A Project Report On

Analysis of Power Sector Industry in India

Submitted By:

Chintan N. Lad (A-24) Viral Y. Panchal (A-34) Mitesh H. Salunke (B-46)

MBA PROGRAMME 2009-2011 (SEMESTER III)

SUB: - SAPM
SHRI JAIRAMBHAI PATEL INSTITUTE OF BUSINESS MANAGEMENT AND COMPUTER APPLICATIONS (NICMMBA)

Submitted to Dr. Narayan Baser

Sr. No.
1 2 3 4 5 Introduction

Particular

Page No

Economic Analysis of Power sector Industry Analysis Company Analysis TECHNICAL ANALYSIS Bibliography

1.
1.1

Introduction
Power Sector in India

When India became independent in 1947, the country had a power generating capacity of 1,362 MW. Generation and distribution of electrical power was carried out primarily by private utility companies. Notable amongst them and still in existence is Calcutta Electric. Power was available only in a few urban centres; rural areas and villages did not have electricity. After 1947, all new power generation, transmission and distribution in the rural sector and the urban centres (which was not served by private utilities) came under the purview of State and Central government agencies. State Electricity Boards (SEBs) were formed in all the states. National Thermal Power Corporation (NTPC), National Hydro-electric Power Corporation (NHPC) and Power Grid Corporation Limited (PGCL) were formed by the government to assist in meeting the increasing demand for electricity throughout the country. The electricity sector is in the 'concurrent list', meaning that both, State and Central governments participate in the sector's development. The Ministry of Power in the Central government formulates the policies for the power sector. The Central Electricity Authority (CEA) was established as a statutory authority to develop a 2nd National Power Policy and also to function as a regulatory authority. As per government guidelines, all power projects above a certain capacity have to obtain techno-economic clearance from CEA before they can be implemented. A new Ministry of Non-Conventional Energy Sources has also been formed to focus on renewable energy sources to augment the generation capacity of electrical power. The Public sector units (PSUs) provided a vital service to the nation in the post-independence era. From the few transmission and distribution networks existing at the time of independence, in few urban centres, the PSUs have established networks covering the entire length and breadth of the country. Besides, massive rural electrification programs have boosted agricultural production in a big way. Today, India is self-sufficient in food grains primarily because of this.

1.2 SUZLON ENERGY LTD.

Conceived in 1995 with just 20 people, Suzlon is now a leading wind power company with: Over 16,000 people in 25 countries Operations across the Americas, Asia, Australia and Europe Fully integrated supply chain with manufacturing facilities in three continents
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 Sophisticated R&D capabilities in Belgium, Denmark, Germany, India and The Netherlands Market leader in Asia, Suzlon Market Share (Combined with Repower) rose to 9.8% thereby making Suzlon 3rd * largest wind turbine manufacturing company in the world
1.1

National Thermal Power Corporation

NTPC Limited (formerly National Thermal Power Corporation) (BSE: 532555, NSE: NTPC) is the largest state-owned power generating company in India. Forbes Global 2000 for 2009 ranked it 317th in the world. It is an Indian public sector company listed on the Bombay Stock Exchange although at present the Government of India holds 84.5%(after divestment the stake by Indian government on 19october2009) of its equity. With a current generating capacity of 31134 MW, NTPC has embarked on plans to become a 75,000 MW company by 2017. It was founded on November 7, 1975. NTPC's core business is engineering, construction and operation of power generating plants and providing consultancy to power utilities in India and abroad. The total installed capacity of the company is 31134 MW (including JVs) with 15 coal based and 7 gas based stations, located across the country. In addition under JVs, 3 stations are coal based & another station uses naphtha/LNG as fuel. By 2017, the power generation portfolio is expected to have a diversified fuel mix with coal based capacity of around 53000 MW, 10000 MW through gas, 9000 MW through Hydro generation, about 2000 MW from nuclear sources and around 1000 MW from Renewable Energy Sources (RES). NTPC has adopted a multi-pronged growth strategy which includes capacity addition through green field projects, expansion of existing stations, joint ventures, subsidiaries and takeover of stations.

1.4 TATA POWER LTD

Recognised as Indias largest private sector power utility, with a reputation for trustworthiness, built up over nearly nine decades, Tata Power surges ahead into yet another year with plans of sustained growth, greater value to consumer and reliable power supply. Led by a powerful vision, Tata Power pioneered the generation of electricity in India. It has now successfully served the Mumbai consumers for over ninety years and has spread its footprints across the nation. Today, it is the countrys largest private player in the sector. Apart from Mumbai and Delhi, the company has generation capacities in Jojobera, Jharkhand and Karnataka. Tata Power has an installed power generation capacity of about 3000 Mega Watts, with the Mumbai power business, which has a unique mix of Thermal and Hydro Power, generated at the Thermal Power Station, Trombay, and the Hydro Electric Power Stations at Bhira, Bhivpuri and Khopoli, accounting for 1797 MW. Its diverse generation capability
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facilitates the company in producing low cost energy, thereby giving its consumers a greater value for money. Among its many achievements that Tata Power can proudly boast of are the installation and commissioning of Indias first 500 MW unit (at its Thermal Power Generating Station, Trombay) the 150 MW Pumped Storage Unit at its Hydro Generating Station, Bhira, and environmental control systems like the Flue Gas Desulphurisation plant. Tata Power has a first of its kind joint venture with Power Grid Corporation of India for the 1200 km Tata Transmission Project.

