December

2015

Update | Sector: Capital Goods

Capital Goods

India Transmission

Ankur Sharma

(Ankurvsharma@MotilalOswal.com); +91 22 3982 5449

Amit Shah

(Amit.Shah@MotilalOswal.com); +91 22 3029 5126

Capital Goods | Transmission

Contents

India Transmission Sector .................................................................................................. 3

Increased government focus on transmisson ..................................................................... 4

Mapping transmission spending over 10 –13 Plan .......................................................... 6

So what does it mean for transmission players? ................................................................ 9

Higher voltage and new technologies the way forward in transmission .......................... 14

Competitive intensity lower post implementation of domestic manufacturing clause..... 16

Tariff-based bidding for transmission projects ................................................................. 20

Planning the transmission system.................................................................................... 24

Annexures........................................................................................................................ 29

Companies .................................................................................................................. 33-63

ABB.............................................................................................................. 34

Alstom T&D India ........................................................................................ 39

Crompton Greaves....................................................................................... 48

KEC International ......................................................................................... 53

Larsen & Toubro .......................................................................................... 58

th

th

Prices as on 16 February 2016

Investors are advised to refer through important disclosures made at the last page of the Research Report.

February 2016

Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.

2

Capital Goods | Transmission

India Transmission

Transmission capex 11th -13th

plan (INR b)

Inter-state

1500

1125

750

375

0

Intra state

India Transmission Sector

States to drive capex

Increased government focus on transmission

The availability of sufficient generation capacity and resolution of fuel supply issues

has driven government’s focus toward reducing transmission constraints and

ensuring seamless power transfer across and within states. India’s current

transformation capacity (220kva and above) stands at 2.3MVA/MW v/s the optimal

~7MVA/MW needed for uninterrupted power evacuation; this highlights the case

for increased investments in the transmission sector.

Transmission capex estimated at INR2.6t (+49%) in the 13

th

Plan (2018-2022e);

states to drive spending

Transmission capex is expected to grow 49% in the 13th Plan to INR2.6t, with inter-

state capex at INR1.3t (+8% v/s 118% in the 12

th

Plan) and the balance as intra-state

capex (+136%). A slowdown in the 13th plan in the inter-state capex (765/400kv) is

on account of a corresponding slowdown in generation capacity addition. Based on

the transmission capacity expected to be rolled out in the 13

th

plan, we estimate a

big jump in spending on intra-state transmission (220kv) and HVDC lines while capex

in the 765kv/400kv segment (transformers, lines, substations) will slow down. We

expect higher competitive intensity in orders at the 220kv level (versus 400/765kv)

as the number of players participating would be higher.

Grid shifts to higher voltages and new technologies; advantage MNC T&D players

The Indian grid (>132kv) has been moving toward higher voltages and new

technologies. Currently, inter-state transmission lines are primarily run at 400/765kv

level. Higher voltages lead to more efficient transfer of power while using lesser

space. Similarly, new technologies such as HVDC, static compensators and PMU’s

are being used to make the grid more stable. MNC T&D players such as Alstom T&D

India, ABB India and Siemens India have an edge over local players as they have

access to their parent’s technology and can introduce these products in India.

Tariff-based bidding - developers prefer players with established track record

With tariff-based bidding the norm for award of projects, developers would prefer

vendors with an established track record to ensure timely completion of the project

and failure free operation over the 35 year time period of the project. However,

aggressive bids could imply pricing pressure for equipment suppliers/EPC players.

Top picks and risks

Within our coverage, our top picks to play the transmission sector capex are Alstom

T&D (Buy, TP: INR470) and KEC International (Buy, TP: INR130). Other stocks with

meaningful exposure to transmission capex are ABB India (Neutral, TP: INR1380),

Crompton Greaves (Neutral, TP: INR165), L&T (Buy, TP: INR1,440) and Siemens India

(Sell, TP: INR1,010). Key risks to our rating are a slower-than-expected pick-up in

state spending and a sharp rise in imports for transmission equipment.

