Secondary Data for the

Portfolio Management and Fundamental Analysis of The Power Sector

In Partial fulfilment for the requirement of

Summer Internship Programme

In the two year course of

Master of Business Administration

Programme.
Gujarat Technological University

Submitted to:
Prof. Neha Patel

Submitted by:

Kinjal Modha (NR10052) Saloni Shah (NR10091)

INTRODUCTION TO INDIAN POWER SECTOR

The process of electrification commenced in India almost with the developed world, in the 1880s, with the establishment of a small hydroelectric power station in Darjeeling. However, commercial production and distribution started in 1889, in Calcutta (now Kolkata). In the year 1947, the country had a power generating capacity of 1,362 MW. Generation and distribution of electrical power was carried out primarily by private utility companies such as Calcutta Electric. Power was available only in a few urban centers; rural areas and villages did not have electricity. After 1947, all new power generation, transmission and distribution in the rural sector and the urban centers (which was not served by private utilities) came under the purview of State and Central government agencies. State Electricity Boards (SEBs) were formed in all the states. Legal provisions to support and regulate the sector were put in place through the Indian Electricity Act, 1910. Shortly after independence, a second Act -The Electricity (Supply) Act, 1948 was formulated, paving the way for establishing Electricity Boards in the states of the Union. In 1960s and 70s, enormous impetus was given for the expansion of distribution of electricity in rural areas. It was thought by policy makers that as the private players were small and did not have required resources for the massive expansion drive, the production of power was reserved for the public sector in the Industrial Policy Resolution of 1956. Since then, almost all new investment in power generation, transmission and distribution has been made in the public sector. Most of the private players were bought out by state electricity boards. From the installed capacity of only 1,362mw in 1947, has increased to 97000 MW as on March 2000 which has since crossed 100,000 MW mark India has become sixth largest producer and consumer of electricity in the world equaling the capacities of UK and France combined. The number of consumers connected to the Indian power grid exceeds is 75 million. India's power system today with its extensive regional grids maturing in to an integrated national grid, has millions of kilometers of T & D lines criss-crossing diverse topography of the country. However, the achievements of India's power sector growth looks phony on the face of huge gaps in supply and demand on one side and antediluvian generation and distribution system

on the verge of collapse having plagued by inefficiencies, mismanagement, political interference and corruption for decades, on the other. Indian power sector is at the cross road today. A paradigm shift is in escapable- for better or may be for worse.

EMERGENCE OF REGIONAL POWER SYSTEMS

In order to optimally utilise the dispersed sources for power generation it was decided right at the beginning of the 1960s that the country would be divided into 5 regions and the planning process would aim at achieving regional self sufficiency. The planning was so far based on a region as a unit for planning and accordingly the power systems have been deveoped and operated on l regional basis. Today, strong integrated grids exist in all the five regions of the country and the energy resources developed are widely utilised within the regional grids. Presently, the Eastern & North-Eastern Regions are operating in parallel. With the proposed inter-regional links being developed it is envisaged that it would be possible for power to flow anywhere in the country with the concept of National Grid becoming a reality during 12th Plan Period.

GENERATION
India has installed power generation capacity of 1,41,079.84 MW as on January 31, 2008, which is about 100 times the installed capacity of 1362 MW in the year 1947. Power generation has showcased a robust growth rate which is steadily improving year after year. There has been significant improvement in the growth in actual generation over the last few years. As compared to annual growth rate of about 3.1% at the end of 9th Plan and initial years of 10th Plan, the growth in generation during 2006-07 and 2007-08 was of the order of 7.3% and 6.33% respectively. The average shortage of electricity in India every year is approximately between 7-8%.

STRATEGIES
The various strategies followed to achieve the goal in power sector are, Power Generation Strategy with focus on low cost generation, optimization of capacity utilization, controlling the input cost, optimization of fuel mix, Technology up gradation and utilization of Nonconventional energy sources. Transmission Strategy with focus on development of National Grid including Interstate connections, Technology up gradation & optimization of transmission cost. Distribution strategy to achieve Distribution Reforms with focus on System up gradation, loss reduction, theft control, consumer service orientation, quality power supply commercialization, Decentralized distributed generation and supply for rural areas. Regulation Strategy aimed at protecting Consumer interests and making the sector commercially viable. Financing Strategy is to generate resources for required growth of the power sector. Conservation Strategy to optimize the utilization of electricity with focus on Demand Side management, Load management and Technology up gradation to provide energy efficient equipment gadgets. Communication Strategy for political consensus with media support to enhance the general public awareness. To achieve the above objectives National Electric Policy has been designed. To fulfill the objectives of the NEP, a capacity addition of 78,577 MW has been proposed for the 11 plan. This capacity addition is expected to provide a growth of 9.5 % to the power sector. The Tenth Plan for fiscal years 2002 to 2007 targeted a capacity addition of 41,110 MW, which was subsequently revised to 30,641 MW; however at the end of the Tenth Plan period, only 21,180 MW of capacity was added. This shows that India is not upto the mark in achieving the targets of generation. Our planning is perfect but our path to achieve the target is not perfect.
th

TRANSMISSION
Transmission of electricity is defined as bulk transfer of power over a long distance at high voltage, generally of 132 kV. In India bulk transmission has increased from 3708 ckm in 1950 to more than 256,000 ckm today. The Government of India has an ambitious mission of POWER FOR ALL BY 2012. This mission would require that our installed generation capacity should be at least 2, 00,000 MW by 2012 from the present level of 1, 14,000 MW. To be able to reach this power to the entire country an expansion of the regional transmission network and inter regional capacity to transmit power would be essential. The latter is required because resources are unevenly distributed in the country and power needs to be carried great distances to areas where load centres exist. Ability of the power system to safely withstand a contingency without generation rescheduling or load-shedding was the main criteria for planning the transmission system. However, due to various reasons such as spatial development of load in the network, non-commissioning of load centre generating units originally planned and deficit in reactive compensation, certain pockets in the power system could not safely operate even under normal conditions. This had necessitated backing down of generation and operating at a lower load generation balance in the past. Transmission planning has therefore moved away from the earlier generation evacuation system planning to integrate system planning. While the predominant technology for electricity transmission and distribution has been Alternating Current (AC) technology, High Voltage Direct Current (HVDC) technology has also been used for interconnection of all regional grids across the country and for bulk transmission of power over long distances. Certain provisions in the Electricity Act 2003 such as open access to the transmission and distribution network, recognition of power trading as a distinct activity, the liberal definition of a captive generating plant and provision for supply in rural ar are expected to introduce and eas encourage competition in the electricity sector. It is expected that all the above measures on the generation, transmission and distribution front would result in formation of a robust electricity grid in the country.

FUTURE PLANS FOR POWER FOR ALL BY 2012

The countrys transmission perspective plan for eleventh plan focuses on the strengthening of National Power Grid through addition of over 60,000 ckm of Transmission Network by 2012. Such an integrated grid shall carry 60% of the power generated in the country. The existing inter-regional power transfer capacity is 17,000 MW, which is to be further enhanced to 37,000 MW by 2012 through creation of Transmission Super Highways. Based on the expected generation capacity addition in XI plan, an investment of about 75,000 Crore is envisaged in Central Sector and Rs. 65,000 Crore is envisaged in the State Sector. POWERGRID is working towards achieving its mission of Establishment and Operation of Regional and National Power Grids to facilitate transfer of power within and across the regions with reliability, security and economy, on sound commercial principles". The exploitable energy resources in our country are unevenly distributed, like Coal resources are abundant in Bihar/Jharkhand, Orissa, West Bengal and Hydro Resources are mainly concentrated in Northern and North-Eastern Regions. As a result, some regions do not have adequate natural resources for setting power plants to meet their future requirements whereas others have abundant natural resources. Demand for power continues to grow unabated. This calls for optimal utilization of generating resources for sustainable development. Thus, formation of National Power Grid is an effective tool to achieve this as various countries have adopted the model of interconnecting power grid not only at national level but also at international level. Further, acquiring Right of Way (ROW) for constructing transmission lines is getting increasingly difficult, especially in eco-sensitive areas like North-Eastern Region, Chicken neck area, hilly areas in Jammu & Kashmir and Himachal Pradesh. At the same time, these areas are also endowed with major hydro potential of the country. This necessitates creation of Transmission Super Highways, so that in future, constraints in ROW do not cause bottleneck in harnessing generating resources. Inter-connection of these highways from different part of the country would ultimately lead to formation of a high capacity National Power Grid. Thus, developments in power sector emphasize the need for accelerated implementation of National Power Grid on priority to enable scheduled/unscheduled exchange of power as well as for providing open access to encourage competition in power market. Formation of such a National Power Grid has been envisaged in a phased manner.