1.5 TORRENT POWER LTD

Torrent Power is one of the leading brands in the Indian power sector, promoted by the Rs. 8200 crore Torrent Group a group committed to its mission of transforming life by serving two of the most critical needs healthcare and power. Torrent Pharmaceuticals Ltd., the flagship company of the Torrent Group, is a major player in the Indian pharmaceuticals industry with a vision of becoming a global entity in the arena. With an all-round experience in generation, transmission and distribution of power, and a proven track record of implementing large power projects, Torrent Power is the most experienced private sector player in Gujarat. Torrent Power foresaw the prospects in the power sector much before the liberalization, when it took-over an ailing power cable company in 1989 (now known as Torrent Cables Limited) and successfully turned it around. The high points of Torrents foray into power however were the acquisitions of two of the Indias oldest utilities The Surat Electricity Company Ltd and The Ahmedabad Electricity Company Ltd. Torrent turned them into first rate power utilities comparable with the best, in terms of operational efficiencies and reliability of power supply. Torrent has a generation capacity of 1647.5 MW and distributes power to more than 3 million customers annually in Ahmedabad, Gandhinagar, Surat, Bhiwandi and Agra. The company is currently implementing a 1200 MW gas based power project at Dahej in South Gujarat. The project, called the DGEN Power Project, is being implemented in a phased manner starting with a 400 MW first phase. It is also in the process of expanding the capacity of its SUGEN plant near Surat. Distribution Franchise business is one area which Torrent Power has been aggressively pursuing as part of its expansion plans. Torrent Power created history by entering into the countrys first distribution franchisee agreement with Maharashtra State Electricity Distribution Company Limited for Bhiwandi Circle in December 2006. It has also been awarded
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the distribution franchise for Agra and Kanpur in Uttar Pradesh and has already commenced distribution operations in Agra.

1.6 BHEL LTD

BHEL is the largest engineering and manufacturing enterprise in India in the energy-related/infrastructure sector, today. BHEL was established more than 40 years ago, ushering in the indigenous Heavy Electrical Equipment industry in India - a dream that has been more than realized with a well-recognized track record of performance. The company has been earning profits continuously since 1971-72 and paying dividends since 1976-77. BHEL manufactures over 180 products under 30 major product groups and caters to core sectors of the Indian Economy viz., Power Generation & Transmission, Industry, Transportation, Renewable Energy, etc. The wide network of BHEL's 14 manufacturing divisions, four Power Sector regional centres, over 100 project sites, eight service centres, 18 regional offices and one subsidiary enables the Company to promptly serve its customers and provide them with suitable products, systems and services -- efficiently and at competitive prices. The high level of quality & reliability of its products is due to the emphasis on design, engineering and manufacturing to international standards by acquiring and adapting some of the best technologies from leading companies in the world, together with technologies developed in its own R&D centres. BHEL has acquired certifications to Quality Management Systems (ISO 9001), Environmental Management Systems (ISO 14001) and Occupational Health & Safety Management Systems (OHSAS 18001) and is also well on its journey towards Total Quality Management. BHEL has Installed equipment for over 90,000 MW of power generation -- for Utilities, Captive and Industrial users. Supplied over 2,25,000 MVA transformer capacity and other equipment operating in Transmission & Distribution network up to 400 kV (AC & DC). Supplied over 25,000 Motors with Drive Control System to Power projects, Petrochemicals, Refineries, Steel, Aluminium, Fertilizer, Cement plants, etc. Supplied Traction electrics and AC/DC locos to power over 12,000 kms Railway network. Supplied over one million Valves to Power Plants and other Industries.
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1.

Economic Analysis of Power sector

2.1 GLOBLE SCENARIO With the world population nearly doubling in the past three decades, the present surge in electricity demand, and the projected increase of the global population, the importance of available energy cannot be underestimated. In India, the burning of coal accounts for approximately one half of all electricity generation, nuclear energy approximately one fourth of all electricity generation, and hydro, and gas roughly ten percent of the total electricity generation. Globally, India is presently positioned as the eleventh largest manufacturer of energy, representing roughly 2.4% of the overall energy output per annum. Usually energy, especially electricity, has a major contribution in speeding up the economic development of the country. The existing production of per capita electricity in India is around 600 kWh per annum. Ever since 1990s, Indias gross domestic product (GDP) has been increasing very rapidly and it is estimated that it will maintain the pace in the next couple of decades. The rise in GDP should be followed by an increase in the expenditure of key energy other than electricity. The Report on the Indian Power Sector draws attention the following matters: The aggressive market scenario of the Indian Power Industry. The significance of the role of the private players and foreign investments in the Power sector. Impact of the political condition, collaborations with private participants, new strategies and reforms in regulating the Oil & Gas sector in India. Significance of renewable sources of energy for Power Generation. The different prospects and difficulties faced by the Power Industry. Growing concern about pollution and global warming has led many individuals and nations to consider the nuclear industry as an excellent alternative for future power generation. Technological advancements and increased public awareness concerning nuclear power are critical to the success of the nuclear industry. Investments made by the nuclear industry in both technology and education will likely be seen in the near future. The future power reforms will be in the field of nuclear energy.

