Officer

So, right now, we have booked based on the full capacity charge and also whatever is the notified incurring tariff by Ministry of Power. So every two weeks they come up with the notification of these based on the cost of the ICIGB cost of coal and — but the final cost of coal will be whatever is the actual cost of coal that we have incurred of operating the plant.

Koundinya Nimmagadda — J.P. Morgan — Analyst

Thanks. Just clarifying on that second part, sir. So, essentially there is no under-recovery either on the fixed part or on the variable cost point. Is that understanding correct?

Praveer Sinha — Managing Director & Chief Executive Officer

So on fixed there is no difference, on the variable there is a difference right now on the — whatever is the interim notified price and the actual price. That difference calculations have been given to the CERC, that delta difference whatever is there and once CERC notifies it, we will confirm.

Koundinya Nimmagadda — J.P. Morgan — Analyst

Okay, got it. And secondly, bookkeeping, sir. What is the dividend amount from the subsidies to pairing total and first half? Can you provide that?

Sanjeev Churiwala — Chief Financial Officer

It’s about INR1,102 crores for the total.

Koundinya Nimmagadda — J.P. Morgan — Analyst

So, INR1,102 crores?

Sanjeev Churiwala — Chief Financial Officer

Yeah, that’s correct.

Koundinya Nimmagadda — J.P. Morgan — Analyst

This is for first half?

Sanjeev Churiwala — Chief Financial Officer

That is for quarter two and INR1,800 crore for H1 all put together.

Koundinya Nimmagadda — J.P. Morgan — Analyst

Okay, sure. Got it, sir. Thank you very much and all the best.

Operator

Thank you. The next question is from the line of Aniket Mittal from SBI Mutual Fund. Kindly proceed.

Aniket Mittal — SBI Mutual Fund — Analyst

Thank you for the opportunity. Few questions. Firstly on the EPC front. In Slide 9 of your presentation, you’ve mentioned that there had been some plant rescheduling of large projects on the EPC. So if you could elaborate on that and which are these large projects that have gotten re-scheduled?

Praveer Sinha — Managing Director & Chief Executive Officer

Yeah. This is a — we have one on one conversation with various parties, but I think it is suffice to say that some of the large projects have been rescheduled and of course with the consent of the parties to the extent that party also realize that, that the current elevated prices for sales and modules, it won’t be possible for many players or EPC players to deliver the project on time, and hence, they can mutually agreed.

Aniket Mittal — SBI Mutual Fund — Analyst

Okay. So, I were to look at your current order book of projects, INR15,000 crores, sir. How do I look at it from a execution timeline perspective? If you could give some color on that?

Sanjeev Churiwala — Chief Financial Officer

Execution is normally for any such EPC project given to third parties or in-house, it’s normally eight months, 12 months to 18 months but depending upon the kind of projects we are doing, the tenant, the period can differ, but on an average, you can presume about roughly 18 months.

Aniket Mittal — SBI Mutual Fund — Analyst

I am just trying to understand is there any delays or projects that have gotten stop because of this initiative?

Praveer Sinha — Managing Director & Chief Executive Officer

This is plan rescheduling that I was talking about.

Aniket Mittal — SBI Mutual Fund — Analyst

Okay. The other question is even when I look at the numbers for TERPL, there seems to be a very large swing on a Y-o-Y basis, I think against the profit of INR210 crores last year, there has been a loss of INR29 crores reported this year. So what’s the reason for that?

Sanjeev Churiwala — Chief Financial Officer

There was some one-time foreign exchange gain which was booked last year.

Praveer Sinha — Managing Director & Chief Executive Officer

INR200 crores, yes.

Aniket Mittal — SBI Mutual Fund — Analyst

Okay. It’s from the loss sir of INR29 crores?

Sanjeev Churiwala — Chief Financial Officer

Are you referring to Slide number 19 of the deck?

Aniket Mittal — SBI Mutual Fund — Analyst

Yes. Slide number 19 in the deck.

Sanjeev Churiwala — Chief Financial Officer

You’re looking at TERPL shipping company, right?

Aniket Mittal — SBI Mutual Fund — Analyst

Look at Slide 18 actually, I think. Slide 18, you’ll find the numbers for 2Q. It’s against INR214 crores of profit last year its coming at minus INR29 crores?

Sanjeev Churiwala — Chief Financial Officer

Yeah. So, we have booked at INR200 crores of forex gain last year for the same period. That was for trial off shipping that was done since that money was at that time passed in. When we brought it over here we booked at INR214 crores of forex.