Initially, considering wide variations in electrical parameters in the regional grids, primarily HVDC interconnections were established between the regions. This was completed in the year 2002, thereby achieving inter-regional power transfer capacity of 5000 MW. In the next phase, inter-regional connectivity is planned to be strengthened with hybrid system consisting of high capacity EHV/UHV AC and HVDC links. Such a National Power Grid is envisaged to disperse power not only from Mega sized generation projects but also to enable transfer of bulk power from one part of the country to another in different operational scenarios say, in varying climatic conditions across the country: Summer, Winter, Monsoon etc. Commissioning of links under this phase has already begun with the commissioning of 2000 MW Talcher-II HVDC Bipole, Raipur Rourkela 400kV D/C AC transmission line having Series Compensation, augmentation of Gazuwaka HVDC (500MW) back to back link and Tala transmission system. The inter-regional transfer capacity of 16,200 MW is available as on date. Further strengthening of National Power Grid is envisaged through high capacity AC EHV lines, 765 kV UHV AC lines/ HVDC lines. This phase is planned to be implemented by 2012 when inter-regional power transfer capacity will be enhanced to about 37,700 MW by the end of XI Plan, depending upon planned growth of generation capacity.

SEGMENTS IN POWER GENERATION

1. THERMAL
Current installed capacity of Thermal Power as of February 28, 2011 is 111,324.48 MW which is 64.75% of total installed capacity.  Current installed base of Coal Based Thermal Power is 92,418.38 MW which comes to 53.75% of total installed base.  Current installed base of Gas Based Thermal Power is 17,706.35 MW which is 10.3% of total installed capacity.  Current installed base of Oil Based Thermal Power is 1,199.75 MW which is 0.9% of total installed capacity. The state of Maharashtra is the largest producer of thermal power in the country.

2. HYDRO POWER
India is blessed with a rich hydro power potential. In the exploitable potential terms, India ranks fifth in the world. Less than 25% of the potential has been developed as of now. A large hydro has four main advantages.

 It is a source of green energy.  It has low variable cost.  It is grid friendly.

 It can also can sub serve other purposes by irrigation, flood control, etc. India has 3 major rivers: the Indus, the Brahmaputra, and the Ganga. It also has three major river systems? Central Indian, west flowing rivers of south India, and east flowing rivers of south India with a total of 48 river basins. The total potential from these river basins is 600TWh (Terawatt Hours) of electricity.

Hydroelectric projects can be classified on the basis of purpose, hydraulic features, capacity, head, constructional features, mode of operation, etc. The main types are 1. ROR (Run of River) There are not large reservoirs; a part of water flow is diverted to the plant which is adjacent to the river. After generation the flow is diverted back to the main flow through the tail race. This type of hydro plants requires a diversion dam and has unregulated water flow. 2. Dam Storage In these types of hydro plants, large reservoirs are created by the construction a sizeable dam across the river and the plants is situated at the toe of the dam. Here, water could be regulated to generate electricity depending upon the demand 3. Pumped Storage These types of plants have two reservoirs, one at the upstream of the power plant and one at the downstream. When there is low peak demand, the water from the reservoir situated downstream is pumped0020back to the upstream reservoir. Various initiatives for accelerated development have been taken up by the central government to harness the hydro potential in India. Some of these are  Hydro Power Policy (1998)  50 000 MW initiative  Preparation of viable models for private sector participation  Ranking of projects  R&M up gradation and life extension programmes  Facilitation for trading and co-operation with other countries  Execution of projects with interstate aspects by Central Public Sector Units

SMALL HYDRO
The word hydro comes from a Greek word meaning water. The energy from water has been harnessed to produce electricity since long. It is the first renewable energy source to be tapped essentially to produce electricity Hydro power currently suffices one fifth of the global electricity supply, also improving the electrical system reliability and stability throughout the world. It also substantially avoids the green house gas emissions, thus complimenting the measures taken towards the climate change issues.

Hydro projects below a specified capacity are known as small hydro. The definition of small hydro differs from country to country, depending on the resources available and the prevalent national perspective. The small hydro atlas shows that the largest of the projects (30 MW) is in US and Canada. Small hydro power has emerged as one of the least cost options of harnessing green energy amongst all the renewable energy technologies. According to the power generated, small hydro power is classified into small, mini/micro and Mico hydro. In India, it is being classified as follows. Small hydro - 2 MW - 30 MW Mini - 100 kW 2 MW Micro - 10 kW - 100 kW Mico hydro - 1 kW - 10 kW

Indira Sagar Dam partially completed in 2008 India was one of the pioneering countries in establishing hydro-electric power plants. The power plants at Darjeeling and Shimsha (Shivanasamudra) were established in 1898 and 1902 respectively and are among the first in Asia. The installed capacity as of 28-2-2011 was approximately 37,367.4 MW. The public sector has a predominant share of 97% in this sector.
 

3. NUCLEAR POWER GENERATION

In India, out of total installed capacity of 126993.97 MW (as on 31 August 2006); the share of nuclear power is 3% at 3900 MW. From the electricity generation point of view, nuclear power plants contributed 17 238.89 GWh out of total electricity generation of 6 17 510.44 GWh during April 2005 -March 2006, amounting to 2.79% of total generation. However, with exponential growth in energy demand coupled with a finite availability of coal, oil, and gas; there is a renewed emphasis on nuclear energy. Moreover, nuclear energy is considered to be an environmentally benign source of energy. Department of Atomic Energy is carrying out nuclear energy programme in India. The Indian Nuclear Power Programme has the following three stages. 1. The first stage, already commercial now, comprised setting up of PHWRs (pressurised heavy water reactors) and associated fuel cycle facilities. PHWRs use natural uranium as fuel and heavy water as moderator and coolant. The design, construction, and operation of these reactors is undertaken by public sector undertaking the NPCIL (Nuclear Power Corporation of India Ltd). The company operates 16 reactors (2 Boiling Water Reactors and 14 PHWRs) with a total capacity of 3900 MWe. 2. In the second stage, it was envisaged to set up FBRs (fast breeder reactors) along with reprocessing plants and plutonium-based fuel fabrication plants. Plutonium is produced by irradiation of Uranium-238. The Fast Breeder Programme is in the technology demonstration stage. Under this stage, the IGCAR (Indira Gandhi Centre for Atomic Research) has completed design of a 500 MWe PFBR (prototype fast breeder reactor) being implemented by BHAVINI (Bharatiya Nabhikiya Vidyut Nigam). 3. The third stage of the Indian Nuclear Power Programme is based on the thoriumuranium-233 cycle. Uranium-233 is obtained by irradiation of thorium. Presently this stage is in technology development phase. The ongoing development of 300 MWe AHWR (advanced heavy water reactor) at BARC (Bhabha Atomic Research Centre) concerns thorium utilization and its demonstration.