2.

Industry Analysis

3.1PORTERS FIVE FORCE MODEL:

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The model of pure competition implies that risk-adjusted rates of return should be constant across firms and industries. However, numerous economic studies have affirmed that different industries can sustain different levels of profitability; part of this difference is explained by industry structure. Porters model is based on the insight that a corporate strategy should meet the opportunities and threats in the organizations external environment. Especially, competitive strategy should base on and understanding of industry structures and the way they change. Supply Many projects have been planned but due to slow regulatory environment, the supply is far lesser than demand. Currently, India needs to double its generation. Many projects have been planned but due to slow regulatory environment, the supply is far lesser than demand. Currently, India needs to double its generation capacity to meet the potential demand.

Demand: The long-term average demand growth rate is 6%. Barriers to Entry: Barriers to entry are high, as entering this business requires heavy investment initially. The other barriers are
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fuel linkages, payment guarantees from State Governments, Retail distribution licensed, etc. Bargaining Power to Suppliers: Not very high as Government controls tariff structure. However, this may change the future. Bargaining Power of Customers: Bargaining power of retail customers is low, as power is in short supply. However, Government is a big buyer and payment by Government can be more erratic. Competition: Not high currently. The Electricity Act, 2003 will encourage investments, thereby increasing competition.

3.2 SWOT ANALYSIS

STRENGHTS AND OPPORTUNITIES OF POWER SECTOR: Well established and vast transmission and distribution network. Highly qualified engineering and technical personnel. Regulatory framework is further facilitated with enactment of Electricity Bill, 2003. The Electricity Bill, 2003 holds promises for the power sector and certainly for the consumer by way of competition reliability and rationalized tariff structure. Emergence of strong and globally comparable central utilities (NTPC, POWERGRID). India has substantial non-conventional energy resource base and technologies to meet growing power requirements by tapping this energy. WEAKNESSES AND THREATS TO POWER SECTOR: Poor infrastructure has led to heavy T&D losses. Old and poor transmission and distribution network has led to frequent power outages and poor quality of power. Lack of proper metering and theft has led to large scale losses. Only 51% of the power generated is billed and only 41% is realized. Moreover, Government provides power to agricultural sector at subsidized rates and also free of cost in some states. All these factors have resulted in financial disorder of the State Electricity Boards (SEBs).

 Restoration of SEBs financial health and improvement in their operating performance continues to be a critical issue. The Government of India has signed a Memorandum of Understanding (MOU) with various states reflecting the joint commitment of centre and states to undertake reforms in a time bound manner. Poor return to utilities, which affect their profitability and capacity to make further investments. Increasing gap between unit approximately Rs 1.10/ unit. cost of supply & revenue,

Managerial and financial inefficiencies in state sector utilities have adversely affected capacity addition and systems improvement. Non-availability of quality coal may hamper thermal plants efficiency in power generation. Inability of SEBs to raise funds, as most of the SEBs is on the verge of bankruptcy due to poor operational performance. Adding to the problems, SEBs need huge money to measure up competition from efficient private players.

1.

Company Analysis 4.1 Ratio Analysis

Key Financial Ratios of BHEL

Mar '06 Investment Valuation Ratios Face Value 10.00 Dividend Per Share 14.50 Operating Profit Per Share 90.85 (Rs) Net Operating Profit Per 549.17 Share (Rs) Free Reserves Per Share 267.56 (Rs) Bonus in Equity Capital -Profitability Ratios Operating Profit Margin(%) 16.54

------------------- in Rs. Cr. -------------------

Mar '07

Mar '08

Mar '09

Mar '10

10.00 24.50 144.84 709.38 348.80 -20.41

10.00 15.25 76.54 399.19 209.99 50.00 19.17

10.00 17.00 85.43 543.68 254.23 50.00 15.71

10.00 23.30 122.49 678.75 315.11 50.00 18.04

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Profit Before Interest And 14.36 Tax Margin(%) Gross Profit Margin(%) 18.11 Cash Profit Margin(%) 13.97 Adjusted Cash Margin(%) 11.71 Net Profit Margin(%) 12.19 Adjusted Net Profit 9.92 Margin(%) Return On Capital 29.35 Employed(%) Return On Net Worth(%) 23.00 Adjusted Return on Net 18.72 Worth(%) Return on Assets Excluding 8.23 Revaluations Return on Assets Including 8.23 Revaluations Return on Long Term 29.35 Funds(%) Liquidity And Solvency Ratios Current Ratio 1.53 Quick Ratio 1.17 Debt Equity Ratio 0.08 Long Term Debt Equity 0.08 Ratio Debt Coverage Ratios Interest Cover 39.28 Total Debt to Owners Fund 0.08 Financial Charges Coverage 43.46 Ratio Financial Charges Coverage 33.77 Ratio Post Tax Management Efficiency Ratios Inventory Turnover Ratio 3.68 Debtors Turnover Ratio 2.05 Investments Turnover Ratio 4.15 Fixed Assets Turnover Ratio 11.87 Total Assets Turnover Ratio 1.72 Asset Turnover Ratio 3.54 Average Raw Material 75.00 Holding Average Finished Goods 11.47 Held Number of Days In Working 178.86