Aniket Mittal — SBI Mutual Fund — Analyst

Is that related to sort of question on the EPC front. So when I look at the renewable capacity that we have under development which is I think 1.8 gigawatts. The commissioning timeline, could you help me on that? In terms of…

Praveer Sinha — Managing Director & Chief Executive Officer

Most of them are next 12 to 18 months. So our target is that by March 24, most of all of that will be March, that’s the time.

Aniket Mittal — SBI Mutual Fund — Analyst

Okay. How much do you plan to be in FY ’23? and how much in FY ’24?

Sanjeev Churiwala — Chief Financial Officer

We can share the detail. I don’t have it right now.

Praveer Sinha — Managing Director & Chief Executive Officer

Ballpark for the first H1, we have commissioned 450 megawatt. No, no that is our home loan which is…

Sanjeev Churiwala — Chief Financial Officer

Yes, the question was on — related thing?

Praveer Sinha — Managing Director & Chief Executive Officer

No, on the Total.

Sanjeev Churiwala — Chief Financial Officer

Total? That that will share with you sir quickly.

Aniket Mittal — SBI Mutual Fund — Analyst

Okay. Just one last question on Mundra and I understand you can’t talk about the difference or the under return, but could you help me what’s the average tariff that you’ve realized from Mundra for 2Q and 1H, that you’ve actually booked in your number?

Sanjeev Churiwala — Chief Financial Officer

INR5.50, INR5.75 around that but the notified tariffs have been between INR6.20 to INR4.80 or — that’s been notified, so that’s redundant.

Aniket Mittal — SBI Mutual Fund — Analyst

Sir you’ve booked around INR5.50 to INR5.70?

Sanjeev Churiwala — Chief Financial Officer

Yes.

Aniket Mittal — SBI Mutual Fund — Analyst

And this is for 2Q or this is for 1H?

Sanjeev Churiwala — Chief Financial Officer

Q2, because its not 1H fully. its only part of 1H.

Aniket Mittal — SBI Mutual Fund — Analyst

So, INR50 for 1H?

Sanjeev Churiwala — Chief Financial Officer

No, no not 550, You are mixing the other, see this full notification came from 5th of May. So it is not 1H it is only part of 1H.

Praveer Sinha — Managing Director & Chief Executive Officer

Okay. and part of which is restating and give me a break up because its completed now, and its better to wait for the complete clarity till March and I’m very sure that we’ll connect for the call, we’ll have a complete idea as to the exact recovery or that be loosing or gaining.

Aniket Mittal — SBI Mutual Fund — Analyst

Okay, I’ll move, that was it, thank you, that was my question.

Operator

The next question is from the line of Apoorva Bahadur from Investec. Kindly proceed.

Apoorva Bahadur — Investec — Analyst

Hi, there. Congratulations on the good set of numbers and thank you for the opportunity. Sir you spoke on this provision guide back for the solar — can you please share the quantum, how much did we write back and just sort of.

Sanjeev Churiwala — Chief Financial Officer

We’ll be able to send you separately, because there are — many projects that losing the impact on account of various things. So basically, if just quantify one number and give it to you, — I think concisely, in the previous question that we depending upon the time of completion and then towards when the project is getting completed. We do a cost to completion and now on the conservative basis which are in that more provisions to be under safer side, so given that some of those projects have been rescheduled now, and then, the cost of sales modules see’s has coming down.

We have done a revaluation of the cost to completion and find that we will be in a position to claw back some of these provisions.

Apoorva Bahadur — Investec — Analyst

Okay sir. Sir, secondly on your the overall green company portfolio, while the profitability has been lower year on year. Now I understand that some part of it would be because of in our depreciation and rise in interest cost, but the EBITDA margins also are weak, especially for PRS. So can you share the breakup between this operational and the decline in profitability due to operational issues, and also the impact of high in our depreciation and interest costs will be there in portfolio?

Praveer Sinha — Managing Director & Chief Executive Officer

So we’ll share with you, see the — if you see our H1, the EBITDA has actually gone up and so — it also depends on what sort of wind speed and what sort of solar intensity is there. So in the first quarter we had very good wind speeds and there has solar intensity. In the second quarter because of the extended monsoon, the solar generation was there, but the details we can share with you. We can give you that how the same change has been.

Apoorva Bahadur — Investec — Analyst

Okay sir, it’ll be very helpful. Sir also I just wanted to check in this quarter, this next term Odisha DISCOMS numbers appear quite strong. So is there any one off or incentive that they have booked till the quarter?