Indian nuclear power plants Currently, twenty nuclear power reactors produce 4,780 MW

Wind turbiness in Tamil Nadu

4. SOLAR
India is endowed with rich solar energy resource. The average intensity of solar radiation received on India is 200 MW/km square (megawatt per kilometer square). With a geographical area of 3.287 million km square, this amounts to 657.4 million MW. However, 87.5% of the land is used for agriculture, forests, fallow lands, etc., 6.7% for housing, industry, etc., and 5.8% is either barren, snow bound, or generally inhabitable. Thus, only 12.5% of the land area amounting to 0.413 million km square can, in theory, be used for solar energy installations. Even if 10% of this area can be used, the available solar energy would be 8 million MW, which is equivalent to 5 909 mtoe (million tons of oil equivalent) per year. However, solar energy is a dilute source. The energy collected by 1 m square of a solar collector in a day is approximately equal to that released by burning 1 kg of coal or 1/2 litre of kerosene. Thus, large areas are needed for collection. Besides, the

efficiency of conversion of solar energy to useful energy is low. Therefore, the energy actually available would be order of magnitude lower than the aforementioned estimates. Nonetheless, it is obvious that solar energy can be a good source of meeting energy demands. On the applications side, the range of solar energy is very large. While at the high end there are megawatt level solar thermal power plants, at the lower end there are domestic appliances such as solar cooker, solar water heater, and PV lanterns. Then, in between, there are applications such as industrial process heat, desalination, refrigeration and air-conditioning, drying, large scale cooking, water pumping, domestic power systems, and passive solar architecture. Solar energy can be harnessed to supply thermal as well as electrical energy. Those technologies that use solar energy resource to generate energy are known as solar energy technologies. Solar energy technologies consists of  Solar thermal technologies, which utilize sun's thermal energy and  Solar photovoltaic technology, which convert solar energy directly in to electricity. Solar energy resource: Since the accurate information about solar energy resource at a specific location is crucial for designing appropriate solar system. Solar energy resource assessment becomes an essential activity of any solar energy programme. The first Indian solar thermal power project (2X50MW) is in progress in Phalodi (Rajasthan), and is constructed by CORPORATE ISPAT ALLOY LTD. The solar thermal power plant has cost 4 times as much as the coal based steam thermal power plant, CIAL carried this 2x850 crore solar thermal project. It is the "pioneering of solar energy" in india. India is densely populated and has high solar insolation, an ideal combination for using solar power in India. Much of the country does not have an electrical grid, so one of the first applications of solar power has been for water pumping, to begin replacing India's four to five million diesel powered water pumps, each consuming about 3.5 kilowatts, and off-grid lighting. Some large projects have been proposed, and a 35,000 km area of the Thar Desert has been set aside for solar power projects, sufficient to generate 700 to 2,100 gigawatts.

The Indian Solar Loan Programme, supported by the United Nations Environment Programme has won the prestigious Energy Globe World award for Sustainability for helping to establish a consumer financing program for solar home power systems. Over the span of three years more than 16,000 solar home systems have been financed through 2,000 bank branches, particularly in rural areas of South India where the electricity grid does not yet extend. Launched in 2003, the Indian Solar Loan Programme was a four-year partnership between UNEP, the UNEP Risoe Centre, and two of India's largest banks, the Canara Bank and Syndicate Bank. Announced in November 2009, the Government of India proposed to launch its Jawaharlal Nehru National Solar Mission under the National Action Plan on Climate Change with plans to generate 1,000 MW of power by 2013 and up to 20,000 MW grid-based solar power, 2,000 MW of off-grid solar power and cover 20 million sq metres with collectors by the end of the final phase of the mission in 2020.


5. WIND
The suns energy falling on the earth produces large-scale motions of the atmosphere causing winds, which are also influenced by small scale flows caused by local conditions such as nature of terrain, buildings, water bodies, etc. Wind energy is extracted by turbines to convert the energy into electricity. A small-scale and large-scale wind industry exists globally. The small-scale wind industry caters for urban settings where a wind farm is not feasible and also where there is a need for household electricity generation. The large-scale industry is directed towards contributing to countrywide energy supply. The development of wind power in India began in the 1990s, and has significantly increased in the last few years. Although a relative newcomer to the wind industry compared with Denmark or the US, a combination of domestic policy support for wind power and the rise of Suzlon have led India to become the country with the fifth largest installed wind power capacity in the world.

As of June 2010 the installed capacity of wind power in India was 12009.14 MW, mainly spread across Tamil Nadu (4132.72 MW), Maharashtra (1837.85 MW), Karnataka (1184.45 MW), Rajasthan (670.97 MW), Gujarat (1432.71 MW), Andhra Pradesh (122.45 MW), Madhya Pradesh (187.69 MW), Kerala (23.00 MW), West Bengal (1.10 MW), other states (3.20 MW). It is estimated that 6,000 MW of additional wind power capacity will be installed in India by 2012. Wind power accounts for 6% of India's total installed power capacity, and it generates 1.6% of the country's power. Strategies  Power Generation Strategy with focus on low cost generation, optimization of capacity utilization, controlling the input cost, optimisation of fuel mix, Technology upgradation and utilization of Non Conventional energy sources  Transmission Strategy with focus on development of National Grid including Interstate connections, Technology upgradation & optimization of transmission cost.  Distribution strategy to achieve Distribution Reforms with focus on System upgradation, loss reduction, theft control, consumer service orientation, quality power supply commercialization, Decentralized distributed generation and supply for rural areas.  Regulation Strategy aimed at protecting Consumer interests and making the sector commercially viable.  Financing Strategy to generate resources for required growth of the power sector.  Conservation Strategy to optimise the utilization of electricity with focus on Demand Side management, Load management and Technology upgradation to provide energy efficient equipment / gadgets.  Communication Strategy for political consensus with media support to enhance the general public awareness. WIND RESOURCE IN INDIA The wind resource assessment in India estimates the total wind potential to be around 45 000 MW (mega watt). This potential is distributed mainly in the states of Tamil Nadu, Andhra Pradesh, Karnataka, Gujarat, Maharashtra, and Rajasthan. The

technical potential that is based on the availability of infrastructure, for example the availability of grid, is estimated to be around 13 000 MW. In India, the wind resources fall in the low wind regime, the wind power density being in the range of 250 -450 W/m . It may be noted that this potential estimation is based on certain assumptions. With ongoing resource assessment efforts, extension of grid, improvement in the wind turbine technology, and sophisticated techniques for the wind farm designing, the gross as well as the technical potential would increase in the future. STATUS Wind power has become one of the prominent power generation technologies amongst the renewable energy technologies. TECHNOLOGY TRENDS Use of wind energy started long ago when it was used for grinding. The commercial use of wind energy for electrical power generation started in 1970s. Horizontal axis wind turbines are most commonly used for power generation, although some vertical axis wind turbine designs has been developed and tested. The vertical axis turbines have structural as well as aerodynamic limitations and, hence, are not commercially used. WIND POWER IN INDIA Wind turbines offered in India range from 250 kW to 2 MW capacities. As of 31 March 2006, the total installed capacity in the country was 5340 MW, which is 46% of the total capacity of renewable resources based power generation. There are 7 manufacturers of wind turbine generators in India.
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Rural Electrification Jharkhand, Bihar, Uttar Pradesh, Orissa, Uttranchal, and Madhya Pradesh are some of the states where significant number (more than 10%) of villages are yet to be electrified.  Number of Villages (1991 Census) - 593,732  Villages Electrified (30 May 2006) - 488,173  Village level Electrification % - 82.2% Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY) Ministry of Power (Government of India) has launched nation-wide scheme for development of rural and household electrification in 2005 towards the National Common Minimum Programme goal of providing access to electricity to all. REC Ltd is the nodal agency for the mega-scheme. Under the scheme, 90% capital subsidy is provided by Government of India for overall cost of projects. Cumulatively till FY10, works in 190,858 villages have been completed and free connections to over 10 million below poverty line (BPL) households have been released.