Transmission line addition

(ckm) 11th -13th plan

HVDC

400kv

765kv

220kv

100,000

75,000

50,000

25,000

0

Click here for Video Link

February 2016

3

Capital Goods | Transmission

Increased government focus on transmisson

Transmission constraints and northern region blackout drive spending

Over the past year, Central government’s focus toward transmission has increased

—buoyed by the availability of sufficient generation capacity and resolution of fuel

supply issues, the government’s focus has turned toward reducing transmission

constraints and ensuring seamless power transfer across and within states.

Exhibit 1:

Power Value chain – focus has shifted to transmission and distribution

Source: Ministry of Power, MOSL

India cumulatively added ~110GW in generation capacity over the last eight years.

With a targeted addition of 88GW(excl. renewables) in the 12

th

Plan ending FY17

(likely to be exceeded as 72GW already added till Dec’15), India would add ~145GW

over 10 years—between FY08 and FY17; this compares very favourably to the 8

th

,

9

th,

and 10

th

Five-Year Plans, which saw cumulative addition of a mere 55GW.

While India managed to add significant power generation capacity in the last 10

years, other inputs such as coal, transmission capacity and distribution reforms

failed to keep pace with it. The current government is focusing on:



Strong power generation growth — focus shifts to Transmission &

Distribution



Increasing coal production.

The government intends to increase Coal India’s

production to 1bn tons by FY20; we do note that Coal India’s production grew

by 7% in FY15 and is up 9% YTD,

Resolving transmission and distribution constraints.

The government has

already started focusing on removing transmission bottlenecks and the recent

UDAY scheme should hopefully lead to a turnaround of the discoms.

To ensure free and uninterrupted flow of power, every 1MW of new generation

capacity needs to have ~7MVA of equivalent transformation capacity added to the

system.

February 2016

4

Capital Goods | Transmission

Exhibit 2:

Every MW of new generation capacity needs around 7MVA of transmission capacity

Generation

Generation Capacity

Generating

Transformer

765 KV Generating system

MW

660

MVA

805

400 KV generating system

MW

500

MVA

610

220 KV generating system

MW

200

MW

224

22 KV to

765 kv

1080

765 KV to

400 kv

1080

400 KV

to 220

1620

Sending

400 kv

22 KV to

400 kv

811

Sending

220 KV

22 KV to

400 kv

500

wt

0.5

0.35

0.15

220 kv to 132 kv or

33kv

2430

Receiving

400 KV

400 to 220 kv

or 132 kv

811

Receiving

400 KV

220 kv to

132 kv

500

requirement

9.4

3.2

5

1622

3.2

Transmission Cap

requirement.

Sending

765 KV

Receiving

765 KV

400 KV

Transmission

220 or

132 KV

Transmission Cap

requirement.

6210

9.4

Transmission Cap

requirement.

1000

5

wt avg

4.7

1.1

0.75

6.6

Assessment of transformation capacity

765 KV generating system-1 phase system-6 transformation

400 KV generating system-1 phase system-4 transformation

220 KV generating system-3 phase system-4 transformation

However, India currently has only 2.3MVA of transmission capacity per megawatt of

generation capacity (far below the required 7MVA); this largely explains the

congestion that is visible in inter-state transmission of power. While Power Grid has

done a good job in terms of adding transmission capacity, it has not been sufficient.

Understanding this need, the government opted to open the sector to the private

sector (from Jan’11 for inter-state and from Jan’13 for intra state transmission).

Exhibit 3:

Transformation capacity analysis (220kv and above)

Plan

VI

VII

VIII

IX

X

XI

XII (Till December, 2015)

Generation

(MW)

42,584

63,636

85,795

105,045

132,329

199,877

284,303

Transformation

Capacity (MVA)

46,621

75,322

125,042

181,942

257,639

409,551

633,056

MVA/

MW

1.1

1.2

1.5

1.7

1.9

2.0

2.3

Source: CEA, MOSL

Another important event that contributed to the renewed focus on establishing a

robust and reliable transmission system was the northern region blackout in CY12

after a grid failure. Two severe power blackouts affected most of northern and

eastern India on July 30 and 31, 2012. The day 1 blackout affected over 300mn while

the day 2 blackout remains the largest power outage in history and affected over

620mn people, about 9% of the world population or half of India's population.

