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Only Khulna Power’s profit dropped between October and December
All but one power generation company posted a profit in the quarter ending December, in a further sign that the economy has roared back to pre-pandemic levels.
The power companies’ top line had taken a hit for the global coronavirus pandemic, which put the brakes on economic activities.
With the view to containing the spread of the lethal pathogen, the government put the country on a two-and-half-month-long shutdown. Most of the factories were not running then, meaning the demand for power plummeted.
The shutdown was lifted on May 30 last year but the businesses and industries did not immediately spring back to action due to subdued demand.
But the return to profitability of six of the seven listed companies suggests the economy has witnessed a revival in those months.
Only Khulna Power’s profit dropped between October and December: by 22.6 per cent to Tk 26.2 crore.
Doreen Power Generation posted the highest profit growth: 119 per cent to Tk 33.2 crore.
Earnings have increased significantly due to the significant increase in revenue of the two subsidiaries, said Masudur Rahman Bhuiya, company secretary of Doreen Power.
A significant decrease in finance costs for reduction of the outstanding loan and the lower interest rates also helped boost the bottom line, he added.
United Power saw its profit grow 73.2 per cent year-on-year to Tk 561.3 crore in the second quarter of its 2020-21 financial year, which runs from July to June.
The company has acquired 99 per cent shares of the 300MW United Anwara Power and the 115MW United Jamalpur Power from July.
The jump in profit is due to the inclusion of the two plants’ earnings, said Moinuddin Hasan Rashid, managing director of United Power.
On the other hand, the interest rate on bank loans has come down, Rashid said.
From April last year, the interest rate on bank loans came down to 9 per cent, which was a great relief to the power companies that have built their plants with credit from lenders.
Summit Power, the largest private sector power generation company, saw its profit edge up 16.8 per cent to Tk 236.5 crore. In the previous quarter, its profit was down 16.7 per cent year-on-year.
“The higher sales volume was because of the government’s demand,” said Swapon Kumar Pal, company secretary of Summit Power, adding that the costs have come down because of the single-digit interest rates.
Baraka Power saw its profit soar 6.45 per cent to Tk 15.53 crore in the October-December quarter, while Shahjibazar Power’s net profit soared 36.4 per cent to Tk 28.12 crore.
GBB Power saw its profit skyrocket about 88 per cent.
Talking to Dhaka Tribune, market insiders said most of the listed companies’ earnings were healthier this time. The government is relying more on private sector companies for power generation.
(DT)
