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NTPC to file review petition

By Our Special Correspondent

NEW DELHI, APRIL 5. Hit adversely by the impact of new tariff order, the National Thermal Power Corporation (NTPC) plans to file a review petition before the power regulator, Central Electricity Regulatory Commission (CERC), even as it is optimistic about maintaining the net profit at Rs. 4,900 crores through new initiatives and projects.

"Earlier also we improved our bottomline despite CERC orders... We will strive to maintain our profitability even now," C. P. Jain, NTPC Chairman and Managing Director, told newsmen while sharing annual results.

While conceding that the previous tariff order had an impact of Rs. 1,046 crores during 2003-04, he said still the corporation posted a net profit of Rs. 4,905 crores, up 36 per cent. Its gross revenue went up to Rs. 25,184 crores from Rs. 19,850 crores. However, he declined to give an estimate of the impact of the new tariff, effective from April 1, and was not ready to reveal the grounds on which NTPC would seek a review of the Regulator's order issued late last month.

By its orders, the CERC had, among other things reduced, the return on equity from 16 per cent to 14 per cent for all the power generators with the proviso that the debt component in any project would be 70 per cent of the total cost.

Referring to many new initiatives taken to expand its business which include major thrust on hydro-electric power and the joint venture route for increasing presence in the power sector, Mr. Jain said NTPC's two joint ventures with Steel Authority of India Ltd (SAIL) have earned the corporation a net profit of over Rs. 32 crores last year.

On future plans aimed at diversification, NTPC had also lined up a slew of projects in the distribution end for which it had already filed an expression of interest to take up circles in Gujarat and Karnataka on franchisee basis. Similarly, on the thermal side, the company planned to add fresh capacities to of 9,370 MW during the Tenth Plan, of which over 7,000 MW was under construction while 1500 MW had been completed.

Mr. Jain also said that the corporation would hit the market with an initial public offering of shares representing 5 per cent of its equity by early August. "We hope to come out with an IPO for sale of 5 per cent of our equity by first fortnight of August".

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