GVK loss widens to Rs.57.

19 cr in September quarter
Total income from operations grew 8% to Rs.691.9 crore from a year earlier
Viswanath Pilla

GVK said it has sought reschedulement of project loans aggregating to Rs1,416.47 crore from lenders.

Hyderabad: GVK Power and Infrastructure Ltd widened its consolidated loss to Rs. 57.19 crore in the quarter ended 30 September on account of fuel shortages at its power plants and high interest costs. The company had reported a loss of Rs.43.66 crore in the corresponding quarter of the previous year. Total income from operations grew 8% toRs.691.9 crore from a year earlier. The loss during the quarter was attributable mainly to the stoppage of supply of gas for two power plants and reduced supply to one plant, as a result of which the plants operated at very low capacity, GVK said in a statement on Thursday. The companys three gas-based projects469 megawatts (MW) GVK Gautami Power Ltd, and the 217MW Jegurupadu phase I and the 228MW Jegurupadu phase II projects of GVK Industries Ltd recorded a revenue ofRs.96 crore in the second quarter, down 64% from Rs.265 crore a year earlier. The company said the GVK Gautami and the Jegurupadu phase II projects were idle due to the lack of availability of gas, while the Jegurupadu phase I operated at 45% plant load factor, or capacity utilization levels.
Gas Authority of India Ltd supplied gas to the Jegurupadu phase I plant, while supplies from Reliance Industries Ltds D6 block in the Krishna-Godavari basin has been stopped since 31 March, GVK said.

There has been uncertainty regarding supplies and availability of gas to power generating plants and power projects under construction of the group, the company said, adding that the management is confident of obtaining the requisite gas allocation and recover fixed charges. GVK also said it has sought rescheduling of project loans aggregating toRs.1,416.47 crore from lenders and is confident of receiving approval of the lenders. GVK has a consolidated debt of around Rs.20,000 crore. Interest costs rose 20.6% to Rs.212.6 crore in the September quarter. The interest cost on borrowing for the acquisition of a stake in Mumbai and Bangalore airports also has an impact on the consolidated profit, the company said. Revenue from its airport business grew 68% to Rs.528.9 crore. GVK owns and operates Mumbai International Airport Pvt. Ltd and Bengaluru International Airport Ltd. Mumbai International Airports revenue climbed 66% to Rs.523.07crore in the September quarter, and net profit doubled to Rs.84.77 crore. Bengaluru International Airports revenue rose a more modest 7% toRs.160.36 crore but net profit surged to Rs.38.62 crore from Rs.16.74 crore a year earlier. GVK, through its wholly owned unit GVK Airport Developers Pvt. Ltd, holds 50.5% of a consortium that operates the Mumbai airport. It has a 43% stake in a separate consortium that runs the airport in Bangalore. The revival of infrastructure companies like GVK will depend on their ability to quickly monetize assets and reduce debt, said Satish Kantheti, head of research at Hyderabad-based brokerage house Zen Securities Ltd. Organic turnaround at this juncture will be tough with a slowing economy, Kantheti said. GVK has been in talks with investors to sell stakes in its airport business to retire a portion of its debt. The process of due diligence is on, said Isaac George, director at GVK. Another group company GVK Jaipur Expressway Pvt. Ltd recorded an 11% increase in revenue to Rs.67.8 crore for the September quarter. Shares of GVK rose 2% to close at Rs.7.70 on BSE on Thursday, while the benchmark index Sensex rose 1.02% to 20,399.42 points.