Renewable Energy
Renewable energy in India is a sector that is still undeveloped. India was the first country in the world to set up a ministry of non-conventional energy resources, in early 1980s. However its success has been very spotty. In recent years India has been lagging behind other nations in the use of renewable energy (RE). The share of RE in the energy sector is less than 8% of India's total energy needs. Renewable energy in India comes under the purview of the Ministry of New and Renewable Energy.

IMPACT OF POWER SECTOR

LOCAL IMPACTS Large power sources can affect their surroundings through impacts such as air pollution, submergence of land and waste accumulation, excessive resource use and disruption of human activity. The impacts of coal-based thermal plants are particularly important in a study of India, as these plants currently provide the largest generating capacity in India, and about 80% of the actual generation. Electricity generation consumed 67% of Indias coal use, in 2002; further, Indias coal consumption is projected to grow 2.2% annually between 2002 and 2025 (EIA, 2005). Most of the existing thermal power plants in India use the traditional pulverized coal combustion technology. As a result, they have to contend with gaseous emissions including carbon dioxide, nitrogen oxides, carbon monoxide, sulphur dioxide, mercury and particulate matter. Coal-burning thermal power plants in India are responsible for about 40% of the countrys SO2 and 41% of its CO2 in 2000 (Shukla, Nag, & Biswas, 2003). Coal-plant emissions far outweigh those from other fossil-fuel plants contributing to acid rain, and air pollution and the consequent adverse effects on health. When based on locally mined coal, the associated problems of mining accidents and land degradation are serious. In some areas, the use of high ash coal results in disposal problems, although ash does have productive uses such as brick-making. However, with the alternative fossil-fuel options, oil-and gas-based plants, too, issues of waste disposal and possible drilling and pipeline accidents have to be considered. The water use by some thermal plants constitutes a more serious problem; Indian thermal power plants reportedly use 88% of the countrys industrial water supply (DTE, 2003). Temperature increases and pollution of receiving water bodies through inadequately treated effluents have also to be dealt with. Although based on a clean and renewable source, large hydroelectric plants are not impact-free. Large dams can cause submergence of human settlements and natural

forests, adversely affecting or even destroying peoples livelihoods, particularly traditional lifestyles, and also terrestrial ecosystems. However, the magnitude of these impacts varies with the location and the height of the dams constructed. With nuclear power plants, radiation hazards (not only through accidents), and disposal of radioactive spent fuel must also be contended with. Thus far, no country is sure of safe and permanent waste disposal. And, while clean in terms of carbon emissions, both ends of the nuclear fuel cycle uranium mining and nuclear waste have harmful environmental impacts, if not very carefully managed. However, environmental impact costs are not easily quantifiable. Pollution-induced health impacts are underestimated when economically disadvantaged people do not obtain medical treatment; similarly, disruption costs of displaced communities could be inestimable. REGIONAL IMPACTS Regional pollution issues, for example the issue of acid rain and sulphur deposition, have received attention in Northeast Asia. While the magnitude of coal-fired power plants' contribution may be disputed, particularly during winter and spring, when dominant high-pressure systems sweep accumulated pollutants off the landmass toward the eastern ocean-mass. To study and analyze the power sector better, the comparative and analytical study of the Top 5 listed firms of power sector in India is done. The firms are chosen based on their sales turnover. The below are the firms selected by us for the study, TOP 5 COMPANIES OF POWER SECTOR  NTPC  Energy Develop  Tata Power  Power Grid
 Torrent 

1. NTPC Ltd.
NTPC Limited is the largest power generating and Navratna status company of India; it was incorporated in the year 1975 as National Thermal Power Corporation Private Limited to accelerate power development in the country. As a wholly owned company of the Government of India, NTPC has emerged as a truly national power company, with power generating facilities in all the major regions of the country. NTPC's core business is engineering, construction and operation of power generating plants. NTPC as an integrated Power Major with presence in Hydro Power, Coal mining, Oil & Gas exploration, Power Distribution & Trading and also enter into Nuclear Power Development. It provides consultancy also in the area of power plant constructions and power generation to companies in India and abroad. It is providing power at the cheapest average tariff in the country. With its experience and expertise in the power sector, also NTPC is extending consultancy services to various organisations in the power business. The consulting Wing of NTPC is an ISO 9001:2000 accreditation. In the year of 1982, the company commissioned the first Singrauli unit. During the year 2002, the company incorporated three wholly owned subsidiary of the company viz. NTPC Electric Supply Company Limited, NTPC Hydro Limited and NTPC Vidyut Nigam Limited. Golden Peacock Award conferred to the company for Corporate Social Responsibility in14th November of the year 2003. Unit IV (500 MW) of Talcher Super Thermal Power Project -Stage II (TSTPP-II) of THE COMPANY has been successfully synchronized on 6th February 2005. The 500 MW Unit at Ramagundam Super Thermal Power Station has commenced commercial operation on 25th March 2005. In May of the year 2005, NTPC and Defence Metallurgical Research Laboratory (DMRL) have signed an MOU. NTPC has bagged IPMA International Project Management Award 2005 for its Simhadri Thermal Power project on 15th November 2005. NTPC established the medium Term Note ('MTN') Programme in February of the year 2006 to facilitate the raising of funds on a regular basis from the international debt capital markets and also signed an MOU with Delhi Transco Ltd., (DTL) on 10th February 2006 for expansion of one of its stations namely National Capital Power Station Stage-II at Dadri (U. P.). During the March of the year 2006, NTPC Ltd has entered into a Memorandum of Understanding with Petronet LNG Limited for

arranging one MMTPA of LNG, which used to overcome shortage of gas at the existing gas power stations of NTPC. The Company had taken over the Badarpur Thermal Power Station with the capacity of 705MW in the year 2006 from Central Electricity Authority. The Company had signed a Memorandum of Understanding in 11th March of the year 2006 with the Energy and Resources Institute (TERI) for implementation of distributed generation projects in villages in India. A 500 MW unit of Vindhyachal Super Thermal Power Project -Stage III of NTPC Limited located in the state of Madhya Pradesh has been successfully synchronized on 27th July 2006. NTPC Limited and Singareni Collieries Company Limited have signed a Memorandum of Understanding during August of the year 2006, for creation of a Joint Venture Company to undertake various activities in coal and power sectors including acquisition of coalmines, development and operation of integrated coal based plants and providing consultancy services. The Company has signed a Memorandum of Agreement (MOA) in September 21st of the year 2006 with the Government of Arunachal Pradesh for implementation of the following two hydroelectric power projects in the States of Arunachal Pradesh. NTPC had formed a joint venture Company under the name and style of 'Aravali Power Company Pvt Ltd' on December 21, 2006 with Haryana Power Generation Corporation Ltd (A Government of Haryana Undertaking). The Company has signed a MoU in February 14th of the year 2007 with Bharat Earth Movers Limited (BEML) for collaborating and associating with NTPC for a long-term mutually beneficial business. A 500 MW unit of Vindhyachal Super Thermal Power Project, Stage III of NTPC Limited located in the state of Madhya Pradesh has been successfully (test) synchronized in the night of 8th March 2007. Signed a Memorandum of Understanding with Coal India Limited on 15.03.2007 for undertaking development, operation & maintenance of coal blocks and integrated coal based power plants. NTPC signed an agreement for a term loan of USD 100 million with KFW of Germany on March 23, 2007 at Frankfurt am Main.