18.47 22.41 14.88 15.07 13.51 13.70 42.84 27.48 27.86 359.06 359.06 42.84 1.43 1.13 0.01 0.01 87.78 0.01 93.42 62.37 4.24 2.06 4.64 14.62 1.97 4.27 78.98 10.27 157.05

16.73 17.65 15.59 15.59 13.87 13.87 41.56 26.53 27.07 220.10 220.10 41.56 1.38 1.09 0.01 0.01 127.55 0.01 135.94 90.12 3.88 1.80 3.88 4.48 1.81 4.48 88.75 12.03 169.89

13.93 14.45 12.10 12.10 11.36 11.36 36.95 24.25 23.24 264.32 264.32 36.95 1.36 1.02 0.01 0.01 157.51 0.01 168.40 114.07 3.70 1.90 3.70 5.20 2.05 5.20 80.96 9.74 140.04

16.13 16.66 13.80 13.80 12.55 12.55 41.37 27.08 26.88 325.16 325.16 41.37 1.37 1.04 0.01 0.01 198.19 0.01 211.86 143.35 3.77 1.81 3.77 5.15 2.09 5.15 83.34 9.80 130.02
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Capital Profit & Loss Account Ratios Material Cost Composition 52.81 Imported Composition of 28.71 Raw Materials Consumed Selling Distribution Cost 1.45 Composition Expenses as Composition of 5.27 Total Sales Cash Flow Indicator Ratios Dividend Payout Ratio Net Profit Dividend Payout Ratio Cash Profit Earning Retention Ratio Cash Earning Retention Ratio AdjustedCash Flow Times 24.09 21.02 70.40 74.91 0.35 Mar '06 Earnings Per Share Book Value 68.60 298.31

49.30 30.94 1.27 6.31

53.22 27.73 1.22 4.80

58.56 27.81 1.09 6.70

53.42 35.15 1.06 24.87

28.67 26.04 71.73 74.30 0.03

30.54 27.66 70.07 72.83 0.03

31.02 28.03 67.63 70.87 0.04

30.90 27.93 68.88 71.89 0.03

Mar '07 98.66 359.06

Mar '08 58.41 220.10

Mar '09 64.11 264.32

Mar '10 88.06 325.16

Key Financial Ratios of Suzlon Energy

Mar '06 Investment Valuation Ratios Face Value 10.00 Dividend Per Share 5.00 Operating Profit Per Share 32.62 (Rs) Net Operating Profit Per 131.76 Share (Rs) Free Reserves Per Share (Rs) 87.27 Bonus in Equity Capital 87.59 Profitability Ratios

------------------- in Rs. Cr. -------------------

Mar '07

Mar '08

Mar '09

Mar '10

10.00 5.00 43.28 186.97 118.11 87.52

2.00 1.00 10.71 46.38 44.24 84.12

2.00 -5.77 48.40 41.13 84.04

2.00 --1.26 22.51 33.80 80.89

Operating Profit Margin(%) 24.75 Profit Before Interest And 23.12 Tax Margin(%) Gross Profit Margin(%) 25.00 Cash Profit Margin(%) 22.47 Adjusted Cash Margin(%) 22.51 Net Profit Margin(%) 21.28 Adjusted Net Profit 21.33 Margin(%) Return On Capital 30.44 Employed(%) Return On Net Worth(%) 29.10 Adjusted Return on Net 29.25 Worth(%) Return on Assets Excluding 18.58 Revaluations Return on Assets Including 18.58 Revaluations Return on Long Term 31.89 Funds(%) Liquidity And Solvency Ratios Current Ratio 2.47 Quick Ratio 2.05 Debt Equity Ratio Long Term Debt Equity Ratio Debt Coverage Ratios Interest Cover Total Debt to Owners Fund Financial Charges Coverage Ratio Financial Charges Coverage Ratio Post Tax Inventory Turnover Ratio Debtors Turnover Ratio Investments Turnover Ratio Total Assets Turnover Ratio Asset Turnover Ratio Average Raw Material Holding 0.12 0.07 22.61 0.12 17.69 16.23

23.14 21.44 22.72 20.75 21.18 19.41 19.84 25.94 28.58 29.17 129.04 129.04 32.63 1.49 2.40 0.31 0.04 14.09 0.31 12.80 11.91

23.09 21.51 21.85 20.99 20.99 20.09 20.09 16.21 20.39 20.06 46.41 46.41 18.09 1.46 2.12 0.44 0.29 12.97 0.44 12.05 11.57

11.92 10.35 10.55 8.66 8.66 -6.34 -6.34 6.52 -7.24 8.36 43.23 43.23 9.16 0.82 2.19 1.13 0.53 2.39 1.13 2.31 0.15

-5.57 -8.62 -9.18 -23.52 -23.52 -37.89 -37.89 -0.71 -25.30 -17.96 35.90 35.90 -0.83 1.14 2.00 1.36 1.02 -0.14 1.36 0.04 -0.75

