Managing cash is a challenge in the times of pandemic, and Tata Power Delhi Distribution Ltd has been taking an array of steps to manage the cash flow situation better and avoid any default on its payment obligations, said its CFO Hemant Goyal.
Tata Power Delhi Discom, which supplies power in the capital city to more than 1/3rd consumers and does a business of Rs 650 crore per month, was caught on the wrong foot as were other businesses on account of specifically two reasons.
First, power demand plunged by about 40 percent led by a sharp drop in the industrial and commercial segment during the lockdown period, and second consumers got a respite from the regulator in terms of paying their electricity bills beyond the due date. This meant an equal 40 percent dip in the collections and simply more headache for the CFO Hemant Goyal. So, how did he manage finances? What did he turn to? And when the economy won’t recover anytime soon, what all tools he has in his armory to survive through the pandemic? ETCFO spoke with him to know his travails, and how he specifically dealt with them. Below are the edited excerpts from the interaction.
Q: How much power demand is back compared to the pre-covid19 levels?
Hemant Goyal: Aggregate power demand in terms of value has come back to almost 70-75 percent of the pre-covid19 levels as the economy has started to open up. During the early phases of lockdown, the aggregate power demand had fallen sharply by 40 percent with drop-in 50 percent demand in the industrial and commercial segment followed by 25 percent in the retail category. (Retail and industrial each constitute 45:55 percent demand).
Source of News – cfo.economictimes.indiatimes.com