Data Collected for Ntpc

8/12/2019 Data Collected for Ntpc

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INTRODUCTION Scenario of Power in India Growth of economy calls for watching the rate of growth in

infrastructure facilities.Power sector is one of the major aspectsof this infrastructure building. Some prominent people like the Ex Chairman of GE Jack Welch have gone to the extent of saying, you dont have a chance to stand in the 21 st century without lots of powerWithoutthis you miss the nextrevolution .Moreover, the growth rate of demand for power in developingcountries is generallyhigher than that of GDP. In India, theelasticity ratio was 3.06 in 1 st

plan, & peaked at5.11 during 3 rd

plan and came down to 1.65 in 80s. For 90s a ratio of around

1.5 was projected. Hence, in order to support a growth of GDPof around 7%, the rate of growthof power supply of 10% isrequired.If we look at current scenario, electricity consumptionin India has more than doubled inthe last decade, outpacing theeconomic growth. If we analyze the various statistics of Indian

power sector, we will find that the generating capacity has goneup tremendouslyfrom a meager 1712MW in 1950 to a whooping147000MW today.The critical role played by the power industryin the economic progress of a country hasto be emphasized. Aself sufficient power industry is vital for a nation toachieveeconomic stability Indian Power Industry


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Before Independence

--The British controlled the Indian power industry firmly beforeIndependence. Then legaland policy framework was

contributing to private ownership, with not much regulationwithregard to operational safety. Post Independence Immediately after Independence, the country was faced withcapacity restraint. Indiaadopted a socialist structure foreconomic growth and all the major industries werecontrolled by

public sector enterprises. By 1970's, India had nationalized mostof itsenergy assets, due to its commitment to social goals. By thelate 1980's, the Indianeconomy felt the strain of the socialistagenda followed since independence. Faced with aseriousdeterioration in public finance and balance of payment crisis, theUniongovernment as part of its policy of economic liberalizationallowed greater investment by private sector in the powerindustry. THE electricity sector in India

is predominantly controlled by Government of India's publicsector undertakings (PSUs). Major PSUs involved in thegeneration of electricityinclude National Thermal PowerCorporation (NTPC), National Hydroelectric Power Corporation(NHPC) and Nuclear Power Corporation of India (NPCI).


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Besides PSUs,several state-level corporations, such asMaharashtra State Electricity Board (MSEB), arealso involvedin the generation and intra-state distribution of electricity. The

Power GridCorporation of India is responsible for the inter-statetransmission of electricity and the development of national grid.India is world's 6th largest energy consumer, accounting for3.4% of global energyconsumption. Due to India's economicrise, the demand for energy has grown at An average of 3.6%

per annum over the past 30 years. In March 2009, the installed power generation capacity of India stood at 147,000 MW whilethe per capita power consumption stood at 612 kWh. Thecountry's annual power production increased fromabout 190

billion kWH in 1986 to more than 680 billion kWH in 2006. TheIndiangovernment has set an ambitious target to addapproximately 78,000 MW of installedgeneration capacity by2012. The total demand for electricity in India is expected tocross950,000 MW by 2030.Electricity losses in India duringtransmission and distribution are extremely high andvary

between 30 to 45%. In 2004-05, electricity demand outstrippedsupply by 7-11%.Due to shortage of electricity, power cuts arecommon throughout India and this hasadversely effected thecountry's economic growth. Generation Grand Total Installed Capacity is 147,402.81 MW

Thermal Power

Current installed capacity of Thermal Power (as of12/2008) is 93,392.64MW which is 63.3% of total installedcapacity.


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Current installed base of Coal Based Thermal Poweris77,458.88 MW which comes to 53.3% of total installed

base.

Current installed base of Gas Based Thermal Power is14,734.01 MW which is 10.5% of total installed base. Current installed base of Oil Based Thermal Power is

1,199.75 MW which is 0.9% of total installed base.The stateof Maharashtra is the largest producer of thermal power inthe country.