Management Efficiency Ratios 3.49 3.35 3.56 1.22 10.53 144.43 3.98 3.03 3.96 14.07 1.12 10.36 122.84 4.71 2.63 4.71 9.65 0.70 9.65 87.97 5.45 1.80 5.45 8.91 0.53 8.91 68.53 4.67 0.91 4.67 2.97 0.27 2.97 88.91
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Fixed Assets Turnover Ratio 15.32

Average Finished Goods -Held Number of Days In Working 236.89 Capital Profit & Loss Account Ratios Material Cost Composition Imported Composition of Raw Materials Consumed Selling Distribution Cost Composition Expenses as Composition of Total Sales Cash Flow Indicator Ratios Dividend Payout Ratio Net Profit Dividend Payout Ratio Cash Profit Earning Retention Ratio Cash Earning Retention Ratio AdjustedCash Flow Times 63.51 54.80 4.43 5.61

-238.43 61.96 58.81 6.08 33.03

-231.59 63.79 57.42 5.53 40.87

-295.05 64.13 65.58 6.99 56.69

-481.33 65.18 61.98 5.22 31.50

20.02 18.96 80.02 81.08 0.39

15.50 14.49 84.84 85.81 0.98

12.36 11.65 87.44 88.18 2.08

---100.00 11.44

------

Mar '06 Earnings Per Share Book Value 28.51 97.63

Mar '07 36.82 129.04

Mar '08 9.47 46.41

Mar '09 -3.13 43.23

Mar '10 -9.08 35.90

Key Financial Ratios of Tata Power

Mar '06 Investment Valuation Ratios Face Value 10.00

------------------- in Rs. Cr. -------------------

Mar '07 10.00

Mar '08 10.00

Mar '09 10.00

Mar '10 10.00

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Dividend Per Share 8.50 Operating Profit Per Share 42.48 (Rs) Net Operating Profit Per 230.0 Share (Rs) 8 Free Reserves Per Share 192.5 (Rs) 2 Bonus in Equity Capital 0.57 Profitability Ratios Operating Profit Margin(%) 18.46 Profit Before Interest And 11.90 Tax Margin(%) Gross Profit Margin(%) 18.25 Cash Profit Margin(%) 18.81 Adjusted Cash Margin(%) 15.40 Net Profit Margin(%) 12.92 Adjusted Net Profit 9.30 Margin(%) Return On Capital 8.69 Employed(%) Return On Net Worth(%) 11.07 Adjusted Return on Net 7.99 Worth(%) Return on Assets Excluding 6.31 Revaluations Return on Assets Including 6.31 Revaluations Return on Long Term 8.72 Funds(%) Liquidity And Solvency Ratios Current Ratio 2.18 Quick Ratio 1.85 Debt Equity Ratio 0.51 Long Term Debt Equity 0.50 Ratio Debt Coverage Ratios Interest Cover 4.86 Total Debt to Owners Fund 0.51 Financial Charges Coverage 6.63 Ratio Financial Charges Coverage 6.89 Ratio Post Tax Management Efficiency Ratios Inventory Turnover Ratio 10.68 Debtors Turnover Ratio 5.20 498.7 Investments Turnover Ratio 6 Fixed Assets Turnover Ratio 1.41 Total Assets Turnover Ratio 0.55

9.50 35.46 248.54 215.63 0.57 14.26 7.79 16.27 18.81 14.85 13.26 9.11 7.61 11.63 7.99 302.42 302.42 7.62 2.22 2.00 0.61 0.60 4.03 0.61 5.55 6.34 13.25 3.88 6,072.41 1.40 0.51

10.50 41.67 267.77 278.20 0.51 15.56 10.38 10.64 12.65 12.65 14.35 14.35 6.96 10.88 5.90 362.04 362.04 7.18 1.78 1.75 0.39 0.34 4.63 0.39 6.23 7.78 18.70 4.09 18.70 0.91 0.53

11.50 50.79 327.74 308.95 0.51 15.49 10.63 10.96 10.88 10.88 12.32 12.32 7.32 10.66 5.56 390.36 390.36 7.67 1.64 1.77 0.61 0.53 3.33 0.61 4.15 4.86 15.49 4.83 15.49 0.81 0.52

12.00 79.16 299.12 -0.47 26.17 18.78 19.44 18.63 19.19 12.84 12.88 9.90 8.99 8.83 447.68 447.68 10.19 2.51 2.26 0.57 0.55 4.02 0.55 5.11 4.37 18.98 3.99 12.04 0.71 0.43
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Asset Turnover Ratio

0.77

0.79 --166.79 70.10 -5.19 2.12 31.60 22.05 54.01 71.79 4.71 Mar '07 35.21 302.73

0.91 --122.89 72.76 -0.59 0.31 30.84 23.02 43.09 65.02 4.02 Mar '08 39.42 362.11

0.81 --123.79 73.86 -0.67 4.47 31.20 22.90 40.16 64.68 6.44 Mar '09 41.65 390.36

0.71 --181.47 60.74 --0.78 34.12 22.68 65.56 77.18 4.14 Mar '10 39.93 447.68

Average Raw Material -Holding Average Finished Goods -Held Number of Days In Working 131.8 Capital 9 Profit & Loss Account Ratios Material Cost Composition 70.43 Imported Composition of -Raw Materials Consumed Selling Distribution Cost 1.19 Composition Expenses as Composition of 1.82 Total Sales Cash Flow Indicator Ratios Dividend Payout Ratio Net 31.41 Profit Dividend Payout Ratio Cash 21.34 Profit Earning Retention Ratio 56.37 Cash Earning Retention 73.65 Ratio AdjustedCash Flow Times 3.84 Mar '06 Earnings Per Share Book Value 30.85 278.6 2

