REG - OPG Power Ventures - Trading Update

OPG Power VenturesAnnouncement

21/03/2025 07:00

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RNS Number : 5611B  OPG Power Ventures plc  21 March 2025

21 March 2025

 

 

OPG Power Ventures Plc

("OPG", the "Group" or the "Company")

 

Trading Update

 

OPG Power Ventures plc (AIM: OPG), provides the following trading update for
the year ending 31 March ("FY25"):

 

General Business Update

 

During FY25 to date, the Company has achieved PLF of 69.6% compared with 69.7%
in FY24 and 69.2% during FY23. Subject to audit, the Company expects to report
FY25 EBITDA, in line with market expectations.

 

Empowering India - Macro Outlook

 

India is set to dominate the global economic landscape, maintaining its status
as the fastest-growing economy for the next decade, with the World Bank
projecting a steady 6.7% growth in FY26 and FY27, significantly outpacing
global growth, which is expected to remain at 2.7% in FY26.

 

India's per capital power consumption has been low at approximately 1380kwh
compared to approximately 6630kwh in China. During FY17-24, India's overall
power requirement reached a 5% CAGR to 1,734 billion units (BU) with peak
power demand also seeing a similar growth rate. In the FY21-23 period post
Covid-19, power demand in India witnessed approximately 8% CAGR. Key factors
driving strong power demand include rising population, urbanisation, low per
capita consumption and an increase in economic activities.

 

The convergence of economic growth, increased electrification and technology
as demand drivers are expected to increase power demand in India at 7 - 7.5%
CAGR over the next 10 years leading to an investment opportunity of
approximately USD 0.5 trillion, with electric vehicles and data centres
expected to drive one third of the power demand growth.

 

The significant investment opportunity in the Indian power sector is based on
the country's vision to increase its installed power capacity to 900GW from
442GW in FY24, with a mix of thermal, wind, hydro, nuclear and other sources.

 

Regulatory Support

 

The strong turnaround in the financial health and outlook of the power sector
would not have been possible without pro-active policymaking from the
Government of India (GOI). GOI has undertaken a several steps in the last few
years to turn around the operational and financial health of the sector. The
implementation of the late payment surcharge (LPS) has helped reduce
outstanding dues of utilities from INR 1,397 bn as at June 2022 to INR 500 bn
as at January 2024. One of the key priorities of the GOI has been the
reduction of India's transmission losses, which decreased from 22% in FY21 to
15% in FY23.  The GOI has also provided funding support in areas such as
distribution infrastructure, payment support to generating companies and
subsidised financing to distribution companies to strengthen the electricity
sector.

 

Coal Market

 

GOI has focused on increasing the domestic production of coal to reduce import
dependency and accordingly the coal production in India has grown
approximately 12%, increasing from 893 million tonnes in 2022-23 to
approximately 1 billion tonnes in FY24.

 

The international average coal price index appears to have stabilised compared
to post COVID highs. To ensure fuel security, the Group has contracted for
supply of coal  during FY26 from Indonesia (up to 450,000 MT).

 

Debt Reduction

 

In line with the deleveraging strategy of the Group, the Company has repaid
the term debt (including debentures) of £17.5m during FY25.  Accordingly,
gross debt reduced from £28.6m as at 31 March 2024 to £11.1m as at 31
December 2024. Net cash as at 31 December 2024 was £12.6m versus £3.6m as at
31 March 2024.

 

Directorate Change

 

A P Singh, has stepped down from his current role as Chief Financial Officer
and become a non-executive director of the Group for personal reasons. The
Company will commence the process of appointing a new Chief Financial Officer
and will make further announcements in due course.

 

Memorandum of Understanding

 

To drive sustainable growth, the Group is evaluating and assessing various
investment opportunities in the energy sector with various State Governments
within India and has signed Memorandum of Understanding with Government of
Madhya Pradesh and Government of Karnataka.

 

Department of Enforcement Investigation

 

Further to the announcement on 15 November 2024, the Company has continued to
co-operate with and provide all the information requested in relation to the
investigation into alleged regulatory non-compliance by the Group under the
Foreign Exchange Management Act ("FEMA").

 

 

 

For further information, please visit www.opgpower.com or contact:

 

 OPG Power Ventures PLC                                              Via Tavistock below
 A P Singh

 Cavendish Capital Markets Limited (Nominated Adviser & Broker)      +44 (0) 20 7220 0500
 Stephen Keys/Katy Birkin/George Lawson

 Tavistock (Financial PR)                                            +44 (0) 20 7920 3150
 Simon Hudson / Nick Elwes

 

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