During the year 2007-08, the MOU was signed with ADB for establishment of power generation capacity of about 500 MW through Renewable Energy Sources. The JVA was signed between NTPC and BSEB for setting up 3x660 MW at Nabinagar, Bihar and also another one JVA was signed with UPRVUNL to set-up 2x660 MW power

project at Meja Tehsil in Allahabad, UP. The Joint Venture Company (Subsidiary of NTPC) under the name of 'Bhartiya Rail Bijlee Company Limited' incorporated with Railways for setting up 1000 MW coal based power plant at Nabinagar, Bihar. Business Collaboration and Share Holder's Agreement signed with Govt. of Kerala and TELK to acquire around 44.6% stake of TELK. The MOU was signed with Bharat Forge Limited for setting up a new facility to take up manufacture of Balance of Plant equipments, castings, forgings, fittings etc. JVA signed with BHEL for taking up activities related to carrying out EPC and manufacturing of equipments in the period of 2007-08. The 500 MW Unit-I at Sipat Super Thermal Power Project, StageII has commenced commercial operation in June of the year 2008. NTPC has signed a Memorandum of Understanding (MOU) with Secretary (Power), Government of India for generating 2.09 billion units of Electricity during the financial year 2008-09.

Developing and operating world-class power stations is NTPC's core competence. Its scale of operation, financial strength and large experience serve to provide an advantage over competitors. To meet the objective of making available reliable and quality power at competitive prices, NTPC would continue to speedily implement projects and introduce state-of-art technologies.

The growth of the capacity of NTPC

2. RELIANCE INFRASTRUCTURE LTD

Reliance Energy Limited (REL), with its corporate lineage going back to 1929. At the time of incorporation REL was called as Bombay Suburban Electric Supply Limited (BSES). The company has been in the field of power distribution for nearly eight decades and with its emphasis on continuous improvements. REL is a fully integrated utility engaged in the generation, transmission and distribution of electricity. It ranks among India's top listed private companies on all major financial parameters, including assets, sales, profits and market capitalization. A key constituent of the Reliance -Anil Dhirubhai Ambani Group, India's third largest business house. Reliance Energy has emerged as one of the leading players in India in the Engineering, Procurement and Construction (EPC) segment of the power sector. Reliance Energy company currently pursue several gas, coal, wind and hydro-based power generation projects in Maharashtra, Uttar Pradesh, Arunachal Pradesh and Uttaranchal with aggregate capacity of over 13,510 MW. Reliance Energy is also active in the trading and transmission of power sector and has forayed as an equity investor in to the infrastructure business, including in the prestigious Mumbai metro rail project and various road projects of the National Highways Authority of India. REL has also entered into the Internet service provider business in a big way by the name of powersurfer.net. REL (BSES) has several group companies -ST-BSES Coal Washery (Joint Venture), BSES Infrastructure Finance, Utility Powertech (Joint Venture), Ticapco, BSES Telecom, BSES Kerala Power, BSES Andhra Power and three new companies of Orissa. The company has a strategy of adding value by strategic alliances within the group. In March 2000 company has been operated "BSES Telecom" as an Internet service provider (ISP) in Mumbai and has a fiber optic network to support its last mile services and also exploring alliances for providing utility solutions. Dahanu Power Station achieved a plant load factor (PLF) of 82.68% during 2000-01. In 2001-02, the BSES Kerala Power Ltd had commissioned the power station in the Combined Cycle mode but due to various reasons the BKPL has suspended its operations from October, 2001. OFGW of 220 KW transmission line between Ghodbunder, Versova and Dahanu was successfully completed. RE L's Wind Energy has one of the highest PLF in the country in the wind farm segment. Contracts and EPC Division was

instrumental in construction and erection works of 5,000 mw in Indian and other industrial and infrastructure projects. BSES Infrastructure Finance has tied up funds for various projects to the tune of over Rs 1,500 crore. Utility Powertech is a JV with National Thermal Power Corporation (NTPC) has 250 operational sites. During the year 2002-2003, the company has successfully commissioned 210 MW Gas Based Combined Cycle power plants for BSES Andhra Power and 24 MW Bagasse fired Power Plant for Godavari Sugar Mills Ltd and 20 MW for Suryachakra Power Corporation Ltd. In April 2003 Andhra Power Ltd and Reliance Salgocar Power Company Ltd were amalgamated with the company. During the year 20032004, the Company was renamed to Reliance Energy Ltd from its old name BSES. Reliance energy continues to receive prestigious awards and recognitions for its outstanding performance in various fields and through various sources. The Dahanu Power Station received the National Award for Excellence in Energy Management and National Award for Excellence in Water Management from the Confederation of Indian Industry and also company got the Maharashtra safety award-2004 from the Maharashtra Chapter of National Safety Council. Gold Shield for Meritorious Performance by the Central Electricity Authority (CEA) of the Government of India for its excellent performance amongst Indian thermal power plants in the year 2004-05, which was presented by the Honorable Prime Minister of India. The power station also obtained OSHAS 18001 certification from BVQI during the year of 2005-06. During the year 2006-07, Reliance Energy had received many awards such as Golden Peacock Award for its pursuit of excellence in corporate governance, International Quality Crown Award London 2006 in Gold category, Srishti Good Green Governance (G-Cube) Award and participated in the prestigious Ramakrishna Bajaj National Quality Awards, the company was awarded a commendation certificate for the same. In April 2007 REL planned to set up a 1,400 Mw gas-based power project in Delhi and also company has estimated that it would have to invest Rs 60,000 crore in next five years to add a capacity of 15,000 MW of power. As on September 2007 REL considered to hive off its engineering, procurement and construction (EPC) division into a new company.

Reliance Energy distribute more than 28 billion units of electricity to cover 25 million consumers across different parts of the country including Mumbai and Delhi in an area that spans over 1,24,300 sq. kms. It generates 941 MW of electricity, through its power stations located in Maharashtra, Andhra Pradesh, Kerala, Karnataka and Goa. These projects are at various stages of development. Company wants to attain global best practices and become a world-class utility and to provide uninterrupted, affordable, quality, reliable and clean power to millions of customers. Future plan and action of the company is installation of third cooling tower cell to improve plant reliability and output. Energy savings by installation of energy efficient blades on cooling tower fans. ETP pump modification to reduce auxiliary power consumption. Auto -locking facility of energy meters at midnight to facilitate simultaneous logging of energy meter readings. The company has targeted to complete all activities under the six sigma project, ISO 27001 and OHSAS certifications during 2007-08, which will make Reliance Energy the first utility in the country to achieve these certifications. These initiatives are aimed to cater the market and at further promoting business excellence in all functional areas of the company. In 2008 company engaged in several mega projects under implementation and under consideration in different functional areas, in that the notable two big projects are engineering, procurement and construction (EPC) contract from Damodar Valley Corporation (DVC) to set up the 2 x 600 MW coal based power station at Raghunathpur in West Bengal worth of Rs 3,725 crore and Airport Metro Express Line, Delhi project on BOOT basis for a concession period of 30 years worth of Rs 2,500 crore.

Production Capacity : 941 MW



3. TATA POWER COMPANY LTD

Tata Power Company Limited (TPC), India's largest integrated Electric Power Utility in private sector with a reputation for reliability, incorporated in the year 1919 at Mumbai. TPC pioneered the generation of electricity in India nine decades ago. The core business of Tata Power Company is to generate, transmit and distribute electricity. The Company operates in two business segments: Power and Other. The Power segment is engaged in generation, transmission and distribution of electricity. The other segment deals with electronic equipment, project consultancy. The Tata-Ebasco Consulting Engineering Services' was established based on partnership with Ebasco India, Ltd for consulting engineering together with its two associated companies in the year 1961. In the year 1969, a new company under the name Chemical Terminal Trombay Ltd was formed in participation with other Tata Companies and Elephanta India Private Ltd to installation of storage tanks on a part of the Company's ash disposal area at Trombay and the laying of a pipeline connecting the storage tanks with the Mumbai Port Trust's pier at Pir Pau. TPC sets up its new manufacturing facility at Bangalore during the year 1980, for commercial production of electronic items designed by its R&D laboratory. TPC has undertaken a 180 MW combined cycle plant at Trombay using gas turbines. In 1989, six new outlets for BEST at 33 KV from Carnac receiving stations were commissioned during the year. In the same year the company also associated with Siemens in the erection and commissioned the mechanical and electrical equipment for the 4 x 130 MW gas turbines and 2 x 150 MW steam turbines at NTPC's combined cycle power plant at Dadri in Uttar Pradesh. The second 500 MW units 6 at Trombay was trial synchronized with the grid on 23rd March 1990. The Company took up two major generation projects, viz., 150MW Pumped Storage Unit at Bhira and a gas-based 180 MW Combined Cycle Plant at Trombay Thermal Power Station in case of a major system disturbance and supply power to essential consumers, viz., Railways, BMC, BARC, etc. TPC started one new 110 KV substation at Versova during 1991, which comprised 2 x 90 MVA, 110/33 KV power transformers along with 33 KV indoor SF6switchgear and supervisory control and data acquisition system and also another one switching station was established in the same year, which

