Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.

Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
BSES vs TEC: 1QFY01 reportcard - Views on News from Equitymaster
  • E-MAIL
  • A  A  A
  • Aug 7, 2000

    BSES vs TEC: 1QFY01 reportcard

    Its time to evaluate the first quarter results of the two major power utilities, BSES and Tata Electric Companies (TEC) vis--vis each other. Their results have much in common. For one, both companies reported healthy growth in their core business of selling electrical energy, compared to their correponding quarters' in the previous year (BSES-16% and TEC-29%).

    But both failed to translate this into profit growth, but for entirely different reasons. In case of BSES, its EPC (Engineering, Procurement and Construction), contracts and computer division income took a 77% hit. This deflated its profitability to a large extent. Another reason for this was a significant 45% jump in the cost of electrical energy purchased. As a result, its 1QFY01 bottomline declined, albeit by a marginal 1%.

    On the other hand, a huge 82% jump in fuel costs played spoilsport in TEC's bottomline growth. Its net profit in 1QFY01 grew by a marginal 5%. As a result, net profit margins of both companies declined. For BSES margins declined by 270 basis points and TEC's declined by 230 basis points.

    Sales 5,879 8,663 67.9%
    Other Income 265 488 54.2%
    Expenditure 4,429 6,786 65.3%
    Operating Profit (EBDIT) 1,450 1,878 77.2%
    Operating Profit Margin (%) 24.7% 21.7%  
    Interest 176 581 30.2%
    Depreciation 475 512 92.8%
    Profit before Tax 1,064 1,273 83.6%
    Tax 200 446 44.8%
    Profit after Tax/(Loss) 864 827 104.4%
    Net profit margin (%) 15.9% 9.5%  
    No. of Shares (eoy) (m) 137.8 225.3  
    Earnings per share* 25.1 14.7  

    But here the similarity ends. On the operational front, BSES turns out to be superior to TEC. Though BSES's operational income is almost 70% of the TEC, its net profit is more than TEC. This is because TEC's cost of funds (interest costs) are more than 3 times BSES.

    Both companies have intentions of making huge investments in the power sector, telecommunications and broadband services. But here, BSES's better operational efficiency track record will stand it in good stead.



    Equitymaster requests your view! Post a comment on "BSES vs TEC: 1QFY01 reportcard". Click here!


    More Views on News

    NTPC: Higher Tax Provision Impacts Profits (Quarterly Results Update - Detailed)

    Mar 30, 2017

    NTPC declared results for the quarter ended December 2016. The company reported revenue growth of 10.9% while profits declined by 7.5% YoY.

    Tata Power: Higher regulatory & taxation costs hit bottomline (Quarterly Results Update - Detailed)

    Dec 28, 2015

    Tata Power declared its results for the quarter ended September 2015. The company's standalone revenues rose 16.3% YoY. However, net profits declined 9% YoY.

    Tata Power: Higher tax & finance costs hit bottomline (Quarterly Results Update - Detailed)

    Oct 6, 2015

    Tata Power declared its results for the quarter ended June 2015. The company's standalone revenues and profits fell by 3% and 5.3% YoY during the quarter.

    More Views on News

    Most Popular

    This Small Cap Can Drive Chinese Players Out of India (and Make a Fortune in the Process)(The 5 Minute Wrapup)

    Aug 17, 2017

    A small-cap Indian company with high-return potential and blue-chip-like stability is set to supplant the Chinese players in this niche segment.

    The Most Important Innovation in Finance Since Gold Coins(Vivek Kaul's Diary)

    Aug 10, 2017

    Bill connects the dots...between money and growth, real money and real resources, gold and cryptocurrencies...and between gold, cryptocurrencies, and time.

    Signs of Life in the India VIX(Daily Profit Hunter)

    Aug 12, 2017

    The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.

    Bitcoin Continues Stellar Rise(Chart Of The Day)

    Aug 10, 2017

    Bitcoin hits an all-time high, is there more upside left?

    5 Steps To Become Financially Independent(Outside View)

    Aug 16, 2017

    Ensure your financial Independence, and pledge to start the journey towards financial freedom today!

    Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
    Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

    LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

    SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

    Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
    Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407

    Become A Smarter Investor In
    Just 5 Minutes

    Multibagger Stocks Guide 2017
    Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
    We will never sell or rent your email id.
    Please read our Terms


    Aug 22, 2017 (Close)


    • Track your investment in TATA POWER with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
    • Add To MyStocks


    Compare Company With Charts