Praveer Sinha — Managing Director & Chief Executive Officer

No, we have booked any incentives, performance has improved and the — I mentioned to you our AT&C losses has reduced our billing efficiency has improved our collection efficacy has improved. I think, it’s a general performance of the business which has — and that has billing and — we will be able to show much better for in future quarters.

Apoorva Bahadur — Investec — Analyst

Sir, I understand that this. I mean specific to Western DISCOM because that appears a bit better than the other DISCOMS and the responsibility to cover in the same — around the same time. So are you specific on this?

Praveer Sinha — Managing Director & Chief Executive Officer

So Western DISCOMS has more of Industry and consumers of EHG and HG consumers are very high over there and that’s why it has shown much higher increases in consumption compared to other.

Apoorva Bahadur — Investec — Analyst

Okay, got it. Sir, just one last question if I may, and I’m sorry for harping on again this Mundra issue, but just for sake of clarity, while we notified tariff is around INR6.20 paise per kilowatt hour we are booking around INR5.50 paise since the notification came and this INR6.20 paise there is a further possibility of further upside, if we see as a comes out with a favorable order. Is my understanding correct?

Sanjeev Churiwala — Chief Financial Officer

No, no your understanding is wrong. See, I’ve mentioned to you that they notified the tariff every 15 days and the tariff has changed because the price of ICI index whole have changed. It started from INR6.20 it went down to INR4.70 and now it has gone to INR5.90.

So it keeps on changing every two weeks, but when you get the coal, you get coal over a period of time and based on the actual cost of you are going to bill them. So that is the delta different that will happen and in such time the order of CRC does not come out, it would be speculative to give you a number and take and this is the number…

Apoorva Bahadur — Investec — Analyst

So sir the average notified tariff would be around INR5.50 paise?

Sanjeev Churiwala — Chief Financial Officer

No. That’s where I’m saying, don’t get into the average and there is a different price on every 15 days basis they are giving, you should then achieve the 50 notification that have come, you want that I will wend it to you.

Apoorva Bahadur — Investec — Analyst

Yes sir, that will be very helpful.

Sanjeev Churiwala — Chief Financial Officer

Otherwise it’s there on the — on the Ministry of Power website also you can see it over there.

Apoorva Bahadur — Investec — Analyst

Okay, thank you, thank you so much sir, that’s all from my side, have a good day.

Operator

Thank you. The next question is from the line of Dhruv Muchhal from HDFC Mutual Fund. Kindly proceed.

Dhruv Muchhal — HDFC Asset Management Company Ltd. — Analyst

Yeah, sorry. I got disconnected earlier. Some of the questions have been answered since. Sir just one question on the what is the Odisha DISCOM. We see the performance is improving. We understand the circle is still developing but we also see that — we also noticed that the regulatory assets are increasing. So should we understand this timely because of the fuel cost or is there some other element to this?

Praveer Sinha — Managing Director & Chief Executive Officer

The regulatory asset adjustment takes place on the annual basis. So, it’s a question of timing of some of the regulatory assets which is there which will get adjusted as of the end of the year. So it has nothing to do with the fuel costs and all that because in Odisha there is one single tariff that is charged by the generating companies and we also charge one single tariffs of the — so this is because of — they were — efficiency O&M cost or it is on the billing efficiency and things like that. So at the end of the year that throughout will take place and you will get that exact numbers, that is increase or decrease and depending upon that the tariff fixation takes place for the next year.

Dhruv Muchhal — HDFC Asset Management Company Ltd. — Analyst

Got it. And sir, the second just a follow up on one of the earlier questions on the shipping company. The — we understand the delta movement because of the FX but we wanted to understand what’s driving the loss in the current quarter? And probably also in the first half, the profitability is a bit lower, because we understand that — we are used to understand that this was a leasing arrangement where the profitability was largely assured. So I was just trying to understand what’s driving the loss?

Praveer Sinha — Managing Director & Chief Executive Officer

So again, the billing that we are doing on shipping is based on the CERC index. Now once we get the actual cost of shipping that is there, then we’ll be able to decide on it whether that needs be the revised.

Analyst — — Analyst

Okay, okay. So, okay, got it. Sure. Thank you so much. Thanks.

Operator

Thank you. The next question is from the line of Ajay Mehta from Wipro Limited. Kindly proceed.

Ajay Mehta — Wipro Limited — Analyst

Yeah. Good evening, everyone, and thank you for giving me the opportunity to ask this question. So, my first question sir to you is that considering the environment when interest rate are rising, so what is Tata Power’s plan on reducing the debt because that are still at a elevated level, right? Even though Y-o-Y has come down but still the average debt cost has been from 6-odd percentage to 7-odd percentage, right? So what is the plan to reduce that debt going forward?