comprised 3 x 250 MVA, 220/110/33 KV autotransformers, space saving 245 KV gas insulated switchgear and supervisory control and data acquisition system. The modern 22 KV indoor SF6switchgear was installed at Salsette and also the 60 MVAR new capacitor banks were installed during the year 1992 at Versova and Malad. Apart from these, replacement of 110 KV oil circuit breakers by modern SF6 breakers at Kalyan, Ambernath, Vikhroli and Salsette receiving stations and extension of fibre optic communication network were also carried out during the same year. In 1994, the Trombay Unit-7 steam turbine generator of the company was harmonized, which generated 650 MUS with PLF of 61.9%. During the year, the Company undertook the work of strengthening dams as per designs codes in respect of earthquakes. The Government of Maharashtra had accorded its permission for rebuilding a dam at Somwadi. A MoU was signed between TEC and the Tennesse Valley Authority of USA for renovation and modernisation of power plants. In the same year 1994, the Company issued 91,549 Global Depository Shares. The 150 MW Pumped storage unit was commissioned in the year 1995, based on the synchronous condenser mode and also the Company undertook the work of modernisation and renovation of old 12 MW hydro units at Bhivpuri and Khopoli Generating Stations. In the year 1996, the generating station five 25 MW units were refurbished by installation of new modern turbine runners of higher efficiency at Bhira. During same the year, the Company bagged the Multi-fuel based 80 MW power project from the Government of Karnataka. The thermal Units at Trombay operated by the company in the year 1997 based on-line availability of about 74% and utilization of about 64.3%. TPC entered into a Joint Venture Agreement with Total Gas and Power India in the year 1998 for establishment of LNG Terminal at Trombay. During 1999, the company acquired a generating station consisting of 37.5 MW Unit at Wadi, Karnataka and also in the year the Power Purchase Agreement for 81.3 MW Diesel-based Power Plant at Belgaum, Karnataka was signed with Karnataka Electricity Board. Tata Power Company has obtained A' licence as Internet service provider that enables it to operate throughout the country in the year 2000. The Andhra Valley Power Supply Company Ltd and Tata Hydro Electric Supply

Company Ltd were merged with the company in the same year 2000. Tata Power Company Ltd on September of the year 2001, decided to sell its stake consisting of 45 lakh shares in Tata Liebert Ltd (TLL) considering of Rs 170 per share to Emerson Electric (Mauritius) Ltd. The Company signed an agreement with Power Grid Corporation of India Ltd for 'Tala Transmission Line' in the year 2002. The 120 MW Unit 3 at the Jojobera Power Plant of the Company situated in Jamshedpur was commenced its commercial production. TPC has signed the share acquisition agreement with Gvt of National Capital Territory of Delhi to acquire the North NorthWest Delhi Distribution Co. Ltd. (Discom-III), a distribution company belonging to the Delhi Vidyut Board (DVB), which supplies power to north and northwestern Delhi. The company ties up with the UK-based energy major British Petroleum to jointly work on 2,184 mw Dabhol power project during the year 2003. During the same year 2003, TPC awarded the contract for supply and construction of 180 KM long 400 KV Double Circuit Transmission Line from Palandur to Chandrapur (Maharashtra) By Power Grid Corporation of India Ltd. Tata Power infuses Rs 352 crore in the group's telecom businesses. Tata Power acquired 100% equity stake in Tata Power Trading Co. Pvt Ltd in the year 2004. The Christened Tata Power Trading Company was incorporated in the year as a subsidiary of the company. TPC has signed a Development Agreement with GAIL India Ltd & BP to jointly participate in evaluating the Dabhol gas and power opportunity. A MoU was signed with National Power Company of Al-Zamil Group, Kingdom of Saudi Arabia. The company bagged the 2nd Wartsila -Mantosh Sondhi Award for outstanding contribution to the Indian Power Sector in 2004. Tata Power signed a generation pact with DVC on Maithon Project in the year 2005 and entered into an agreement for sale of shares in Tata Power Broadband. The company received CII EXIM Bank Award 2005 for 'Certificate for Strong Commitment to Excel'. During the period of 2006, the company joined hands with Siemens. The company signed a joint venture agreement with Tata Steel to set up a Captive Power plants in Chattisgarh, Orissa and Jharkhand. The company received seven licenses from the Gvt of India, Ministry of Commerce and Industry, Dept of Industrial Policy & Promotion for its Strategic Electronics Division (Tata Power SED). In the year 2007, TPC has signed a MoU with the Government of Chhattisgarh for the

setting up of a 1000 MW coal fired mega power plant in the State. The company has roped in Korea-based Doosan Heavy Industries and Construction Ltd for supercritical boilers for its Mundra ultra mega power project. The acquisition of Coastal Gujarat Power Ltd was med by the company and a Special Purpose Vehicle (SPV) formed for Mundra Ultra Mega Power Project (UMPP). TPC has signed an EPC contract for supply of five (5) 800 MW Steam Turbine Generators with Toshiba Corporation for the first 4000 MW Ultra Mega Power Project (UMPP) in India to be located at Mundra, Gujarat in August 2007. As on February 2008, The Tata Power Company Limited (Tata Power) and Damodar Valley Corporation (DVC) jointly completed its financing for the 1050 MW coal based thermal power project, being set up in Dhanbad District of Jharkhand State. Recognising the steady and stable performance in generating quality and reliable energy, the Central Electricity Authority has awarded Tata Power's Bhira Hydro generation facility with the Silver Shield award for the meritorious performance in March 2008. April of the year 2008, Tata Power completes the Signing of Financial Agreements for 4000 MW Ultra Mega Power Project, coming up at Mundra, Gujarat. The cost of the project is estimated at INR 17000 crores (USD 4.2 billion). Tata Power announced in September of the year 2008, it would acquire a 11.4 per cent stake in Geodynamics Ltd, an Australian company specialising in geothermal energy, for Rs 165 crore. Tata Power is surging ahead, lighting up lives through its activities from its inception. The challenge of fulfilling the ever growing needs of power have been met by Tata Power through efficient generation, transmission, distribution and constant upgradation of its technology in every aspects.

