PGCIL targets Rs.10,000-plus crore capex in FY24

 

 

Power Grid Corporation of India Ltd (PGCIL) expects to cross the Rs.10,000-crore mark for capital expenditure in FY24, according to R.K. Tyagi, CMD, PGCIL.

Addressing an investor conference recently, Tyagi said that PGCIL would be incurring capital expenditure (capex) of over Rs.10,000 crore during FY24 (financial year ending March 31, 2024), much higher than the targeted Rs.8,800 crore.

Incidentally, the targeted Rs.8,800 crore includes Rs.5,000 crore from RTM (regulated tariff mechanism) projects and the remaining Rs.3,800 crore mainly through tariff-based competitive bidding (TBCB) projects.

In Q3 (October to December) of FY24, PGCIL achieved capex of Rs.3,444 crore – the highest in any quarter of FY24. In the first nine months of FY24 (9M: April to December), capex stood at Rs.7,690 crore.

 

Tyagi noted that by end-January 2024, cumulative capex in FY24 had already crossed Rs.8,700 crore.

 

Meanwhile, capitalization (which broadly refers to assets commissioned) stood Rs.5,780 crore in 9MFY24. For the entire FY24, PGCIL expects capitalization of Rs.8,000 crore to Rs.8,500 crore, the PGCIL CMD said.

Discussing future trends, R.K. Tyagi observed that PGCIL was targeting capex of over Rs.15,000 crore in FY25, and for FY26, this figure would be in excess of Rs.20,000 crore.

Incidentally, the Interim Budget 2024 has indicated PGCIL’s plan outlay (capex) for FY25, at Rs.12,500 crore. (Read related story)

 

The CMD’s optimism on high level of capex was based on the business opportunity size of Rs.2,07,500 crore that PGCIL has estimated it has, from now up to the year 2032. Of this, Rs.1,90,500 crore would come from the power transmission sector alone, which would include interstate and intrastate lines, as well as cross-border lines and even international projects.

 

Work in hand

As of December 31, 2023, PGCIL had work-in-hand with estimated value of Rs.77,700 crore. This included Rs.11,450 crore in ongoing RTM projects, Rs.24,800 crore in new RTM projects and the remaining Rs.41,450 crore in TBCB projects. The work-in-hand in new RTM projects includes the mega Ladakh HVDC project that is estimated to cost over Rs.20,000 crore.  Of the total work-in-hand of Rs.77,700 crore, around 70 per cent is associated with evacuation systems for renewable energy (RE) projects.

Also read: PGCIL Named Successful Bidder For Bidar ISTS Scheme

Note: The capex and capitalization discussion in this story is on “consolidated” basis in that it includes PGCIL and its subsidiaries. In other words, this takes into account both “RTM” and “TBCB” projects of PGCIL.