Few utilities seen benefiting from decade-high power generation growth

Indian power utilities have had the best summer in at least a decade. Thermal or coal based electricity generation grew 13% in April-June, the best fiscal first quarter growth the sector saw in at least 10 years. The strong growth reflects demand recovery, aided by a favourable base and improvement in power supply position.

But strong generation growth will not lift earnings of all power utilities in the June quarter. That’s because there are few listed pure generation power utilities and several of them continue to face legacy issues, such as regulatory disputes and problems with non-core investments.

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