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Surpassing its already strong performance in the preceding few quarters, Power Grid Corporation of India (Power Grid) posted 31 per cent growth (year-on-year) in revenue to ₹6,120 crore in the June 2016 quarter. This was despite the relatively lower capitalisation of transmission projects worth ₹2,462 during the period. The company has delivered better on this front in the past. Significant project capitalisation in the latter half of the last fiscal, however, bumped up revenue in the latest June quarter.
This translated into an equally impressive 31 per cent jump in operating profit. Impacted by higher depreciation and interest expense, net profit rose to ₹1,802 crore, up 33 per cent from the year-ago period.
The sharp pick-up in project completion in July bodes well for the company.
Power Grid earns an assured return on its commissioned projects. Timely project completion and commissioning, therefore, hold the key to its revenue and earnings growth.
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