Praveer Sinha — Managing Director & Chief Executive Officer

No, I think when you look at the overall net debt of the company, in spite of all the capex that we have done and of course incremental working capital because of higher revenues, our total net debt is still below INR40,000. What is important to look at it from a perspective of the leveraging from a net debt to total equity provision and our leveraging is well below 1.5%, our targeted leveraging was %1.5 of Tata Power levels is standing at 1.60% right now as we speak. Interest level, yes, we are kind of around 7% if you look at the current quarter and when we looked at a year back, it was around 6.6%, so we’ve seen about a 40 bps increase but that is at least almost a 190 bps increase in the debt rate. So, I think we have been able to manage our interest rate quite well including some of the international borrowings that we have done, including — this year, fairly $20 million borrowings that we did on on sustainable business loan. We’ve been able to kind of contain our overall cost of debt quite well.

Ajay Mehta — Wipro Limited — Analyst

Okay, okay. Thank you for your answer, sir. And my second question is has this #1.12.24 that there was a cyber attack, right, even though this will impact the financial and I believe you guys have taken the reports also. So, is there any action still pending to be done which would have an impact on Q3 numbers due to the cyber attack?

Praveer Sinha — Managing Director & Chief Executive Officer

No, there is no impact from #1.12.41 also. Very clearly the financials, the SAP systems and all is mobile protected, we did not had any impact, we did not have any financial loss other than our operations collections was as usual for us. So, yeah, we don’t see anything happening in quarter three as well.

Ajay Mehta — Wipro Limited — Analyst

Okay. And sir my last question is what is Tata Power vision with respect to this EV charging, right? I know that it is increasing your footprint quarter-after-quarter, it increases the number of cities being added, number of claims being added, great number of apartments, connectivity is improving. So what is like, the path going forward like from a next year perspective in terms of the growth that we see in the EV segment?

Praveer Sinha — Managing Director & Chief Executive Officer

So, our objective is that we need to provide seamless experience to the customer. And when we say that, if you are having automobile in your home, you should have that home charger which we should be able to provide. If you are traveling intercity, then whatever charging you need to carry out, you should have a seamless experience over there. Then one public transportation, the bus charging infrastructure. Now as far as the home charge and bus charging is there, that is on a cost-plus basis that we do. As far as the public charger is there, it is on a fee or a subscription model which is there. The consumption of that or the utilization of the public chargers is much less today because most of the people are still continue to use their own chargers. Also, the penetration of electric vehicle has not happened to that extent. So, we are creating a infrastructure so that over the next two, three years when the penetration of electric rate increases, the utilization of these chargers should increase from the present about 2% to about 15% by then it will be able to sustain its operation.

Ajay Mehta — Wipro Limited — Analyst

Sure, sir. Thank you so much for answering my questions. Thank you so much.

Operator

Thank you. [Operator Instructions] The next question is from the line of Suvarni from Spark Capital. Kindly proceed.

Bharanidhar Vijayakumar — Spark Capital Advisors (India) Private Limited — Analyst

Yeah. Good evening. So this is Bharani from Spark Capital. Sir, what is your view on the international coal prices over the next say two quarters? And what would be your rationale for that?

Praveer Sinha — Managing Director & Chief Executive Officer

Sir, the — normally the coal prices have been very high and we do not expect that it will reduce at least for next 12 months. So we expect that the coal prices will remain high, now whether it will be at the present level or little lower than this, I cannot predict that. But yes, the coal will be in demand, especially imported coal will be in demand considering the global need for energy substitute.

Bharanidhar Vijayakumar — Spark Capital Advisors (India) Private Limited — Analyst

Sure. Could you share the FOB realization per ton and gross profit per ton for the KPC mine for the second quarter?

Praveer Sinha — Managing Director & Chief Executive Officer

We don’t tell off the coal over here. So, that details we can give you from the CPC reports, sir, we don’t have that with us. We can share with you the CPC.

Bharanidhar Vijayakumar — Spark Capital Advisors (India) Private Limited — Analyst

Sure. Thank you and all the best.

Operator

Thank you. As there are no further questions, I would now like to hand the conference over to Dr. Praveer Sinha for closing comments.

Praveer Sinha — Managing Director & Chief Executive Officer

Thank you, Vivian, and thank you to everyone for joining in the call. And in case you have any further queries, any other details that you would require, please connect with Kasturi and Rajesh Lachhani and we’ll be more than happy to connect with you. Once again, the season greeting and all the best for the festive season.

Operator

[Operator Closing Remarks]