HydroPower India was one of the pioneering states in establishing

hydro-electric power plants, The power plant at Darjeelingand Shimsa (Shivanasamudra) was established in 1898 and1902respectively and is one of the first in Asia. Theinstalled capacity as of 2008 wasapproximately

36647.76. The public sector has a predominant share of 97% in this

sector. Nuclear Power Currently, 17 nuclear power reactors produce 4,120.00 MW (2.9% of total installed base).

Renewable Power Current installed base of Renewable energy is

13,242.41 MW which is 7.7% of total installed base with thesouthern state of Tamil Nadu contributing nearly a third of it(4379.64 MW)largely through wind power.


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Power for ALL by 2012 The Government of India has an ambitious mission of POWERFOR ALL BY 2012. Thismission would require that our

installed generation capacity should be at least 200,000 MW by2012 from the present level of 144,564.97 MW. Powerrequirement will double by 2020to 400,000MW.Todays environment is a tough environment to survive, with thenew industries and the newsectors coming up so strongly andfinancially sound. But to gain an extra edge over otherstheyought to have an extra or special added advantage. Our people are our most important asset . Nearly every organization report contains a phrase like this &for good reason. Today, the last great source of competitiveadvantage ishuman capital.

Rationale The purpose of the research was to criteria on which investment

of the company is raisedevery year and a favorable rate of returnis arrived at, increasing the net result of the companyas per their

budget. ObjectiveThe study is aimed at:

To gain the overall idea about the organization. To find out the financial performance of the organization To find out the future requirement of finance in business

Scope of the Study The study on the financial statements will help the interested

parties to know about the overall financial health of thecompany. The ratios are helpful to forecast the future oftheorganization based on the past performance.


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Company Profile

Background of NTPC

NTPC a global giant in power sector NTPC Limited is the largest power generating company ofIndia. A public sector company, itwas incorporated in the year1975 to accelerate power development in the country as awhollyowned company of the Government of India. At present,Government of India holds89.5% of the total equity shares ofthe company & the balance 10.5% is held by FIIs,DomesticBanks, Public and others. Today, it has emerged as an Integrated Power Major with a significant presence in the entirevalue chain of power generation business. Based on 1998 data, carried out by Data monitor UK, anISO 9001:2000 certifiedcompany, NTPC is the 6th largestin terms of thermal power generation & the secondmostefficient in terms of capacity utilization amongst the thermalutilities in the world.

Within a span of 33 years, NTPC has emerged as a truly national power company, with power generating facilities in all the majorregions of the country. Driven by its vision tolead, it has chartedout an ambitious growth plan of becoming a 75000 MW pluscompany by2017. Vision A world class integrated power major, poweringIndiasgrowth, with increasing global presence ." Mission Develop and provide reliable power, relatedproducts andservices at competitive prices, integratingmultiple energy sourceswith innovative and eco-friendlytechnologies and contribute tosociety .


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Core Values BCOMITB Business Ethics

C C ustomer Focus (External & Internal) O O rganizational & Professional Pride M M utual Respect & Trust I I nnovation & Speed T T otal Quality for Excellence

Graphi cal Presentation of Market Capitalisation


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Achievements Recognizing its excellent performance and vast potential,Government of the India hasidentified NTPC as one of the

jewels of Public Sector ' Navratnas' a potential global giant. A) NTPC ranked 317th in the 2009, Forbes Global 2000 ranking of the Worlds biggestcompanies. B) NTPC has been rated as one of the top most Best Employer of t he country for the year 2003, 2004 & 2005 in a row. C) It has also been rated as one of the Best Companies toWork for in India byMercer HR Consulting- Business TodaySurvey 2004, it has developed into a multi-locationand multi-fuel company over the past three decades. D) NTPC has been awarded No.1, Best Workplace in India among large organizations for the year 2008, by the Great Placesto Work Institute, India Chapter in collaboration withTheEconomic Times. E) Leadership Award for CMD, NTPC in the 4th GlobalLeadership Summit by AmityUniversity for Sectoral

Excellence in Power industry for his outstanding contribution tothegrowth of Indian business & bringing glory to the countrythrough his pioneering leadership. F) Ranked #1 independent power producer in Asia in the THIRD ANNUAL PLATTSTOP 250 GLOBAL ENERGYCOMPANY AWARDS 2008 for outstanding Globalfinancial &Industrial performance at the award ceremony in Singapore. Thecorporation has been simultaneously ranked #15, overall in Asiaamongst the energy companies.