Key Financial Ratios of Torrent Power

Sep '06 Investment Valuation Ratios Face Value 10.00 Dividend Per Share 1.20 Operating Profit Per Share 13.03 (Rs) Net Operating Profit Per 81.72 Share (Rs) Free Reserves Per Share 41.33 (Rs) Bonus in Equity Capital -Profitability Ratios Operating Profit Margin(%) 15.94 Profit Before Interest And 8.21 Tax Margin(%) Gross Profit Margin(%) 16.22 Cash Profit Margin(%) 11.99 Adjusted Cash Margin(%) 11.73 Net Profit Margin(%) 4.63 Adjusted Net Profit 4.37 Margin(%) Return On Capital 12.68 Employed(%) Return On Net Worth(%) 6.95 Adjusted Return on Net 6.55 Worth(%) Return on Assets Excluding 3.96 Revaluations Return on Assets Including 3.96 Revaluations Return on Long Term 12.68 Funds(%) Liquidity And Solvency Ratios Current Ratio 0.68 Quick Ratio 0.59 Debt Equity Ratio 0.24 Long Term Debt Equity 0.24 Ratio Debt Coverage Ratios Interest Cover 6.55 Total Debt to Owners Fund 0.24 Financial Charges Coverage 11.16

------------------- in Rs. Cr. -------------------

Mar '07 10.00 0.40 3.93 29.84 42.39 -13.17 8.40 13.32 9.54 9.28 5.00 4.74 3.35 2.65 2.51 57.26 57.26 3.35 0.57 0.48 0.60 0.60 7.48 0.60 10.84

Mar '08 10.00 1.20 11.51 77.54 45.46 -14.84 10.68 10.80 10.34 10.34 5.70 5.70 8.05 7.30 8.13 61.17 61.17 8.05 0.66 0.57 0.88 0.88 7.31 0.88 9.78

Mar '09 10.00 2.00 15.75 92.35 52.03 -17.04 12.60 12.85 13.34 13.34 9.16 9.16 9.95 12.61 12.70 68.44 68.44 9.95 0.91 0.82 1.01 1.01 4.15 1.01 5.33

Mar '10 10.00 3.00 37.23 124.17 66.22 -29.98 23.95 24.26 19.70 19.70 14.07 14.07 20.97 21.12 21.10 83.82 83.82 20.97 1.04 0.98 0.81 0.81 4.77 0.81 5.84
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Ratio Financial Charges Coverage 8.51 Ratio Post Tax Management Efficiency Ratios Inventory Turnover Ratio 42.04 Debtors Turnover Ratio 9.44 Investments Turnover Ratio 40.74 Fixed Assets Turnover Ratio 1.11 Total Assets Turnover Ratio 1.19 Asset Turnover Ratio 1.38 Average Raw Material -Holding Average Finished Goods -Held Number of Days In Working Capital 60.73 Profit & Loss Account Ratios Material Cost Composition 2.04 Imported Composition of -Raw Materials Consumed Selling Distribution Cost 1.04 Composition Expenses as Composition of -Total Sales Cash Flow Indicator Ratios Dividend Payout Ratio Net 35.32 Profit Dividend Payout Ratio Cash 13.63 Profit Earning Retention Ratio 62.56 Cash Earning Retention 86.06 Ratio AdjustedCash Flow Times 1.34 Sep '06 Earnings Per Share Book Value 3.87 55.71

8.05 9.39 3.76 9.01 0.34 0.33 0.47 ---84.50 2.65 -0.95 -30.01 15.72 68.32 83.83 12.21 Mar '07 1.52 57.26

7.01 -9.73 --0.68 0.99 ---62.36 1.83 -0.92 -31.40 18.46 71.80 82.69 6.62 Mar '08 4.47 61.17

4.80 -9.69 25.70 -0.67 1.00 ---14.64 1.43 -1.01 -27.10 18.70 73.09 81.39 5.48 Mar '09 8.63 68.44

4.73 -11.39 40.43 -0.81 0.77 --5.59 3.09 -0.82 -19.75 14.10 80.23 85.89 2.73 Mar '10 17.71 83.82

