Adani Set to Upgrade Mumbai Network with Investments worth Rs 1,200 Crores

The investment in its power distribution business would be crucial for Mumbai as the city’s electricity distribution infrastructure did not receive much investment in the past few years as its previous owner Reliance Infrastructure was in the process of selling it, power industry experts maintained

August 12, 2019. By News Bureau

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Adani Transmission has announced that it plans to devote close to Rs 4,000 crore on capital expenditure in FY20, of which about Rs 1,200 crore has been allocated for power distribution infrastructure in Mumbai, the business it had acquired, a top executive from the Gautam Adani-led company said.

The investment in its power distribution business would be crucial for Mumbai as the city’s electricity distribution infrastructure did not receive much investment in the past few years as its previous owner Reliance Infrastructure was in the process of selling it, power industry experts maintained.

“For four years, there was virtually a drought in terms of the maintenance capex and capital addition. The programme that’s now underway, which has been approved by the regulator, is three times what was spent earlier. The capex plan would be primarily in the transmission area, so the wheeling charges and customer charges will not be impacted,” said Anil Sardana, CEO, Adani Transmission.

Driven by the electricity distribution business and the new commissioning in its transmission business, the company reported a 26% year-on-year growth in net profit at Rs 213.4 crore in the first quarter of FY20. Revenue for the quarter increased 316% on-year to Rs 2,889.7 crore, mainly due to the inclusion of the Mumbai distribution business which it did not own in the same quarter a year ago.

“We have free cash flow of Rs 1,400 crore that establishes the fact that we can have internal resources to meet the equity requirement and do capital expenditure of about Rs 4,000 crore every year,” Sardana said.

 “We are committed to leveraging our experience and expertise to continue as a leading transmission company as well as the preferred choice of utility in electricity distribution,” chairman Gautam Adani was quoted as saying in a statement.

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