LETTER FROM THE CHAIRMAN & MANAGING DIRECTOR
"Our commitment to shareholders is reflected in our pursuit of ongoing growth and
enduring value. "
Dear Shareholders,
It is my great pleasure to write to you following a remarkable year of growth across
our businesses, highlighting our strong financial health and operational excellence. Our
commitment to shareholders is reflected in our pursuit of ongoing growth and enduring
value, and as we reflect on the past year, I am pleased to share the significant strides
POWERGRID has made in delivering value to stakeholders. This achievement has been made
possible through a culture of innovation, continuous improvement, and global outlook.
I am proud to report that we surpassed a market capitalization of ! Rs.3 lakh crore in
May 2024, a significant milestone achieved in a short span from ! Rs.2 lakh crore in
December 2023. In the last four years, POWERGRID's market capitalization has increased by
an impressive 210%. The consolidated income of your Company for the year reached Rs.46,913
crore, resulting in a Profit After Tax (PAT) of Rs.15,573 crore. This year, we paid a
dividend of !H0,463 crore, compared to Rs.10,289 crore last year, representing 68% of our
PAT, up from 67% the previous year. This reflects our commitment to balancing dividend
payments with retained earnings to support future growth.
Your Company issued Bonus Shares in the ratio of 1:3 during FY 2023-24.
We maintain our leadership position in transmission system in India and continue
driving the energy transition. Our transmission network spans the entire country,
encompassing over 1,77,000 circuit kilometers of transmission lines and 278 substations
with a transformation capacity of over 5,27,000 MVA. Our interregional capacity stands at
approximately 99,580 MW, accounting for an impressive 84% of the total interregional
capacity of the country.
This robust infrastructure is supported by state of the technologies like 765kV and
400kV EHVAC substations, LCC as well as VSC HVDC stations, and advanced reactive power
management systems that utilize SVCs and STATCOMs.
Our commitment to minimise the environmental footprint is evident from the fleet of GIS
substations for areas with limited land, employing technology up to 765kV.
High Transmission system availability is essential for enabling secure energy
transition. Last year, we achieved transmission system availability of 99.85%, one of the
highest globally, and our tripping rates are also among the best in the world. Our
technical experts work tirelessly to ensure the availability and reliability of India's
power transmission system.
Efficient operation and control of our vast transmission system are managed through the
National Transmission Asset Management Centre (NTAMC) and Regional Transmission Asset
Management Centres (RTAMCs). Our commitment to technology adoption is reflected in our
expenditure of Rs.218.07 crore in Research & Development and innovation initiatives
during the year. We have digitally mapped our assets and the implementation of Reliability
Centered Maintenance, has enabled us to monitor, analyze, and effectively manage our asset
risks. Our Control Center in Manesar houses a Center of Excellence for control and
protection systems, ensuring the security and reliability of our transmission network. We
are excited to announce that POWERGRID is in the process of implementing an Asset
Management Performance system, utilized by leading utilities globally, which is expected
to reduce operational costs by at least 10% while enhancing reliability, security, and
risk management.
Your Company has become the largest transmission utility in the world to receive
ISO-55001 certification, the global standard for Asset management practices.
Your Company has maintained its leadership position in developing the transmission
projects in India. In fiscal year 2024, we aimed for a project execution target of !
Rs.8,800 crore. With invaluable support from our partners, we surpassed expectations,
achieving a Capex of !H2,500 crore, which constitutes over 4% of our Gross Block valued at
approximately ^2,75,000 crore. During the year, POWERGRID added 4,036 circuit kilometers
of Extra High Voltage transmission lines, 19,720 MV A of transformation capacity, and six
new substations. Among the key projects commissioned were the POWERGRID Neemuch
Transmission Limited, the 400kV Mohanlalganj substation, and the 400 kV D/c Lower
Subhansiri - Biswanath Chariyali -II, along with 400 kV 2xD/C Khetri-Bhiwadi and several
others.
Your Company has demonstrated exceptional project management prowess, keeping the
average cost and time overruns well below the industry standards. This has been made
possible despite several challenges pertaining to tough terrain, extreme weather
conditions and RoW issues. Use of technology, active policy advocacy and proactive
planning have been instrumental in overcoming these challenges.
