BHEL’s dues from power companies hit record high of Rs.40k crore

BHEL’s dues from power companies hit record high of Rs.40k croreGovernment-run heavy equipment maker Bharat Heavy Electricals Ltd (BHEL) has confirmed that its dues from power companies have hit a record high of Rs 40,000 crore.

BHEL is bearing the brunt of solvency of the power sector, which has been suffering due to persistent bottlenecks in various areas, such as land acquisition, financial health of state electricity boards, and absorption of additional costs by end-users.

Confirming the record high dues, BHEL Chairman B Prasada Rao said, "Our receivables from power companies right now is Rs 40,000 crore and half of this amount is already due for payment."

Provisional financial results for 2012-13 also showed that the company suffered a decline of 8 per cent in its net profit from the previous year while turnover growth remained unchanged at just 1 per cent.

The company's earning before interest, tax & amortization (Ebita) margin was pegged at 21 per cent, 2 per cent lower than the figure reported in the previous year. A senior company official attributed the decline in the margin to increased competition in the market after entry for private players JSW, Larsen & Toubro and Bharat Forge.

However, investors shrugged off the negative data. Stock in BHEL gained 2.73 per cent to Rs 182.65 a share on the National Stock Exchange (NSE) in the after-hours trading on Monday.