G ) NTPCs excellence in executing power projects & itsinitiative in DecentralizedDistributed Power Generation has


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been recognized and awarded at IEEMA Power Awards2008 NTPC Vindhyachal Stage-III (2x 500MW) has been conferredthe IPMA SILVER MEDAL for Project Excellence by

International Project Management.Association, at the IPMA Congress, held in Rome, Italy, forimplementation of project inrecord time & achieving excellentenvironmental, economic performance and giving outstandingsupport to the local community.Organization Structure of NTPC


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SWOT ANALYSIS:-STRENGTHS:-1.GOOD CORPORATE IMAGE

2.Complete range of product for transmission & distribution.3. Established brand name with executive oriented program.4. Strong & wide networks of manpower across India.5. Considered to be having technology & design ability. Weakness: -

1. The procurement process in the companies is cumbersomeand subject to auditing

2. .2. Low exposure to the needs & dynamics of distribution business.

3. 3. Role clarity on the requirement of being an equipmentsupplier or a solution provider.As there are very fewsupplier of equipment manufacturing plant.

Opportunities: - 1. Huge Investment leading to greater demand of goods andservices.

2. Demand leading to Industry operating at full & over capacity.3. Better Price realization.

4. Early birds to learn faster and thus achieve repeat orders.Policy to bid from ultra mega power plant

5. .5. Vertical integration for supply chain management ofcoal by acquiring coal blogs.

Threats: - 1. Purchases preference may be extended to distribution sector.2. Increase in no. of small contractors leading to price war.3. Emergence of competitors in the market like Schneider,Reliance, Tata etc.4. Change in government policies for open trade or stock tradingor energy trading.5. Reduce the time lag.


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CompetitorsTorrent Power

Entered the power sector by acquiring two old state ownedelectricity companiesand turned them into power utilitiescomparable with the best.BHEL 14 Manufacturing plants 279 Coal based Thermal Utility Sets of BHEL,including 29 Sets of5 0 0 M W a n d 1 5 7 S e t s o f 1 9 5 -2 5 0 M W i n s t a l l e d i n t h e C o u n t r y ( A s o n 31.03.07) During 2006-07, out of 279 Coal based Thermal Utility Sets ofBHEL in theCountry, 77 sets operated at PLF > 90% (6 sets

at 100%; 18 sets at 95

100% and 53 sets at 90-95%)- 24 -

Industry players and profile The power sector reveals that it can be largelysegregated into four differentcategories on the basis of type of

players in the industry. These include:Central Government Corporations: which consist of corporations likethe National Thermal PowerCorporation (NTPC), Nuclear PowerCorporation,National Hydro Electric Power Corporation (

NHPC), and some other smaller players.


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State Government Corporations Which consist of thevariousstateelectrici ty boards and other corporationsthat have been promoted by therespective governments.

Poor management, transmissionand distribution (T&D)l o s s e s a n d p o o r r e c o v e r i e s o f d u e s a r e s o m e o f t h e f a c t o r s , w h i c h a r e r e s p o n s i

ble for the plight of these corporations. Currently, the financialhealth of many SEBs is precarious and their revenue-raisingcapabilities are more or lessdependent on assured guarantees from therespective governments.Private Sector Licensees: In the private sector, some companies hadbeen given licenses tocarry on generation and distribution activities. While someof thesecompanies are generation and distribution companies, others likeSuratElectricity are just distribution companies.

Independent Power Producers:

The Independent Power Producers(IPPs) are thecompan ie s t ha t have been g iven a nod t o s e t upgenerationcapacities.Finally, a look at the regulatory structureof the sector indicates that various Actsgovern the power sector.


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Data Collected for Ntpc