4. POWER GRID CORPORATION OF INDIA LTD

The Company was incorporated in October 23rd of the year 1989 as the National Power Transmission Corporation Limited with the responsibility of planning, executing, owning, operating and maintaining the high voltage transmission systems in the country. Subsequently, the company name was changed to the present name Power Grid Corporation of India Limited (PGCIL) with effect from October 23rd of the year 1992. The company's operational area includes, Development of Inter-State transmission Systems and Grid Management. Development of Inter-State transmission Systems consists of Planning & Design, Construction, Quality Assurance & Inspection and Operation & Maintenance. Grid Management includes Establishment of modern Load Despatch Centres, Real-time Grid Operation, Optimum scheduling & despatch and Energy accounting including settlements. The Diversification consists of Broadband Telecom Services, Sub-transmission, Distribution and Rural Electrification. The company has certified as PAS 99:2006, which integrates the requirements of ISO 9001:2000 for quality, ISO 14001:2004 for environment management and OHSAS 18000:1999 for health and safety management systems. PGCIL has commenced the operations in the year 1992 as part of an initiative of the Government of India to consolidate all the interstate and inter-regional electric power transmission assets of the country in a single entity. In the year 1993 Tehri Hydro Development Corporation Limited's assets were transferred to PGCIL pursuant to a memorandum of understanding executed between the both. Since 1994, the GOI has progressively entrusted the company with the operation of the Regional Load Despatch Centres ('RLDCs') in each of the five regions into which India is divided for purposes of power transmission and regulation. From the year 1995, the consultancy division of the company has provided transmission-related consultancy services to domestic and international projects. In consultancy business, the company has also facilitate the implementation of various GOI-funded projects for the distribution of electricity to end-users, such as the Accelerated Power Development and Reform Programme ('APDRP') in urban and semi-urban areas and the Rajiv Gandhi Grameen Vidhyutikaran Yojana (the 'RGGVY') in rural areas. During the year 1995, the company took over the management of the Eastern Regional Load Despatch Centre and the North Eastern Load Despatch Centre. Again in 1996, the company captured

over the management of the remaining two regional load despatch centres, name ly, the Northern Regional Load Despatch Centre and the Western Load Despatch Centre. In 1998, the Government of India formally notified the PGCIL as a Central Transmission Utility and also in same year PGCIL was declared as a Mini Ratna Category I public sector undertaking by the Government of India. Department of Telecommunications, Government of India has granted the Infrastructure Provider II license (IP II) to the company in the year of 2001, for pursue leasing of bandwidth capacity to various customers on its telecommunications network. During the year 2002, the company commissioned the unified load dispatch and communications schemes for the northern and southern regions. The Sasaram HVDC back to back transmission system developed by the PGCIL was commissioned leading to the completion of the first phase of the construction of the National Grid and also the 2,000 MW Talchar-Kolar bipolar HVDC link was commissioned, which also developed by the company. The Company had entered into a joint venture arrangement with Tata Power Company Limited during the period of 2003 for implementing a part of the entire transmission system associated with Tala Hydro-Electric Project which was the first public-private sector initiative in the transmission sector. PGCIL had developed the 400 KV Raipur-Rourkela line transmission lines and it was commissioned. Also in the same period of 2003, the Western region, Eastern Region and North-Eastern Region begin operating in a synchronised manner with a cumulative capacity of 50,000 MW. The Company secured its first international consultancy contract from Bhutan Telecommunications. The unified load dispatch and communications scheme for the eastern region was commissioned in the year of 2005. After a year, in 2006, the unified load dispatch and communications scheme for the western region was commissioned. In the same year 2006, PGCIL had entered into an agreement with Rural Electrification Corporation Limited and certain state governments and state utilities for undertaking rural electrification works under the Rajiv Gandhi Grameen Vidyutkaran Yojana in nine states. Power Grid Corporation of India Ltd (PGCIL) has been selected for the Government's MoU Excellence Award for the year 2006-07.

PGCIL has signed a loan agreement with Asian Development Bank (ADB), Manila for US$ 400 million on March 28th 2008, as well as in the same date, same month and same year the company has signed a loan agreement with The World Bank for USD 600 Million. As on May 1st of the year 2008, the Government granted coveted 'Navratna' status to Power Grid Corporation of India Ltd, giving the transmission major financial autonomy to take independent decision on investments up to Rs 1,000 crore. The company is looking to tap the potential of its telecom business and consultancy; the electricity towers could be an ideal place to locate the cellular phone transmission towers in the future.


5. TORRENT POWER LTD

Torrent Power Limited (TPL) is an integrated power company engaged in the generation and distribution of electricity in the cities of Ahmedabad, Gandhinagar and Surat in the state of Gujarat and Bhiwandi Franchise in Maharashtra. TPL was incorporated in 29th April of the year 2004 as Torrent Power Trading Private Limited. Torrent brought together three of its group companies during the year 2004-05, Torrent Power AEC Limited, Torrent Power SEC Limited and Torrent Power Generation Limited under a single, unified brand as Torrent Power. Government of India conferred Gold shield for best performance in power distribution for the years 2004-05 and also for 2005-06. TPL and Siemens created a 50:50 JV to provide O&M services to its SUGEN 1147.5 MW CCPP in the year 2005-06. The Company had awarded EPC contract for its SUGEN 1147.5 MW CCPP to a consortium of Siemens AG and Siemens Ltd. India; commenced construction of its first power block. The Company had entered into a Joint Venture with Power Grid Corporation of India Limited (PGCIL) in the same year 2005-06 for setting up dedicated transmission lines of 440 KV for evacuation of power from 1100 MW SUGEN project to Ahmedabad distribution area and to the National Grid through connectivity with PGCIL at Dehgam and Loop In Loop Out of Gandhar-Vapi line. The name of the company was changed to Torrent Power Private Limited in 25th January of the year 2006. Consequent to the conversion of the company into a Public Limited Company in 8th February of the year 2006, the company came to be called as Torrent Power Limited.

As at 20th December 2006, the company had signed a distribution franchise agreement for a period of ten years for the Bhiwandi circle in Maharashtra with Maharashtra State Electricity Distribution Company Limited (MSEDCL). The Company had commenced Distribution Franchise Bhiwandi circle of catering to 1.4 lakh customers with an unrestricted demand of about 700 MW in 26th January of the year 2007. TPL had signed a memorandum of understanding (MoU) with Gujarat Power Corporation in May of the year 2007 for setting up over 1000-MW coal based power project at Pipavav, dist. Amreli in Gujarat. TPL made tie up with Gujarat State Petronet Limited for the gas transportation in line with project requirement. The Company had enhanced power transformation capacity during the year 2007-08 about 371 MVA by commissioned of two 220 kV substations at Surat and one 33 kV substation at Ahmedabad. CRISIL had assigned AA-& P1+ ratings to the company's bank facilities in March of the year 2008.

RATIO ANALYSIS
Financial ratio analysis can reveal much about a company and its operations. However, there are several points to keep in mind about ratios. First, a ratio is a "flag" indicating areas of strength or weakness. One or even several ratios might be misleading, but when combined with other knowledge of a company's management and economic circumstances, financial analysis can tell much about a corporation. Second, there is no single correct value for a ratio. The observation that the value of a particular ratio is too high, too low, or just right depends on the perspective of the analyst and on the company's competitive strategy. Third, financial ratios are meaningful only when compared with some standard, such as an industry trend, ratio trend, a trend for the specific company being analyzed, or a stated management objective.

Key Ratios
1. Debt-to-equity ratio: A debt-to-equity ratio, which is the total debt of an entity divided by the total equity of that entity, is a measure of the use of leverage or a measure of risk. Leverage is the use of other people's money to make money. In its simplest form, it is borrowing money from someone at a stated interest rate (such as 8%) and then investing that money in a project that earns a greater return than this stated rate (such as a 12% return). Leverage results in great profitability--when it works--because an entity is earning profits without having to invest any of its own money to get that return. The greater an entity's debt-to equity ratio, the greater is the use of other people's money to make money. The greater an entity's debt-to-equity ratio, the greater is the opportunity for high returns for that entity. The debt-to-equity ratio is also a measure of risk since the more debt that is used, the greater the risk that the entity might be forced to liquidate and go out of business. 2. Long Term Debt-to-equity Ratio: It is a capitalization ratio comparing long-term debt to shareholders' equity. Its a measure of a company's financial leverage calculated by dividing its total liabilities by stockholders' equity. It indicates what proportion of equity and debt the company is using to finance its assets. Sometimes only interest-bearing, long-term debt is used

instead of total liabilities in the calculation. It is also known as the Personal Debt/Equity Ratio, this ratio can be applied to personal financial statements as well as companies. A high debt/equity ratio generally means that a company has been aggressive in financing its growth with debt. This can result in volatile earnings as a result of the additional interest expense. The debt/equity ratio also depends on the industry in which the company operates. 3. Current Ratio: An indication of a company's ability to meet short-term debt obligations; the higher the ratio, the more liquid the company is. Current ratio is equal to current assets divided by current liabilities. If the current assets of a company are more than twice the current liabilities, then that company is generally considered to have good shortterm financial strength. If current liabilities exceed current assets, then the company may have problems meeting its short-term obligations. 4. Turnover Ratios: i. Interest Cover Ratio: It is a ratio used to determine how easily a company can pay interest on outstanding debt. The interest coverage ratio is calculated by dividing a company's earnings before interest and taxes (EBIT) of one period by the company's interest expenses of the same period. The lower the ratio, the more the company is burdened by debt expense. When a company's interest coverage ratio is 1.5 or lower, its ability to meet interest expenses may be questionable. An interest coverage ratio below 1 indicates the company is not generating sufficient revenues to satisfy interest expenses. ii. Fixed Asset Turnover: A long-term, tangible asset is held for business use and not expected to be converted to cash in the current or upcoming fiscal year, such as manufacturing equipment, real estate, and furniture. A high fixed asset turnover is preferred since it indicates a better efficiency in fixed assets utilization.

iii.