February 2016

5

Capital Goods | Transmission

Mapping transmission spending over 10

th

–13

th

Plan

Sharp pickup expected in intra – state spending

India currently has two transmission systems—Interstate Transmission System (ISTS)

and Intra-state Transmission System (Intra-STS). These systems together make up

337,000ckms of transmission lines (>220kv), 15,000MW of high-voltage direct

current (HVDC) terminals and 633, 000MVA of transformation capacity (incl. HVDC

lines).

Exhibit 4:

Existing and planned transmission system capacity across India

Description

Transmission Lines (220kv and above) ckm

HVDC Bipole lines

765kv

400kv

220kv

Total

HVDC terminal

HVDC back-to-back

HVDC Bipole terminals

Total- HVDC Terminal Capacity, MW

AC Substations transformation capacity

765 kV

400 kV

220kv

Total- AC Substation capacity, MVA

-

92,942

156,497

249,439

25,000

58,085

67,277

150,362

25,000

151,027

223,774

399,801

133,500

197,932

278,588

618,056

149,000

45,000

76,000

174,000

196,027

299,774

3,000

5,000

8,200

-

1,750

1,550

3,000

6,750

9,750

3,000

12,000

15,000

-

12,750

12,750

3,000

19,500

22,500

5,872

2,184

75,722

114,629

198,407

3,560

3,066

31,097

21,351

59,074

9,432

5,250

106,819

135,980

257,481

12,938

23,789

144,067

155,666

336,460

7,440

27,000

38,000

35,000

107,440

16,872

32,250

144,819

170,980

364,921

10th plan

end

11th plan

addition

11

th

Current

(Dec, 15)

12th plan

addition

12th

plan end

plan end

270,000

669,801

Source: CEA, MOSL

Exhibit 5:

Inter-state transmission system—current and proposed till FY17

Source: PGCIL, MOSL

February 2016

6

Capital Goods | Transmission

Spending on transmission in the 10

th

–13

th

Plans (FY03-22e)

Based on the capacity addition required for the inter-state (ISTS) and intra-state

transmission systems, a capex of INR2.6tn would be required over the 13

th

Plan. Out

of this, NR1.3tn would be spent on the ISTS and the balance INR1.3tn would be

spent by the states on the intra-state transmission network (INR300b on 400kv level

and the balance INR1, 000b primarily 220kv and below).

Exhibit 6:

Spending on transmission in the 10-13 Plan period

10thplan(FY03-07)

INR b

Inter State

Intra State

Total (transmission)

Total

200

255

455

190

42%

PGCIL

190

Share

95%

11th plan(FY08-12e)

Total

550

562

1,112

PGCIL

553

Share

98%

0%

12th plan(FY13-17e)

Total

1,200

550

PGCIL

1,000

100

Share

83%

18%

13th plan(FY18-22e)

Total

1,300

1,300

PGCIL

650

325

Share

50%

25%

th

553

50%

1,750

1,100

63%

2,600

975

40%

th

Source: MOSL **13 plan capex by PGCIL assuming a 50% share in ISTS

Exhibit 7:

11 – 13 plan transmission capex (FY08-22e)

INR m

Inter State(400/765kv/HVDC)

Intra State (220kv, 400kvv)

Total transmission capex

YoY Growth (%)

Inter- state transmission system growth (%)

Intra state transmission system growth (%)

Generation capacity addition – incl. renewables (MW)

Growth vs. previous plan (%)

67,926

11th Plan

550

562

1,112

12th Plan

1,200

550

1,750

57%

118%

-2%

120,000

13th Plan

1,300

1,300

2,600

49%

8%

136%

100,000

th

th

77%

-18%

Source: CEA, MOSL

ISTS spending growth would slow down to 8% in the 13

th

Plan from 118% seen in the

12

th

Plan. Intra-state spending would jump 136% over the 12

th

Plan as states step up

spending to upgrade their networks to align with inter-state transmission corridors.

Large growth in ISTS during the 12

th

Plan was driven by the INR670bn spending on

setting up nine High-Capacity Transmission Corridors (HCTCs), which have been set

up to link the generation plants.

