Unleashing Sustainable Solutions for New India
Your Company and its subsidiaries serves over 4.4 million customers
through its distribution licensees in Kolkata and Greater Noida, as well as its four
distribution franchisees in Rajasthan and Maharashtra
Dear Members,
2023-24 has been an excellent year for India's economy. In a
milieu where the global economy grew at 3.2% for calendar year 2023, India's real
gross domestic product (GDP) grew at 7.6% in 2023-24, up 60 basis points from 2022-23. It
happens to be the highest growth rate recorded among all major economies in the world,
including China. Not just in 2023-24; but also in the previous year.
Given this buoyant growth scenario, the Reserve Bank of India (RBI) has
forecast India's GDP growth for 2024-25 at 7% which seems to be a little
conservative. Indeed, I expect a higher growth. But even at 7%, it will make India the
fastest growing large economy in 2024-25, for the third year on a trot.
In such healthy economic circumstances, electricity demand has been
strong after the pandemic. With recent trends in the energy consumption tilting towards
greater electricity usage, this is expected to improve further.
Your Company and its subsidiaries are well placed to benefit from this
opportunity. Its presence has grown considerably over the years. Today, it serves over 4.4
million customers through its distribution licensees in Kolkata and Greater Noida, as well
as its four distribution franchisees in Rajasthan and Maharashtra. It has generation
plants in West Bengal, Maharashtra and Tamil Nadu with a cumulative capacity of about 2140
MW.
Towards the end of 2023-24, your Company articulated its intent to
enter the renewables energy generation space across multiple technologies. Its footprint
in India's power sector will increase significantly as its investments in the
renewables space come to fruition.
Let me now cover how your Company fared in 2023-24. Here are some
facts.
For the Kolkata operations, there was a significant growth in demand.
Peak power demand increased to 2,606 MW in 2023-24 versus 2,339 MW in the previous year.
Total energy requirement grew by 5.4 % to 11, 775 MU in 2023-24. Over 108,000 new
connections were provided in 2023-24 and there was a notable increase in online payments
and customer interactions through digital channels. The generating stations won several
awards relating to operating efficiencies, energy conservation, quality systems and
processes. These are detailed in the chapter on Management Discussion and Analysis.
Outside of the Kolkata operations: the five operational distribution
ventures of your Company — at Greater Noida, Kota, Bharatpur, Bikaner and Malegaon
— have collectively serviced some 8.1 lakh consumers (versus 7.6 lakh in 2022-23) and
accounted for electricity sales of 6,365 MU in 2023-24, up by 4.1% over the previous year.
Distribution losses have reduced across all five operations; while overall collection
efficiency has increased.
Consequently, your Company has reported creditable results for 2023-24.
Total income (including other income) of CESC as a consolidated entity grew by 6.8% to Rs.
15,544 crore in 2023-24. Total expenses during the year increased by 10.8%. As a result,
consolidated profit before taxes (PBT), after incorporating regulatory income, stood at
1,683 crore in 2023-24 Consolidated profit after taxes (PAT) grew by 3.6% to Rs. 1,447
crore in 2023-24. I believe that there are more improvements to be had. Unlike in most
other businesses, we are always constrained to raise power tariffs. However, we aim to
further improve operational and customer efficiencies in the Kolkata business.
We also strive to generate stronger results from our five distribution
ventures outside West Bengal by rapidly reducing distribution losses and by strengthening
billing and collections. We also envisage increasing the use of various digital
interventions both in maintenance and customer care to provide better servicing while
simultaneously reducing costs.
Let me end with a simple observation on the future of the power sector.
If India continues to grow at 7.5% to 8% per year over the next few years, there is
absolutely no doubt that there will be a steadily rising demand for power. Your Company is
well placed to supply this increasing demand. It has strong capabilities and presence,
which are set to increase further with its planned investments in the renewables space.
Therefore, I see no reason why the operational and financial results should not improve
further. It can. And it must.
Thank you for your support. I truly appreciate it.
The very best.
Yours sincerely,
Dr Sanjiv Goenka
Chairman