Opg Power Ventures Share Discussion Threads

[tim000] 01/9/2023 13:18

Tata Power is up 25% in the past six months as the outlook for gencos improves. OPG is flat over the same period. Positive newsflow for FY23 and H1 FY24 hopefully will start a rerating.

[tim000] 01/9/2023 11:28

Hindubusinessline: “Government aims to supply 112mnt coal via coastal shipping by 2030”. At present the bulk of thermal coal transported by coastal shipping is from MCL mines through Odisha’s Paradip and Dhamra ports to southern India, incl Tamil Nadu. Volumes via this route increased 50% in FY2023 to 42mnt. “Opting for a road to sea to road route could potentially save R760-1300/t in logistics costs for end users located in southern India”. It’s likely that when OPG says it’s looking to increase procurement of domestic coal, this is its route to minimise costs.

[tim000] 31/8/2023 12:58

For the 3 months Aug-Oct, CIL is auctioning a record 6.55mnt of non coking coal under the SHAKTI scheme, ie for gencos without power purchase agreements, with procurement on short term contract of 3-12 months.

[tim000] 31/8/2023 10:33

Economic Times: Indian peak power demand reached an all-time record of 234GW during 17 August, with only slightly lower levels in the preceding week. Contributory factors were low rainfall and high humidity. Use of cooling appliances and irrigation thus spiked. Spot electricity prices on the Indian electricity exchange jumped from R5 to R9.2 per unit between 1st and 18th August.

[tim000] 30/8/2023 07:56

Government mandate for gencos importing coal to maximise output has been extended to October, in the face of record electricity demand in August. The Hindu businessline reports electricity consumption up 21% yoy in August.

[tim000] 28/8/2023 19:41

[Edited/corrected] It seems that OPG is issuing a new, BSE listed, 50 crore (ca £5 mn) NCD, with the same maturity date (Aug 2026) as the existing 75 crore NCD. We will have to wait to hear what the proceeds will be used for, but in view of the company’s strategy of deleveraging, my best guess would be to repay some of its existing bank term loans.
The bond ISIN number is INE0D8F07048

[tim000] 28/8/2023 15:02

“India considers tax breaks for electric vehicles.” EVs account for just 1% of annual vehicle sales currently, but the government is targeting a market share of 30% by 2030. That implies rapid long term growth in electricity demand. Government policies that stimulate electricity demand necessitate a very profitable generation industry.

[tim000] 28/8/2023 08:22

Looks like you’re right, Bubba, the new NCD might not be listed and hence no sign of Q2 results yet.

[tim000] 28/8/2023 08:12

ICI4 price virtually unchanged this week.

[the original goldbug] 28/8/2023 07:03

They have had no margins for a number of years. Even the politicians and bureaucrats in Delhi can see the writing on the wall.

[tim000] 26/8/2023 12:41

Adani Power reported a 250% increase in EBITDA (partly due to late payment fines paid by customers) and an 8pp increase in PLF, from 52% to 60%, between 2023 Q1 and Q2, presumably due to lower coal prices and the government mandate to maximise output starting in March.

[tim000] 26/8/2023 11:35

Given few new thermal power plants are planned, the extra coal production will at least partly substitute for imports, meaning gencos such as OPG will in future switch to much cheaper domestic output. At a time when nearly all industries are suffering margin pressure due to cost inflation, Indian thermal power generators must be almost unique in seeing government policies which aim to slash input costs over the next few years.

[tim000] 26/8/2023 11:14

Coalmint: CIL targets coal production of 1 billion tonnes by FY 2026, a 40% increase compared with FY 2023. 84% of production currently goes to the power sector, which in turn is responsible for 71% of power generation.

[tim000] 25/8/2023 08:02

India’s GDP is estimated to grow by over 8 % in the year to 2023 Q3, and by over 6.5% in fiscal 2024. Household demand for electricity seems to be growing strongly in the face of rising incomes and growing demand for air conditioning given the climate. Construction of new generating capacity seems to be sluggish, with delays in bringing new projects online (Tangedco is criticised for this). So PLFs should be increasing, consistent with government mandates for gencos to maximise output in fiscal H1. So the outlook for OPG looks strong, if investors are willing to wait. Long term dividend yield at current share price should easily be in double figures.

[tim000] 25/8/2023 07:44

Hopefully in time, as management has stated. Coal prices are not homogeneous, they vary from market to market and according to product characteristics, eg calorific value. Australian coal commands a premium, Indian coal a discount due to government policy to keep the price low for local gencos. The key for OPG is the extent to which it has been successful in switching to cheap local coal supplies, especially longer term contracts at FSA rates.

[dave4545] 24/8/2023 22:23

Did you see Bisi interims from £20 mil+ profits to virtually nothing due to price drops after freak year due to the war,

If that is anything to go by then OPG should do the opposite which is huge profits from losses.

[tim000] 24/8/2023 09:42

An article published today in the New Indian Express (“TangedcoR17;s power purchase cost up by Rs 2000 crore every financial year”) quotes a source stating that the current cost of thermal power generation is ca R5 per unit, while Tangedco purchases each unit from gencos at ca R9. Assuming Tangedco’s wholesale pricing to industry is indicative of OPG’s charges, Tangedco’s published tariffs are currently R7.65 per unit.

[tim000] 21/8/2023 09:16

Coal India’s trials of its in-house e-auction system have been completed successfully and will now be rolled out across its operations. Currently e-auctions are run by a third-party JV (including Tara Steel), which OPG has utilised in procuring coal. What I’m most curious to know however is why can’t OPG sign FSA agreements with CIL to procure some of its coal at discounted FSA prices?

[tim000] 21/8/2023 09:06

ICI4 down again, now $50.39/t.

[dave4545] 16/8/2023 15:48

Been weird trades for ages in this one.

It's way cheaper online to buy so it's baffling the full offer trades of that size.

[tim000] 16/8/2023 15:42

Why is someone having to pay 10p for 10k shares? Is there a large buy order being filled?

[dave4545] 15/8/2023 08:56

84K buy orders at 9.2p in auction and 55k at 9p hoping for a cheaper fill

[tim000] 14/8/2023 16:39

You’re right of course the NCD was repaid but a new £7.5mn (ish) NCD was issued to part-finance the repayment. It’s not certain, but I’m hoping the new NCD is also traded on the bse and hence quarterly results will continue to be published. Also, these quarterly releases are now published on the OPG website in the Investors section.

[bubbabubbabubba] 14/8/2023 16:31

It's just blank now the bond has been paid

[bubbabubbabubba] 14/8/2023 16:30

There bse page doesn't exist