A slowdown in ISTS spending along with higher state spending has the following two

repercussions for the sector:





With intra-state spending rising 136% to INR1.3t, states will need to step up

their spending requirements in building transmission capacity. PGCIL has already

started working with states to help them upgrade their existing infrastructure

(JVs formed with Bihar and Orissa); this can be either done through spending by

the states themselves or via the PPP route.

Not only is PGCIL required to win ISTS projects on tariff-based bidding going into

the 13th Plan, the spending growth on such projects is also seen slowing down

(8% in the 13th Plan v/s 118% in the 12th Plan); this implies that PGCIL will need

February 2016

7

Capital Goods | Transmission



to diversify its growth areas (in distribution and smart grid) to keep up its

momentum.

Focus will shift away from PGCIL ordering to state level orders since states

would need to increase their spending on upgrading their respective networks.

Working with different states vs. working only with PGCIL has its own set of

challengers including an elongated working capital cycle, multiple customers vs.

a single customer(PGCIL) but we are given to understand that competition in

state level projects are lower than PGCIL projects.

February 2016

8

Capital Goods | Transmission

So what does it mean for transmission players?

Focus now shifts to the state transmission capex

We expect a big jump in spending from the states on intra-state transmission and on

HVDC lines while capex in the 765kv/400kv segment (transformers, lines,

substations) will slow. Since state level spending would primarily be on the 220kv

level, we expect higher competitive intensity (versus 400/765kv) for orders as the

number of players participating would be higher.

Our estimate for equipment and voltage-wise spending during the 13

th

plan is

discussed below:



Transformers:

Based on transformation capacity addition of 288,000MVA

(220kv and above),

total spending on transformers in the 13

th

plan is expected

to be up 7% v/s the 12

th

Plan and 92% v/s the 11

th

Plan. More importantly,

transformer capex is likely to decline in the 765kv segment (INR24b, -47% YoY)

and increase in the 400kv (INR15bn, +9%) in the 13

th

plan. Orders for 1200kv

transformers are likely to start flowing only toward the beginning of the 14

th

Plan (2023 onwards). The 220kv segment is likely to see a sharp jump of 111% in

the 13

th

Plan to INR48b (v/s +10% in the 12

th

Plan) as states upgrade their

transmission network. Most players that are strong in the 400/765kv

transformers have not been very aggressive in the 220kv segment, which has

historically seen more competition and is a more commoditized market.

Exhibit 8:

Transformer capacity(MVA) across the industry in transmission and distribution

Company Name

ABB Ltd.

Alstom T & D India Ltd.

Crompton Greaves Ltd.

Siemens Ltd.

TBEA Shenyang

Bharat Heavy Electricals Ltd.

TRIL

Bharat Bijlee Ltd.

Emco Ltd.

Indo Tech Transformer Ltd.

Voltamp Transformers Ltd.

Schneider Electric

Sub- Total

Organized as a proportion of total

Total Industry capacity

Growth YoY (%)

FY15

20,410

25,075

40,000

15,000

15,000

45,000

33,200

15,000

20,000

7,450

13,000

7,000

256,135

65%

394,054

0%

Source: MOSL, Company

February 2016

9

Capital Goods | Transmission







Transmission lines:

Transmission line capex is likely to rise 36% to INR1440b in

the 13

th

Plan (+91% in the 12

th

plan), driven by a surge in capex in 220kv and

HVDC lines. Spending in 765kv and 400kv transmission lines would decline 9% to

INR574b. Spending for intra-state transmission in the 220kv lines is likely to be

INR600b (+145%) while HVDC lines are likely to witness spending of INR265bn

(+42%). Clearly, state spending on transmission lines is expected to pick up

substantially.

Substation:

Overall substation capex is expected to be INR980bn in the 13th

Plan (+32% over the 12

th

Plan), driven by spending on HVDC and 220kv

substations. Spending on 220kv substations is likely to be INR400bn (+111% over

the 12

th

Plan) while HVDC substation spending is pegged at INR195b in the 13

th

Plan (+39% over the 12

th

Plan). Cumulative spend on 765/400kv substations is

seen declining 7% over the 12

th

Plan to INR384b.

