Alstom Projects was bound to rise today after it declared a sterling 88.3% rise in net profit on Friday.
The solid outcome prompted a 2.34% to Rs 104.90 rise in the scrip of the power major by 10:00 IST. However, volumes were not as inspiring, as just 650 shares were traded on BSE till then. The scrip of the power equipment company has now risen 130.5% from Rs 45.50 on 31 March 2003.
On Friday, after market hours, the company said Q4 ended 31 March 2003 net profit grew 88.3% to Rs 38.75 crore (Rs 20.58 crore) on a 20.3% increase in net sales to Rs 180.58 crore (Rs 150.18 crore).
For FY 2002-03, the company's net profit rose marginally though, by 2.6% to Rs 64.67 crore (Rs 63.02 crore) on a 48.3% fall in net sales to Rs 585.39 crore (Rs 1,131.65 crore). On a consolidated basis, the Alstom Projects group's net profit works out to Rs 60.40 crore (Rs 59.08 crore) on total income of Rs 631.46 crore (Rs 1,164.77 crore) for the year ended 31 March 2003. The company also declared a dividend of Rs 3 per share for FY 2002-03.
Alstom Projects India is engaged in the business of design, engineering, manufacturing, procurement, supply, commissioning, servicing and renovation and modernisation of power plants for utility and industrial users. It is also engaged in the development and supply of air pollution control systems, equipment for pollution control and conservation of energy.
Recently, the company announced the completion of the amalgamation of Alstom Power Boilers, Alstom Transport and Alstom Systems with itself. The scheme of amalgamation is effective from 31 March 2001.
The merger is expected to result in enhanced ability of the company to submit competitive integrated business proposals and provide total system solutions.
Meanwhile, the implementation of the Electricity Act has boosted the scrip of late. The Act aims at setting off power sector reforms in three radical ways. It makes the continued existence of bundled SEBs conditional on occurrence of centre, mandates open access in distribution apart from allowing parallel distribution systems to be set up where required, and extends the scope of captive generation to cooperative groups and associates.
The Electricity Act is expected to engender an improvement in the health of State Electricity Boards (SEBs). The Electricity Act will also give a big boost to the power sector as it is a comprehensive legislation putting together all the legislative measures required to push the power sector onto a trajectory of sound commercial growth. It envisages a competitive scenario, where regulators, on the one hand, and private power utilities, on the other, play increasingly significant roles. The bill provides a comprehensive yet flexible legislative framework for power development.
The Union Budget for 2003-04 has also provided cheer for the power sector following the thrust on infrastructure (deemed as one of the five key focus areas for future development), improvement in power distribution and attention on capacity addition. The Government had , in 1999, notified 18 power projects as mega projects, conferring upon them various duty and licensing benefits. The Government now proposes to liberalise the mega power project policy further by extending all these benefits to any power project that fulfills the conditions already prescribed for mega power projects.
Given the importance of transmission in the power sector, customs duty on specific equipment for high voltage transmission projects has been reduced to 5% from 25% earlier. To further research in solar energy, wind turbines and hydrogen fuel as alternatives to fossil fuels, the Government is especially allocating Rs 20 crore to the Council for Scientific and Industrial Research, for launching incentive-driven research in these three fields.
As on 31 March 2003, the promoter held 66.48% stake in the company, while the public and institutions held 13.30% and 14.38%, respectively.
