News

* L&T net profit rises 10% to Rs 43.96 billion in Q4
Engineering and construction major Larsen & Toubro (L&T) on Wednesday reported a 10.2 percent increase in consolidated net profit at Rs 43.9612 billion in the March quarter on the back of higher income.

The company had posted a consolidated net profit of Rs 39.8678 billion in the year-ago period.

The consolidated income of the company rose to Rs 681.2042 billion in the latest fourth quarter from Rs 590.7606 billion recorded a year ago, L&T said in a stock exchange filing.

“The year has concluded on a very strong note for us. We have secured order inflows of more than Rs 3000 billion and order book is around Rs 4750 billion, reflecting the continued trust reposed on us by all our esteemed clients.

“During the year, we successfully completed the maiden buyback of equity shares, in line with our aim to improve shareholder value. Furthermore, in addition to the special divided of Rs 6 per share paid to our equity shareholders during the year, we are recommending a final dividend of Rs 28 per share for the financial year 2023-24,” company’s Chairman and Managing Director S N Subrahmanyan said.

In a statement, the company said that for the quarter ended March 2024, the profit after tax (PAT) stood at Rs 43.96 billion, showing a growth of 10 percent year on year.

(Source: PSU Watch)

* Larsen & Toubro wins new orders in clean energy space
The Power Transmission & Distribution (PT&D) business of Larsen & Toubro has won multiple orders in India and abroad which stand testimony to its dominant position in the region’s clean energy space. According to the company’s project classification, the value of these orders range between Rs 50 billion to Rs 100 billion.

The business has bagged orders to establish two Floating Solar Plants in India. The orders comprise a cumulative floating solar capacity of more than 150 MWac, in addition to a ground-mounted Solar PV of 120 MWac capacity. Floating Solar projects involve mounting solar modules on structures that float in a water body, typically a reservoir/ lake/ abandoned quarry. Compared to ground-mounted solar plants, floating solar plants do not require land acquisition and typically involve less civil works. There are other site-specific merits too, besides reduction of water evaporation.

PT&D has also received orders to establish 765 kV Transmission Lines and a Gas Insulated Substation to integrate Solar Energy Zones in Rajasthan and Karnataka. These crucial links will enable the evacuation of Renewable Energy to load centres in various parts of the country.

Business has secured another order in the State of Kuwait to build a 400kV Gas Insulated Substation. This substation will be instrumental in powering the residential clusters being developed as part of South Sabah Al-Ahmad City project.

The Sultanate of Oman is integrating its multiple standalone electricity networks into a 400 kV national grid. As part of the interconnection and grid strengthening, PT&D has received orders to build a 400 kV Overhead Transmission Line and two 400 kV Grid Stations.

(Source: Business Standard)

* Nearly 75 Democratic lawmakers support Biden’s LNG pause
Nearly 75 U.S. lawmakers from President Joe Biden’s Democratic party on Tuesday praised his pause on approvals of exports of liquefied natural gas, or LNG, saying it would protect Americans from pollution and potential higher prices.

Senators Jeffrey Merkley, Edward Markey and Representative Jared Huffman spearheaded a letter to Biden saying the pause allows the government to study whether the additional exports could saddle U.S. households and businesses with higher natural gas bills, boost climate changing emissions and lead to greater pollution in communities near LNG export plants.

The pause on approvals of exports to countries with which Washington does not have a free trade agreement allows U.S. labs to study the effects of the booming business.

WHY IT’S IMPORTANT

It’s the biggest show of support yet in Congress for the pause. Biden put a hold on reviews in January after environmentalists, an important part of his base, protested approvals for fossil fuel projects. The pause is expected to last through the Nov. 5 election.

(Source: Reuters)

* CAG: OIL Suffers Multi-Million Losses Due To Delayed Projects
Oil India Limited (OIL), a Maharatna public sector company, has been hit with multi-million losses due to delays and other anomalies in its projects, according to a recent audit report by the comptroller and auditor General (CAG).

A three-member team from CAG comprising senior audit officer R N Das, assistant audit officer Rahul Chaturvedi, and assistant audit officer Sourasen Dutta visited OIL’s field headquarters at Duliajan and conducted the transaction audit of Oil India Limited’s projects department from March 8 to 20. The findings highlighted several anomalies in three ongoing delayed projects.
The audit report which covers the years 2019-20 to 2022-23 identifies three significant findings.

The first finding reveals a loss of Rs 106.8 million for OIL due to the non-recovery of liquidated damage (LD) worth Rs 82.4 million from the contractor and inadequacies in contractual clauses related to the construction of an effluent treatment plant (Rs 24.4 million) at Tengakhat in Dibrugarh district.

The project began in May 2014 and the basic engineering works were completed by M/s Engineers India Limited (EIL).

The second finding in the CAG report highlights the idling of the Baghjan Madhuban Pipeline (BMPL) for over two years after its commissioning, resulting in a loss of interest worth Rs 278.8 million on blocked capital and a reduction in the value of the asset by Rs 517.3 million.

The third finding by CAG addresses the delay in the construction of the Oil Collecting Station (OCS) in Nadua and Group Gathering Station (GGS) in East Khagorijan, which has resulted in a blockage of OIL’s funds amounting to Rs 3322 million for three years, along with the non-recovery of liquidated damage worth Rs 264.1 million. The CAG report highlighted lack of significant best practices or innovation on the part of OIL during the inspection. The findings also raise concerns about the efficiency and management of OIL’s projects, as well as the potential financial losses incurred.