Key Financial Ratios of NTPC

Mar '06 Investment Valuation Ratios Face Value 10.00 Dividend Per Share 2.80 Operating Profit Per Share 9.00 (Rs) Net Operating Profit Per 31.71 Share (Rs) Free Reserves Per Share 43.24 (Rs) Bonus in Equity Capital -Profitability Ratios Operating Profit Margin(%) 28.40 Profit Before Interest And 18.66 Tax Margin(%) Gross Profit Margin(%) 32.62 Cash Profit Margin(%) 27.30 Adjusted Cash Margin(%) 24.31 Net Profit Margin(%) 20.20 Adjusted Net Profit 17.20 Margin(%) Return On Capital 12.26 Employed(%) Return On Net Worth(%) 12.95 Adjusted Return on Net 11.02 Worth(%) Return on Assets Excluding 7.84 Revaluations Return on Assets Including 7.84 Revaluations Return on Long Term Funds 12.26 (%) Liquidity And Solvency Ratios Current Ratio 2.11 Quick Ratio 1.84 Debt Equity Ratio 0.46

------------------- in Rs. Cr. -------------------

Mar '07

Mar '08

Mar '09

Mar '10

10.00 3.20 12.32 39.58 47.38 -31.13 22.84 33.28 25.25 24.58 19.39 18.69 14.69 14.13 13.61 58.94 58.94 14.69 2.42 2.18 0.52

10.00 3.50 13.98 44.98 52.34 -31.07 23.44 25.31 23.74 23.74 18.51 18.51 15.15 13.66 13.57 65.81 65.81 15.15 2.36 2.16 0.50

10.00 3.60 12.79 50.91 56.25 -25.11 18.06 19.48 21.10 21.10 18.11 18.11 12.27 13.90 12.18 71.55 71.55 12.27 2.89 2.59 0.59

10.00 3.80 15.09 56.25 62.75 -26.81 19.87 21.10 21.83 21.83 17.72 17.72 12.45 13.69 12.70 77.28 77.28 12.45 2.81 2.50 0.59
1

Long Term Debt Equity Ratio Debt Coverage Ratios Interest Cover Total Debt to Owners Fund Financial Charges Coverage Ratio Financial Charges Coverage Ratio Post Tax

0.46 11.59 0.46 5.04 4.93

0.52 9.49 0.52 6.29 5.35

0.50 10.28 0.50 7.31 5.82

0.59 11.91 0.59 7.97 7.08

0.59 12.18 0.59 8.22 7.11

Management Efficiency Ratios Inventory Turnover Ratio Debtors Turnover Ratio 12.31 23.32 14.10 30.78 30.51 0.82 0.44 0.65 --167.21 0.07 -0.17 -33.59 17.52 33.59 0.70 0.46 0.70 --171.01 0.07 -0.12 -28.21 12.78 28.21 0.67 0.45 0.67 --173.56 0.07 -0.13 -27.54 9.06 27.54 0.70 0.46 0.70 --154.07 0.06 -0.14 --

Investments Turnover Ratio 25.14 Fixed Assets Turnover 0.76 Ratio Total Assets Turnover Ratio 0.40 Asset Turnover Ratio 0.57

Average Raw Material -Holding Average Finished Goods -Held Number of Days In 131.98 Working Capital Profit & Loss Account Ratios Material Cost Composition Imported Composition of Raw Materials Consumed Selling Distribution Cost Composition Expenses as Composition of Total Sales Cash Flow Indicator Ratios Dividend Payout Ratio Net Profit Dividend Payout Ratio Cash Profit Earning Retention Ratio Cash Earning Retention Ratio AdjustedCash Flow Times 0.09 -0.15 --

45.23 33.45 46.91 62.44 2.95

44.11 33.83 54.23 65.20 2.89

45.53 35.33 54.17 64.49 2.86

42.31 32.83 51.75 63.70 3.62

41.94 32.16 54.80 65.96 3.51

2

Mar '06 Earnings Per Share Book Value 7.06 54.53

Mar '07 8.33 58.94

Mar '08 8.99 65.81

Mar '09 9.95 71.55

Mar '10 10.59 77.28

2.

TECHNICAL ANALYSIS 5.1 BHEL

Stock Technical SMA-7: 2236.89 SMA-13: 2205.22 SMA-26: 2303.78 SMA-50: 2415.94 SMA-200: 2424.42 EMA-12: 2242.61 EMA-26: 2291.36 EMA-50: 2354.56 EMA-200: 2387.25 MACD: -48.75

2.2SUZLON LTD

Stock Technical SMA-7: 50.59 SMA-13: 49.35 SMA-26: 52.16 SMA-50: 54.88 SMA-200: 59.80 EMA-12: 50.09 EMA-26: 51.63 EMA-50: 53.08 EMA-200: 61.42 MACD: -1.54

5.3 TATA POWER

Stock Technical SMA-7: 1292.67 SMA-13: 1293.50 SMA-26: 1329.08 SMA-50: 1367.23 SMA-200: 1324.50 EMA-12: 1299.04 EMA-26: 1320.80 EMA-50: 1335.11 EMA-200: 1318.25 MACD: -21.76

5.4 TORNT POWER

Stock Technical SMA-7: 287.09 SMA-13: 286.01 SMA-26: 287.06 SMA-50: 301.43 SMA-200: 320.52 EMA-12: 285.83 EMA-26: 289.67 EMA-50: 298.92 EMA-200: 308.34 MACD: -3.84

5.5 NTPC
3

Stock Technical SMA-7: 188.28 SMA-13: 184.60 SMA-26: 187.24 SMA-50: 196.28 SMA-200: 200.64 EMA-12: 187.49 EMA-26: 188.86 EMA-50: 192.76 EMA-200: 199.65 MACD: -1.37

