Accounting Project on NTPC

By:-
Pijush Kanti Ghata
Prahlad Agarwal
Pranav Mishra
Rinki Kumari
 Outline
 Company in brief

 Shareholding Pattern

 Major Components of Annual Report

 Disclosures

 Few Accounting Policies

 Analysis of Current Assets (2006-09)

 Net Take Away

 Analysis of the Cash Flow Statement (2006-09)

 Net Take Away

 Ratio analysis (Time series and Cross sectional)

 Liquidity Ratio
 Profitability Ratio

National Thermal Power Corporation 2

Company in brief
Type: Public

Founded: 1975

Headquarters: Delhi, India

CMD: R S Sharma

Industry: Electricity Generation

Employees: 23867 (2006)

National Thermal Power Corporation 3

Shareholding Pattern

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 Major Components of Annual Report

 Corporate mission & objectives

 Letter to the Shareholders

 Graphs & State-wise generation

 Financial Statements & Performance

 Director’s Profile

 Management Discussion & Analysis

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 Contd…

 Report on Corporate Governance

 Accounting Policies

 Auditor’s Report

 Awards & Accolades

 Subsidiary Companies

 Consolidated Financial Statements

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 Disclosures
 Related Parties
 Joint Ventures
 Subsidiaries
NTPC Electric Supply Company Ltd

NTPC Vidyut Vyapar Nigam Ltd

NTPC Hydro Ltd

Pipavav Power Development Co Ltd

Kanti Bijlee Utpadan Nigam Ltd

Bharatiya Rail Bijlee Co Ltd

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 Joint Ventures
(Criteria: NTPC’s stake >=50%)

Name of the company Promoter’s Equity Holdings

Nabinagar Power Generating NTPC 50%
Company Pvt Ltd.  
NTPC Bihar
State 50%
Electricity Board
Utility Powertech Ltd. NTPC 50%
 
Reliance
Infrastructure Ltd. 50%
NTPC-SAIL Power Company Pvt Ltd. NTPC 50%
 
SAIL 50%

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 Contd…
NTPC-Alstom Power Services NTPC 50%
Private Ltd.  
Alstom
Power Generation 50%
AG
NTPC Tamil Nadu Energy NTPC 50%
Company Ltd.  
Tamil Nadu
Electricity 50%
Board
Aravali Power Company Pvt Ltd. NTPC 50%
 
Indraprastha
Power 25%

Haryana
Power Corporation 25%

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 Contd…
NTPC-SCCL Global Venture Pvt NTPC 50%
Ltd.  
Singareni
Collieries 50%
Ltd.
NTPC BHEL Power Projects Pvt NTPC 50%
Ltd.  
BHEL 50%

Meja Urja Nigam Pvt Ltd. NTPC 50%

 
Uttar Pradesh
Rajya Vidyut 50%
Utpadan Nigam
Ltd.

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 Few Accounting policies
 Basis of preparation
 Grants-in-aid
 Fixed assets
 Capital work-in-progress
 Foreign currency transactions
 Borrowing cost
 Investments
 Inventories
 Depreciation
 Provision and contingent liabilities

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 Analysis of current
assets (2006-09)
Current
2006-07 2007-08 Change 2007-08 2008-09 Change
Assets

Inventories 25,102 26,757 6.59% 26,757 32,434 21.22%

Sundry
12,523 29,827 138.18% 29,827 35,842 20.17%
debtors
Cash &
bank 133,146 149,332 12.16% 149,332 162,716 8.96%
balance
Other
current 10,580 9,218 -12.87% 9,218 9,792 6.23%
assets
Loans &
40,476 40354 -0.30% 40354 68,469 69.67%
advances
TOTAL 221,827 255,488 15.17% 255,488 309,253 21.04%

Income Statement of NTPC.xls

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 net take away
Inventories Net increase of (21.22% - 6.59%)
14.63%.Imported coal (2.74m
tonnes) to overcome temporary
shortages
Sundry Debtors Excessive increase in the debtors
i.e. 138.18% because of two
reasons:-
• Lower rate of collection from the
debtors in comparison to the
frequency of credit sales

• Irregularity in the payment from

debtors

Cash & Bank Balance Strategic diversification - foray into

manufacturing

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 Contd…

Other Current Assets NTPC is putting more money in

its core current assets

Loans & Advances • Decreased by 0.30% in 2007-08

Reveals that a certain part of the
loan has been paid back by the
borrower

• Increased by 69.67% in 2008-09

Financing of new projects

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 Analysis of cash flow statement

Particulars 2006-07 2007-08 change 2007-08 2008-09 change

Operating
7929.50 9520.60 20% 9520.60 9730 2%
Activities

Investing
(3412.10) (6642.40) -94% (6642.40) (8383.10) -26%
Activities

Financing
573.2 (1215.80) -312% (1215.80) 543.10 144%
Activities
Net Cash
5090.60 1662.40 -67% 1662.40 1890 13%
Flow

Cash flow statement of NTPC.xls

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 Net take away
 Operating Activities
Increased electricity production
Expanded capacity utilization

 Investing Activities
Scaled operations
Acquired strategic assets

 Financing Activities
Retired old debt and negotiated new debt
Paid a higher dividend

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 Ratio analysis
NTPC POWER GRID
CORPORATION

LIQUIDITY

Financial Year 2006-07 2007-08 2006-07 2007-08

Current Ratio: 3.15 3.22 0.49 0.68

Quick Ratio: 2.64 3.23 0.51 0.71

Net Current Assets: 1,51,564 1,76,189 -2,945.94 -1,839.05

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 Contd…
NTPC Power Grid

PROFITABILITY

Net Profit Ratio: 0.27 0.28 0.31 0.29

Return on 0.13 0.16 0.07 0.06

Investment:

Return on Equity: 0.14 0.14 0.11 0.11

Return on Capital 0.15 0.15 0.08 0.10

employed:

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 Thank You!

References:
www.ntpc.co.in
CMIE database (Prowess)

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