Notably, all the ongoing projects fall under the jurisdiction of the Director (Operations), OIL.

Meanwhile, under pressure from the ministry of petroleum and natural gas, Oil India Limited CMD had entrusted Boston Consultancy Group (BCG) to evaluate the inordinate delay in the construction of the Oil Collecting Station (OCS) at Nadua and Group Gathering Station (GGS) at East Khagorijan. BCG had already submitted their report to the CMD, OIL, after visiting both the delayed project sites.

(Source: TOI)

* Indraprastha Gas Cuts FY25 Volume Guidance As Electric Vehicles Gain Popularity
Indraprastha Gas Ltd. has revised its fiscal 2025 volume guidance lower, mainly due to the shift towards electric vehicles. However, the management maintains a positive segment-wise outlook in terms of growth.

The natural gas distribution company has revised its FY25 volume guidance after failing to meet its last fiscal guidance of 9 million metric standard cubic metres per day by 3% to 8.73 million metric standard cubic metres per day.

The FY25 volume guidance now stands at 9.5 million metric standard cubic metres per day, Managing Director Kamal Kishore Chatiwal told NDTV Profit. That compares with the earlier guidance of 10 million metric standard cubic metres per day.

Volume Expectations

Indraprastha Gas expects a 14–15% volume uptick in the industrial and commercial petroleum natural gas segments going forward. The industrial petroleum natural gas segment saw encouraging growth in Q4 FY24, Chatiwal said. He expects volumes to rise 8–10% for FY25.

For the compressed natural gas segment, which accounts for the majority of the gas distributor’s sales volumes, Chatiwal stated that the company expects a 7-8% volume uptick. He also stated that out of the guided 9.5 million metric standard cubic metres per day volume of gas, 71–72% will come from the compressed natural gas segment.

Price Cuts

Chatiwal explained that the company implemented the Rs 2.5 per kg price cut in its compressed natural gas segment in March 2024 to maintain parity with the at-the-pump fuel rates of petrol and diesel, which also experienced a Rs 2 per litre price cut.

The price cuts have helped with the company’s conversations with OEMs, he said. The company is also comfortable with the present prices and does not see any further price cuts for CNG.

(Source: NDTV)

* Indraprastha Gas Q4 dividend: IGL board recommends Rs 5 dividend, posts Q4 earnings
The board of directors of Indraprastha Gas on Tuesday, May 7, recommended a final dividend of Rs 5 per equity share for FY24 with a face value of Rs 2 each, according to a stock market disclosure.

“The Board also recommended final dividend @ 250% i.e. Rs.5 per share (face value of Rs.2/- each) for the financial year 2023-24, subject to the approval of shareholders in the ensuing Annual General Meeting,” the company said in a BSE filing.

Simultaneously, the city gas distribution company IGL has also posted its financial results for the fourth quarter ended on March 31, 2024.

IGL reported a 9 per cent increase in its consolidated net profit at Rs 4332.9 million for the fourth quarter in comparison with Rs 3975.1 million a year ago. The company’s revenue from operations came in at Rs 39.6442 billion, declining marginally from Rs 40.5644 billion recorded in the same period last year.

(Source: Zeebiz)

* India sees record petrol and diesel consumption on vehicle sales, EVs yet to catch up speed
Indian oil marketing companies (OMCs) seem to be riding high on the growing vehicle ownership in India. A Petroleum Ministry report analysing Petroleum and lubricants (POL) consumption in the 2023-24 fiscal says that OMCs sold 37.22 MMT of petrol during the year, 6.4% higher than FY23.

“This is record consumption with a monthly average of more than 3 MMT. The consumption riding on vehicle ownership growth has almost doubled since a decade back with a CAGR of 8.1%. Clearly, buoyant vehicle sales are koi giving a huge push to petrol sales,” the report noted.

According to Vahan registrations and Society of Indian Automobile Manufacturers (SIAM) data, total vehicle sales stood at 23.9 million in FY24, 12.5% higher than the previous fiscal. Of these, passenger vehicles or cars recorded sales of 4.219 million, higher by 8.45% YoY, with about 60% of sales being SUVs indicating their dominance in the segment.

(Source: CNBC)

* NTPC Green Energy inks MoU with MAHAPREIT for development of RE power parks & projects
NTPC Green Energy Limited (NGEL) and Mahatma Phule Renewable Energy and Infrastructure Technology Limited (MAHAPREIT) on Wednesday signed a memorandum of understanding (MoU), at NTPC Corporate Office, New Delhi for the development of renewable energy power parks and projects.

The collaboration aims to realize the green energy objectives of NTPC and the Government’s efforts towards energy transition.

The MoU has been signed between NGEL’s Chief Executive Officer Rajiv Gupta and MahaPreit’s Chairman and Managing Director (CMD) Amol Shinde in the presence of NTPC’s Director (Finance & HR) Jaikumar Srinivasan and other senior officials from NTPC, NGEL and MAHAPREIT.

The MoU envisages the joint development of grid connected Renewable Energy Park and Projects including Solar, Wind, Hybrid etc. and/or solutions thereof up to 10 GW in the state of Maharashtra.

(Source: PSU watch)