HVDC Substations:

Four large HVDC terminals (as mentioned below) are

envisaged during the 13

th

Plan, with a total 15GW capacity and estimated

spending of INR195b (+39% over the 12

th

Plan).



Champa Kurukshetra Phase 2 (3GW): Work to start from Q4FY16-Q117 and

likely to commission by FY18. The order has been awarded to Alstom SA for

INR33b and Alstom T&D’s share in the order is INR14.5b.



Chhattisgarh (Raigarh) to Tamil Nadu (6GW): Tenders already issued and

likely to be ordered by Q4FY16/Q117. The project has been given to PGCIL

on nomination basis and the cost is INR200b. We estimate HVDC’s portion

of the order at ~INR70-75bn. Three bidders have submitted bids for the

order— ABB, Siemens and Alstom SA. This line could be extended to Kerala

for evacuating another 3GW of power.



Orrissa to Badarpur (3GW): Still in the planning stage.



Assam (Rangia/Rowta) to Punjab (3GW): Still in the planning stage

February 2016

10

Capital Goods | Transmission

Exhibit 9:

Transmission capacity addition and capex over 11-13 plan (2008-2022e)

Description

Transmission Lines (>220kv ckm

HVDC Bipole lines

765kv

400kv

220kv

Total

HVDC terminal

HVDC back-to-back

HVDC Bipole terminals

HVDC Terminal Capacity, MW

AC Substations capacity

765 kV

400 kV

220kv

Total- AC Substation capacity, MVA

Transformer capex

765kv

400kv

220kv

Total capex

YoY Growth(%)

Transmission line capex

HVDC Bipole

765kv

400kv

220kv

Total transmission line capex

YoY Growth (%)

% of total transmission capex

Substation spending (Rs Mn MVA)

HVDC Bipole/ Back to back

765kv

400kv

220kv

Total

YoY Growth (%)

% of total transmission capex

-

92,942

156,497

249,439

25,000

58,085

67,277

150,362

25,000

151,027

223,774

399,801

133,500

201,117

283,439

618,056

149,000

45,000

76,000

270,000

174,000

196,027

299,774

669,801

79,000

49,000

160,000

288,000

253,000

245,027

459,774

957,801

10th Plan

end

5,872

2,184

75,722

114,629

198,407

11th plan

addition

3,560

3,066

31,097

21,351

59,074

11th plan

end

9,432

5,250

106,819

135,980

257,481

Current

(Dec,15)

9,432

23,789

144,067

155,666

336,460

12th plan

addition

7,440

27,000

38,000

35,000

107,440

12th Plan

end

16,872

32,250

144,819

170,980

364,921

13th plan

addition

10,600

22,200

30,000

85,714

148,514

13th Plan

end

27,472

54,450

174,819

256,694

513,435

th

3,000

5,000

8,200

-

1,750

1,550

3,000

6,750

9,750

3,000

12,000

15,000

-

12,750

12,750

3,000

19,500

22,500

-

15,000

15,000

3,000

34,500

37,500

7,500

17,426

20,183

45,109

44,700

13,500

22,800

81,000

80%

23,700

14,700

48,000

86,400

7%

89,000

45,990

248,776

170,808

554,574

50%

186,000

324,000

304,000

245,000

1,059,000

91%

61%

265,000

288,600

285,000

600,000

1,438,600

36%

55%

19,250

75,000

145,213

168,193

407,655

37%

140,250

298,000

112,500

190,000

740,750

82%

42%

195,000

237,000

147,000

400,000

979,000

32%

38%

Source: CEA, MOSL

February 2016

11

Capital Goods | Transmission

Exhibit 10:

HVDC lines planned (11–13 Plans)

Description

Chandrapur-Padghe (Alstom)

Rihand-Dadri (Siemens)

Talcher-Kolar

Balia-Bhiwadi

Biswanath-Agra (ABB)

Champa– Kurukshetra (Alstom)

LILO of Bishwanath Chariyalli– Agra at

Alipurduar(ABB)

Mundra -Mohindergarh (Siemens)

Champa - Kurukshetra - II (Alstom)

Chhatisgarh -Tamil Nadu

Orrisa - Badarpur +/-800kv HVDC

Assam(Rangia/Rowta) -

Punjab(Gurdaspur) +/-800kv

Sub-total (bipole)