In line with our commitment to sustainable development, we have integrated ESG
principles into our core business operations and adopted our ESG vision and targets. We
are actively working towards achieving our goals of net zero emissions by 2047, 50% of our
energy consumption from renewable sources by 2025, zero waste to landfill by 2030, and
being net water positive by 2030. This year, we witnessed a reduction in scope 1 emissions
and made strides towards replacing diesel vehicles with electric vehicles for our business
operations. Additionally, rainwater harvesting systems have been implemented across our
facilities.
Our commitment to ESG is evident in our robust policies, including an ESG Policy, Water
Management Policy, and Waste Management Policy, along with our Supplier Code of Conduct.
We are continuously exploring greener alternatives, such as phasing out SF6 gas and
adopting technologies like digital substations and drone patrolling to minimize our
environmental impact.
Looking ahead, we are preparing to capture ESG disclosures across our value chain,
further solidifying our commitment to sustainable business practices. Our Green Hydrogen
Pilot Project at Neemrana aims to provide hands-on experience in Green Hydrogen
technologies, with plans for commercial-scale projects in the future. Additionally, we are
implementing a solar power project at Nagda, with a capacity of 85MW/l05MWp.
Your Company has been awarded with Anti-Bribery Management System (ABMS) IS/lSO 37001
certification by the Bureau of Indian Standards (Bis). This reflects our dedication to
governance and integrity.
With a strong order book amounting to over Rs.110,000 crore, we anticipate higher Capex
in the coming years. We are working tirelessly to achieve a capex target of around
Rs.18,000 crore in FY25. In FY 2024, POWERGRID secured 13 ISTS TBCB projects across the
Northern, Western, and Southern regions. In terms of NCT cost, these projects represent
about 65% of the total project bids in FY 2023-24, with an annual tariff accounting for
64% of the total. The cabinet approved the Green
Energy Corridor for Ladakh, including the Pang to Kaithal HVDC and VSC stations with
associated AC transmission lines at Pang and Leh, in FY 2023-24.
We signed MoU with RVPNL, Rajasthan, to develop intrastate transmission projects worth
about Rs.10,000 crore. Similar discussions are ongoing with APTRANSCO, Assam, and Uttar
Pradesh, indicating our plans to develop intrastate transmission systems. We have also
signed a supplementary agreement with Ladakh Power Development Department (lpdd) to
implement border area works of Ladakh UT, sanctioned under the RDSS scheme.
Internationally, POWERGRID has established a strong presence in 23 countries across
South Asia, Central Asia, Africa, and Europe, successfully undertaking projects in some of
the toughest geographies. Our partnership with Africa50 to develop the first PPP mode
transmission project in Kenya exemplifies our commitment to expanding our reach. We are
currently engaged in several international assignments, including projects for TANESCO in
Tanzania, the Zambia Transmission Line in Africa, transmission line construction in Fiji,
work for UETCL in Uganda, and the Nepal Gorakhpur Butwal transmission line for
international cross-border interconnection. Further in the international consultancy
segment, our project in Kenya is progressing well; we have received in-principle approval,
and final details are being worked out, with work expected to commence soon. We anticipate
significant progress in our other business ventures, including solar generation, smart
metering, and data centers.
As we celebrate these achievements, we also take pride in the recognition POWERGRID has
garnered over the year, including the Platts Global Energy Award, International CSR Award,
and Brandon Flail Group Fluman Capital Management Award. Additionally, we have received
accolades such as the SHRM HR Excellence Award for human capital excellence and learning
development. Notably, we have been honored with the esteemed ATD BEST Award 2024 for the
third time, highlighting our strategic use of talent development to achieve
enterprise-wide success. Our commitment to community engagement through extensive CSR
programs has positively impacted numerous lives, and we remain dedicated to improving the
quality of life in the areas where we operate.
I want to take this opportunity to express my heartfelt gratitude to all our employees
for their dedication to the Company, with special recognition to our women employees.
Notably, women in STEM make up 80% of our total women workforce, and women constitute 8%
of POWERGRID's total employee strength.
On behalf of the Board of Directors and the entire team at POWERGRID, I extend my
sincere appreciation for your continued trust and support. We are dedicated to creating
long-term value for you, our valued shareholders, and I look forward to your continued
partnership as we embark on this journey of growth and excellence.
Thankyou for your confidence in POWERGRID.
Your truly,
(Ravindra Kumar Tyagi)
Chairman & Managing Director
Date: 31st July, 2024
Place : Gurugram