Most listed power generation companies in the private sector posted moderate profit growth in July-December 2021, riding on higher income from subsidiaries and reduced corporate tax rate.
Out of the 23 companies listed in the 'fuel & power' sector on the Dhaka Stock Exchange (DSE), nine are engaged in power generation owned by private sector people.
Of them, five booked modest profit growth, three dropped slightly while one fell for July-December 2021 compared to the same period a year earlier, according to statistics with the DSE.
The increased revenue earnings from their subsidiaries and corporate tax rate cut continued to help major power generation companies to make good profits, market insiders said.
Fuel & power is the most lucrative sector in the stock market as the companies in the sector are performing better and the government is relying more on private sector companies for power generation, according to a merchant banker.
The earnings per share (EPS) of United Power Generations & Distributions Company, Doreen Power Generation & Systems, Baraka Power, Energypac Power Generation and Shahjibazar Power increased during the period under review.
The consolidated EPS of Summit Power, GBB Power, Baraka Patenga Power dropped marginally while Khulna Power Company fell.
EPS is the portion of a company's profit allocated to each outstanding share of common stock. In short, it serves as an indicator of a company's profitability.
Of the companies, consolidated EPS of Doreen Power rose by 26.23 per cent to Tk 4.86 for July-December 2021, from Tk 3.85 for the same period a year earlier.
The company has attributed the EPS rise to significant increase in revenue of two subsidiaries and significant decrease in finance cost of the group for reduction of outstanding loan and interest rate.
United Power's consolidated EPS jumped 24.63 per cent to Tk 11.84 for July-December 2021, as against Tk 9.50 for July-December 2020.
Company officials said earnings have increased due to significant increase in revenue from the subsidiaries.
United Power's consolidated revenue rose to Tk 20.79 billion in the July-December 2021, up 28.49 per cent, from Tk 16.18 billion in the same period a year ago.
Baraka Power's consolidated EPS rose by 12.67 per cent to Tk 1.69 in July-December 2021 riding on higher-income from associate companies at the end of the period.
Energypac Power has posted a 10.86 per cent increase in its EPS to Tk 1.02 for July-December 2021, as against Tk 0.92 in the same period a year earlier.
Shahjibazar Power's consolidated EPS also increased by 9.93 per cent to Tk 3.32 for the July-December 2021, compared to the same period last year.
Summit Power's EPS dropped by 28.12 per cent to Tk 2.02 for July-December 2021, as operation of Madanganj Power Plant (Unit 1), a 102-MW HFO-fired power plant showdown due to expiry of power purchase agreement (PPA).
However, the extension process of PPA of the said plant is ongoing, said the company.
GBB Power's EPS also fell by 22.08 per cent year-on-year to Tk 0.60 in July-December 2021, as cost of goods sold increased significantly due to completion of major overhauling and alternator rotor rewinding works, said the company.
Another power company of the Baraka Group, Baraka Patenga Power's consolidated EPS dropped by 5.58 per cent to Tk 1.86 for July-December, 2021.
Khulna Power incurred a loss of Tk 0.18 per share in July-December 2021 against profit of Tk 1.57 per share in the same period last year as its two power plants --KPC 40MW Noapara Plant and KPC Unit II 115 MW plant shut down as power purchase agreement (PPA) expired.
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