Inventory turnover: Its a ratio showing how many times a company's inventory is sold and replaced over a period. This ratio measures the stock in relation to turnover in order to determine how often the stock turns over in the business. It indicates the efficiency of the firm in selling its product. It is calculated by dividing the cost of goods sold by the average inventory. Inventory represents one of the most important assets that most businesses possess, because the turnover of inventory represents one of the primary sources of revenue generation and subsequent earnings for the company's shareholders/owners. Possessing a high amount of inventory for long periods of time is not usually good for a business because of inventory storage and obsolescence costs. However, possessing too little inventory isn't good either, because the business runs the risk of losing out on potential sales and potential market share as well. The days in the period can then be divided by the inventory turnover formula to calculate the days it takes to sell the inventory on hand or "inventory turnover days".

iv.

Debtors Turnover Ratio: This ratio indicates the relation between net credit sales and average accounts receivables of the years. Its also known as debtors velocity. This ratio indicates the efficiency of the concern to collect the amount due from debtors. It determines the efficiency with which the trade debtors are managed. Higher the ratio, better it is as it proves that the debts are being collected very quickly.

v.

ROCE (Return on Capital Employed): ROCE is used in finance as a measure of the returns that a company is realizing from its capital employed. It is commonly used as a measure for comparing the performance between businesses and for assessing whether a business generates enough returns to pay for its cost of capital.

vi.

RONW (Return on Net Worth): RONW is the ratio of net income after taxes to total net worth at the end of the year. This ratio indicates the return on stockholder's total equity. Also known as Return on equity which measures a corporation's profitability by revealing how much profit a company generates with the money shareholders have invested.

FUNDAMENTAL ANALYSIS
Fundamental analysis is the examination of the underlying forces that affect the well being of the economy, industry groups, and companies. As with most analysis, the goal is to derive a forecast and profit from future price movements. At the company level, fundamental analysis may involve examination of financial data, management, business concept and competition. At the industry level, there might be an examination of supply and demand forces for the products offered. For the national economy, fundamental analysis might focus on economic data to assess the present and future growth of the economy. To forecast future stock prices, fundamental analysis combines economic, industry, and company analysis to derive a stock's current fair value and forecast future value. If fair value is not equal to the current stock price, fundamental analysts believe that the stock is either over or under valued and the market price will ultimately gravitate towards fair value. Fundamentalists do not heed the advice of the random walkers and believe that markets are weak-form efficient. By believing that prices do not accurately reflect all available information, fundamental analysts look to capitalize on perceived price discrepancies. Strengths of Fundamental Analysis 1. Long-term Trends Fundamental analysis is good for long-term investments based on long-term trends, very long-term. The ability to identify and predict long-term economic, demographic, technological or consumer trends can benefit patient investors who pick the right industry groups or companies. 2. Value Spotting Sound fundamental analysis will help identify companies that represent a good value. Some of the most legendary investors think long-term and value. Graham and Dodd, Warren Buffett and John Neff are seen as the champions of value investing. Fundamental analysis can help uncover companies with valuable assets, a strong balance sheet, stable earnings, and staying power.

3. Business Acumen One of the most obvious, but less tangible, rewards of fundamental analysis is the development of a thorough understanding of the business. After such painstaking research and analysis, an investor will be familiar with the key revenue and profit drivers behind a company. Earnings and earnings expectations can be potent drivers of equity prices. Even some technicians will agree to that. A good understanding can help investors avoid companies that are prone to shortfalls and identify those that continue to deliver. In addition to understanding the business, fundamental analysis allows investors to develop an understanding of the key value drivers and companies within an industry. A stock's price is heavily influenced by its industry group. By studying these groups, investors can better position themselves to identify opportunities that are high-risk (tech), low-risk (utilities), growth oriented (computer), value driven (oil), non-cyclical (consumer staples), cyclical (transportation) or income-oriented (high yield). 4. Knowing Who's Who Stocks move as a group. By understanding a company's business, investors can better position themselves to categorize stocks within their relevant industry group. Business can change rapidly and with it the revenue mix of a company. This happened too many of the pure Internet retailers, which were not really Internet companies, but plain retailers. Knowing a company's business and being able to place it in a group can make a huge difference in relative valuations.

Weaknesses of Fundamental Analysis

1. Time Constraints Fundamental analysis may offer excellent insights, but it can be extraordinarily time-consuming. Time-consuming models often produce valuations that are contradictory to the current price prevailing on Wall Street. When this happens, the analyst basically claims that the whole street has got it wrong. This is not to say that there are not misunderstood companies out there, but it is quite brash to imply that the market price, and hence Wall Street, is wrong.

2. Industry/Company Specific Valuation techniques vary depending on the industry group and specifics of each company. For this reason, a different technique and model is required for different industries and different companies. This can get quite time-consuming, which can limit the amount of research that can be performed. A subscription-based model may work great for an Internet Service Provider (ISP), but is not likely to be the best model to value an oil company.

PORTFOLIO MANAGEMENT
Portfolio theory is an investment approach developed by University of Chicago economist Harry M. Markowitz (1927 - ), who won a Nobel Prize in economics in 1990. Portfolio theory allows investors to estimate both the expected risks and returns, as measured statistically, for their investment portfolios. Markowitz described how to combine assets into efficiently diversified portfolios. It was his position that a portfolio's risk could be reduced and the expected rate of return could be improved if investments having dissimilar price movements were combined. In other words, Markowitz explained how to best assemble a diversified portfolio and proved that such a portfolio would likely do well.

PORTFOLIO STRATEGY
There are two types of Portfolio Strategies: A. Passive Portfolio Strategy: It is a strategy that involves minimal expectational input, and relies on diversification to match the performance of some market index. A passive strategy assumes that the marketplace will reflect all available information in the price paid for securities. B. Active Portfolio Strategy: It is a strategy that uses available information and forecasting techniques to seek a better performance than a portfolio that is simply diversified broadly.

Moreover, there are three more types of Portfolios: 1. The Patient Portfolio: This type invests in well-known stocks. Most pay dividends and are candidates to buy and hold for long periods. The vast majority of the stocks in this portfolio represent classic growth companies, those that can be expected to deliver higher earnings on a regular basis regardless of economic conditions. 2. The Aggressive Portfolio: This portfolio invests in "expensive stocks" (in terms of such measurements as price-earnings ratios) that offer big rewards but also carry big risks. This portfolio "collects" stocks of rapidly growing companies of all sizes, that over the next few years are expected to deliver rapid annual earnings growth. Because many of these stocks are on the less-established side, this portfolio is the likeliest to experience big turnovers over time, as winners and losers become apparent. 3. The Conservative Portfolio: They choose stocks with an eye on yield, as well as earnings growth and a steady dividend history.