After prolonged delay, the West Bengal State Electricity Regulatory Commission (WBSERC) today allowed the RP-Sanjiv Goenka Group flagship, CESC Ltd, to enhance electricity tariff in Kolkata by 69 paise unit (over 13 per cent) to Rs 5.88 a unit for 2011-12.
The award came against a petition by the company seeking tariff escalation by Re 1 a unit from the existing Rs 5.19 a unit.
Rough estimates suggest that the awarded tariff will boost the company's bottomline by approximately Rs 550 crore on an annualised basis.
However, in reality, the gains will be spread over a longer period as CESC is asked to collect arrears for the last 10 months in 48 instalments.
Delayed order
The tariff order was delayed, reportedly due to delay on the part of the State utilities to submit petition in the face of stiff opposition from Ms Mamata Banerjee-led State Government.
Though it did not submit any petition to recover cost push during the fiscal, the state-controlled power utilities was recently allowed by the State Government to charge fuel-surcharge.
Meanwhile, inadequate cost recovery led to squeezed CESC's margins substantially in the previous quarters during the fiscal.
Fall in net profit
The company reported approximately 33 per cent fall in net profit to Rs 74 crore during the third quarter of this fiscal ending on December 31, against the corresponding period of the previous year.
Sequentially, the profit is down by 35 per cent from Rs 114 crore during July-September last year.