Power Grid Corporation of India Ltd (PGCIL) has targeted asset capitalization in the region of Rs.10,000 crore to Rs.12,000 crore in FY23, according to K. Sreekant, CMD, PGCIL.
The top PGCIL official noted this while addressing an investor conference discussing the company’s financial performance during Q3 of FY23, adding that much of the capitalization during the remaining months of FY23 would come from TBCB projects.
In the first three quarters (April to December) of FY23, PGCIL achieved capitalization of Rs.5,190 crore with Rs.2,057 crore coming in Q3 (January to December) alone.
This capitalization is at the “consolidated” level in that it includes the capitalization of its wholly-owned subsidiaries, which are mainly special purpose vehicles for TBCB projects.
Asset capitalization broadly refers to projects under execution getting commissioned, thereby turning into operational assets.
Meanwhile, capital expenditure by PGCIL at the consolidated level stood at Rs.5,429 crore during the first nine months of FY23. The corresponding figure for PGCIL on standalone basis was Rs.3,142 crore.
At the consolidated level, PGCIL has targeted capital expenditure of Rs.8,800 crore for FY23. Incidentally, PGCIL expects capital expenditure of the same amount during FY24 also. However, this guidance could change depending on the company’s success in winning projects under the TBCB regime, K. Sreekant noted.
Also read: PGCIL Expects Shoot-Up In Capex In FY25 And Beyond
Projects in hand
As of December 31, 2022, PGCIL had estimated work-in-hand worth Rs.47,600 crore. Out of this, Rs.7,600 crore related to ongoing (non-TBCB) projects while Rs.27,000 crore was accounted for by new (non-TBCB) projects. The remaining Rs.13,000 crore came from TBCB projects.
Of the Rs.27,000 crore worth of new projects on hand, the Ladakh transmission line for which PGCIL has been nominated as the implementing agency is significant. The project costing around Rs.20,000 crore (inclusive of Central government grant of Rs.8,000 crore) aims at creating evacuation infrastructure for the upcoming Leh renewable energy park in the UT of Ladakh. By current thinking, this project will see the deployment of HVDC power transmission technology.
K. Sreekant said that while the Leh transmission scheme will take 5-7 years to commission, the remaining work in hand has a completion schedule of 2-3 years from now.
It may be mentioned that in her Budget 2023 speech, Union finance minister Ms Nirmala Sitharaman had also highlighted this project. “The inter-state transmission system for evacuation and grid integration of 13 GW renewable energy from Ladakh will be constructed with investment of Rs.20,700 crore including central support of Rs.8,300 crore,” she said.
Meanwhile, K. Sreekant noted that PGCIL would start incurring capital expenditure on the Leh transmission scheme during FY24.