Closing Price of Selected Stocks of BSE

Date 4/1/2009 5/4/2009 6/1/2009 7/1/2009 8/3/2009 9/1/2009 10/1/200 9 11/3/200 9 12/1/200 9 1/4/2010 2/1/2010 3/2/2010 4/1/2010 5/3/2010 6/1/2010 7/1/2010 8/2/2010 9/1/2010 10/1/201 0 11/1/201 0 12/1/201 0

BHEL Close 1651.75 2174.9 2204.35 2228.05 2314.7 2325.15 2217.1 2244.55 2406.1 2406.45 2352.15 2385.45 2492.1 2356.65 2460.7 2438.9 2408.2 2483.6 2445.7 2205.75 2228.8

SUZLON Close 63.65 97.65 103.7 99.75 93.75 91.65 66.9 78.45 90.35 77.25 71.8 71.9 68.95 56.3 57.9 56.5 46.3 52.3 55.45 47.6 48.45

TATA POWER Close 893.95 1,070.30 1,149.70 1,302.05 1,308.80 1,319.45 1,343.20 1,348.95 1,377.95 1,305.80 1,212.95 1,372.60 1,350.00 1,272.10 1,305.55 1,319.80 1,224.45 1,354.30 1,394.60 1,290.30 1,281.70

TORRENT POWER Close 99.3 143.2 167.35 220.7 228.5 317.85 283.4 320.7 322.35 290.5 293.7 288.85 304.45 322.9 333.65 345.6 337.35 323.35 292.05 282.55 281.9

NTPC Close 190.15 215.45 195.05 215.6 212.65 213.7 211.4 209.75 235.70 214.25 203 207 206.95 202 199.15 198.6 195.75 216.9 194.95 184.25 192.2

Returns of Selected Stocks of BSE

TATA POWER 0 0.19727054 1 0.07418480 8 0.13251282 9 0.00518413 3 0.00813722 5 0.01799992 4 0.00428082 2 0.02149820 2 -0.05236039 0.07110583 6 0.13162125 4 0.01646510 3 0.05770370 4 0.02629510 3 0.01091494 TORRENT POWER 0 0.442094663 0.168645251 0.318792949 0.035342093 0.391028446 -0.108384458 0.13161609 0.005144995 -0.098805646 0.011015491 -0.016513449 0.05400727 0.060601084 0.033292041 0.035815975

BHEL 0 0.31672468 6 0.01354085 2 0.01075146 9 0.03889051 0.00451462 4 -0.04647012 0.01238103 8 0.07197433 8 0.00014546 4 0.02256435 8 0.01415726 0.04470854 6 0.05435175 2 0.04415165 6 0.00885926

SUZLON 0 0.53417124 9 0.06195596 5 0.03809064 6 0.06015037 6 -0.0224 -0.2700491 0.17264574 0.15168897 4 0.14499169 9 0.07055016 2 0.00139275 8 0.04102920 7 -0.18346628 0.02841918 3 -0.02417962

NTPC 0 0.13305285 3 0.09468554 2 0.10535760 1 0.01368274 6 0.00493769 1 0.01076275 2 0.00780510 9 0.12371871 3 0.09100551 5 0.05250875 1 0.01970443 3 0.00024154 6 0.02391882 1 0.01410891 1 0.00276173 1

8 0.01258764 2 0.03130969 2 0.01526010 6 -0.09811097 0.01044996

0.18053097 3 0.12958963 3 0.06022944 6 0.14156898 1 0.01785714 3

0.07224579 5 0.10604761 3 0.02975707 -0.07478847 0.00666511 7

-0.023871528 -0.041499926 -0.096799134 -0.032528677 -0.002300478

7 0.01435045 3 0.10804597 7 0.10119870 9 0.05488586 8 0.04314789 7

BHEL AVG RETURN SD 0.017774 794 0.078236 319

SUZLON 0.0009528 48 0.1668208 75

TATA POWER 0.0207185 03 0.0732195 12 TATA POWER 0.279003 837 0.253639 83

TORRENT POWER 0.063334653 0.152352208 TORRENT POWER 1.089486677 0.527763531

NTPC 0.0028024 35 0.0680129 62

BHEL Annual R Annual SD 0.235436 112 0.271018 558

SUZLON 0.011374 44 0.577884 463

NTPC 0.034152 436 0.235603 812

Returns and Standard Deviation

Annual R BHEL SUZLON TATA POWER TORRENT POWER NTPC 0.2354 -0.0114 0.2790 1.0895 0.0342 Annual S D 0.2710 0.5779 0.2536 0.5278 0.2356 1

Correlation Matrix
TATA POWER TORRENT POWER

BHEL BHEL SUZLON TATA POWER TORRENT POWER NTPC 1 0.8584365 5 0.6699524 66 0.5770072 0.5915960 93

SUZLON

NTPC

1 0.6871680 61 0.5442194 09 0.5390408 7

1 0.51316820 8 0.60159861 7

1 0.4288862 69

Bibliography

http://www.in.finance.yahoo.com http://www.buzzingstocks.com