Vindhyachal

Chandrapur (Alstom)

Gazuwaka

Sasaram (Alstom)

Sub-total (b-to-b)

TOTAL – HVDC Terminal Capacity, MW

Type

bipole

bipole

bipole

bipole

bipole

bipole

bipole

bipole

bipole

bipole

Bipole

Bipole

Agency

MSEB

PGCIL

PGCIL

PGCIL

PGCIL

PGCIL

PGCIL

Adani

PGCIL

PGCIL

NA

NA

5,000

b-to-b

b-to-b

b-to-b

b-to-b

PGCIL

PGCIL

PGCIL

PGCIL

500

1,000

1,000

500

3,000

8,000

10,500

500

1,000

1,000

500

3,000

13,500

9,000

19,500

500

1,000

1,000

500

3,000

22,500

2,500

10

Plan end

1,500

1,500

2,000

th

th

Expected at

11th

12th/early the end of

Plan end 13th Plan 12th/early

13th Plan

1,500

1,500

500

2,500

3000

3000

3000

1,500

1,500

2,500

2,500

3000

3000

3000

2,500

13th

plan

End of

13th Plan

1,500

1,500

2,500

2,500

3,000

3,000

3,000

2,500

3,000

6,000

3,000

3,000

15000

6,000

19,500

-

9,000

500

1,000

1,000

500

3,000

15,000

22,500

Source: MOSL

Exhibit 11:

Inter-regional transmission capacity (MW) envisaged until the 13 Plan

Transmission Corridor(MW)

East- North

East - West

East - South

East- North East

West - North

West - South

North East - North

Total

Addition in capacity over the plan period (in MW)

10th Plan

end

3,430

1,790

3,130

1,260

2,120

1,720

-

14,050

11th Plan

end

10,030

4,390

3,630

1,260

4,220

1,520

-

25,650

11,600

Existing

(Jan, ’16)

15,830

12,790

3,630

2,860

12,920

7,920

1,500

47,450

12th Plan

balance

2,100

-

4,200

-

4,000

-

4,500

22,700

End of 12th 13th Plan

Plan

addition

17,930

12,790

7,830

2,860

16,920

7,920

6,000

72,250

46,600

8,800

8,400

4,200

-

15,600

14,400

3,000

54,400

End of 13th

Plan

26,730

21,190

12,030

2,860

32,520

22,320

9,000

126,650

54,400

th

Source: CEA, MOSL, Note INR1.2trn spend in 12

th

plan and INR1.3trn in 13

th

plan

February 2016

12

Capital Goods | Transmission

Exhibit 12:

Company-wise presence across the transmission value chain

Name of company

BHEL

L&T

A BB In dia

Sieme ns India

Crompton Gre ves

Alstom T&D India

KEC International

Kalpataru Power

Techno El ctric

Jyot i Structures

Skipper Ltd

Voltamp

Bharat Bijlee

T IL

In o Tech T ansformer

Sterlite Technol ogies

√

√

√

√

√

√

√

√

√

√

Source: MOSL

√

Transmission Line

Substation

√

√

√

√

√

√

√

√

√

√

√

√

√

√

Transformer

√

Conductor

Exhibit 13:

Inter-regional transmission links planned till FY22e

Source: CEA

February 2016

13

Capital Goods | Transmission

Higher voltage and new technologies the way forward in

transmission

Advantage MNC T&D players as limited competition

The Indian transmission network (>132kv) has been continuously moving toward

higher voltages and new technologies. Currently, transmission lines are primarily run

at 400/765kv voltage levels; PGCIL intends to move to 1200kv in the 14

th

Plan. Intra -

state transmission networks are being upgraded from 132kv level to 220/400kv.

Higher voltages lead to more efficient transfer of power while using lesser space

New technologies being adopted to make the grid more reliable and efficient

include HVDC, dynamic compensation, PMU based technology/wide-area

monitoring system (WAMS), phase shifting transformers, series reactors, and

1200kV UHVAC.

