PowerGrid for good capex

PowerGrid posted 32 per cent higher net profits, earnings growth during the fourth quarter with healthy operating margins. The outlook for the company remains positive with its ongoing capex and strong domestic demand for power transmission services. Last quarter, the company reported a flat revenue at Rs 2,210 crore. The spurt in other income, coupled with a 710 basis points improvement in operating margins to 84.4 per cent, boosted the net profit to Rs 2,696.89 crore for FY2011.
The power ministry needs private participation to address the huge transmission requirement in the country. PowerGrid, which had aimed to invest Rs 54,500 crore during the 2007-12 period, plans another Rs 90,000 crore during the next Five Year Plan. Healthy capex will help the company capture opportunities and quick capitalisation. Commissioning of transmission lines will allow it to improve the return on capital employed.