Below we discuss a few details about these technologies:



HVDC:

A high-voltage, direct current (HVDC) electric power transmission system

uses direct current for the bulk transmission of electrical power instead of the

more common alternating current (AC) systems. HVDC are less expensive for

long-distance transmission and suffer lower electrical losses.

Exhibit 14:

Advantages of shifting to higher voltage levels

Voltage Level

ROW Meters(M)

Capacity (MW)

MW/m

132 kV

27

70-80

3

220 kV

35

160-170

5

400 kV

52

500-600

15

765 Kv

64

2500-3000

45

+500 kV

HVDC

46

2000-2500

48

+800 kV

HVDC

70

6000-6400

1200 kV

90

6000-8000

90

90

Source: CEA, MOSL









SVC/STATCOM.

To maintain voltages within limits and grid stability,

STATCOM/SVC are required as dynamic compensators. A static synchronous

compensator (STATCOM) is a regulating device used on alternating current

electricity transmission networks; when connected to a source of power, it can

also provide active AC power. PGCIL is looking to order a total of 14 SVC’s with

two already ordered out (Siemens and Techno Electric/Rongxin)

Wide Area Monitoring System (WAMS).

The Indian power systems’ dimensions

and complexity are increasing, which necessitates better visibility of the grid

system. The dynamic behaviour of a power system can be observed on almost a

real-time basis at the control centre, thereby improving/enhancing situational

awareness for operators and increasing the grid’s deliverability.

Phase Shifting Transformers.

Phase shifting transformers (PST) help control the

real power flow in transmission lines and systems inter-ties and allow for better

utilization of existing networks by balancing the loading in parallel paths.

Reactors.

To meet the growing power generation (necessitated due to rising

demand), new lines are being added—this has resulted in an increase in

instances of short circuit. Series reactor has been considered for limiting the

occurrence of fault current and the resulting short circuit.

14

February 2016

Capital Goods | Transmission



1200kV UHVAC technology.

Power Grid has lead the way in establishing 765kV

AC technology for high-capacity transmission corridors in the past few years.

However, in view of the growing right-of-way concerns, there is a need for

augmenting transmission of power in a given right-of-way. Therefore, the

world’s highest transmission voltage level of 1200kV UHV-AC was established in

India in 2012 with the charging of National Test Station at Bina in MP..

Exhibit 15:

Indian grid moving toward higher voltage levels over the years

Year

1950

1960

1970

1980

1990

2000

2007

2010

2023e

Voltage

220

220

220

220

400

500kv DC

765kv Ac

800kv Dc

1200 kv Ac

Source: CEA, MOSL

With most of the incremental transmission capacity likely to be put up at high

voltages (765/400kv), the player-wise capabilities across various equipment types is

listed below.

Exhibit 16:

Capabilities across high-voltage equipment

Name of Company

ABB India

Siemens India

Alstom T&D India

Toshiba India

TBEA Shenyang India

Crompton Greaves

Hyosung

765kv

Y

Y

Y

Y

Y

Y

Y

1200kv

Y

Y

Y

Y

Y

Y

Y

transformer transformer

HVDC

Y

Y

Y

Y

N

N

N

StatCom

Y

Y

Y

N

N

N

N

400/765kv

AIS

Y

Y

Y

Y

N

Y

Y

400kv

GIS

Y

Y

Y

Y

N

Y

Y

765kv

GIS

Y

Y

Y

Y

N

N

Y

PMU

Y

Y

Y

NA

N

N

N

Source: CEA, MOSL

Exhibit 17:

Company wise exposure to the transmission sector

Name of Company

ABB India

Siemens India

Alstom T&D India

Crompton Greaves

BHEL

L&T

KEC international

% of total sales

55%

25%

100%

25%-30%

5-7%

8-10%

70%

Source: MOSL,** includes export sales and overseas markets as well

February 2016

15

Capital Goods | Transmission

Competitive intensity lower post implementation of

domestic manufacturing clause

To promote the government’s

‘Make in India’

initiative, PGCIL has already put in

place stringent norms to force equipment suppliers to set up factories in India. Even

before the current push, PGCIL inserted a domestic manufacturing clause for its

765kv transformers—which led to companies (Alstom T&D, ABB, and TBEA

Shenyang) setting up factories at Baroda over the last 5-6 years.

As highlighted in the chart below, PGCIL has expanded the domestic manufacturing

clause across equipment types; this could lead to more Chinese/Korean companies

setting up shop in India. Media reports indicate that Baoding (Chinese transformer

manufacturer) has started constructing a 10,000MVA transformer facility at Baroda

while Hyosung (Korean GIS manufacturer) is putting up a switchgear factory near

Pune.

Source: PGCIL

The Make in India clause benefits local players in two ways:



It weeds out non-serious players who were previously importing and dumping

equipment from their overseas factories. This is in turn implies a bigger pie for

existing players and is very evident in the case of 765kv transformers where

Koreans have completely left the market after PGCIL imposed the domestic

clause.



Improves pricing for locally made equipment as the domestic players have a

more level playing field versus foreign competition (read Chinese and Korean

players).

February 2016

16

Capital Goods | Transmission

765kv transformers - competition down on domestic manufacturing clause

In order to promote domestic manufacturing of 765kv transformers, PGCIL had

introduced a mandatory supply of transformer from the Indian factory of the

vendor. This was needed since a transformer has to run for 20-25 years and there

had been a surge in imports of 765kv transformers from Korea and China.

As we highlight in the chart below, the Koreans had a 22% market share in 765kv

transformers while the Chinese had a 44% share in FY10; in FY12, the share of

Korean manufacturers came down to 2% and since then have completely exited the

market since they were not willing to set up a transformer plant. Similarly, Chinese

transformer manufacturers Baoding and Xian have also exited the market as they

are not able to meet qualification norms as above.

This has led to just 4-5 players participating in 765kv transformer bids from PGCIL

namely, Alstom T&D, TBEA Shenyang, ABB India, Siemens India, and Crompton

Greaves. With no new players expected to set up a factory in India, we expect the

competition to be limited to these players.

Exhibit 18:

Market share in 765kv transformers – Power Grid

Korean

34%

Chinese

Indian

43%

53%

46%

87%

77%

86%

44%

27%

30%

2010-11

46%

2%

2011-12

54%

0%

2012-13

13%

0%

2013-14

23%

0%

2014-15

14%

YTD'16

22%

2009-10

Source: PGCIL, MOSL

765kv substations – impact yet to be seen

Within 765kv substations, we note that historically the Indian players had a

dominant share. However, there has been a shift of share towards the

Koreans/Chinese over the past two years. This is primarily due to PGCIL moving

towards award of GIS substations versus AIS earlier; ~65-70% of substation orders in

FY15/YTD’16 have been for GIS. YTD FY16, Korean player Hyosung had a 44% share

in the 765kv substation market at the expense of Indian players.

We understand that PGCIL has introduced a domestic manufacturing clause in 765kv

GIS equipment as well – this requires that at least one bay needs to be made from a

factory in India. This effectively means that vendors would need to set up a factory

in India. Hyosung, which is the only Korean player in this segment, is looking to set

up a 765kv GIS factory near Pune. Amongst the Chinese, North East Electric and

Pinggao Group have been quite aggressive in this market. These two players would

also have to set up a manufacturing base in India in order to continue supplies to

PGCIL – if not, they would have to exit the market.

February 2016

17

Capital Goods | Transmission

Exhibit 19:

Market Share in 765kv substations - PGCIL

Korean

Chinese

Indian

23%

82%

25%

63%

37%

33%

23%

44%

YTD'16

100%

100%

96%

53%

4%

2011-12

12%

6%

2012-13

2013-14

2009-10

2010-11

2014-15

Source: PGCIL, MOSL

Within the substation segment, PGCIL has been increasingly moving towards GIS

substation with ~60-70% of substation orders during FY15 and YTD FY16 have been

for GIS substations (400/765kv). The Chinese (North East Electric Group, Xian and

Pinggao Group) together had a 35% share while Hyosung had another 50% share in

orders YTD’16.

Exhibit 20:

GIS substation market share – PGCIL (%)

Korean

18%

Chinese

Indian

15%

35%

49%

33%

2014-15

50%

YTD'16

Source: PGCIL, MOSL

Transmission lines – consolidation is evident

While there is no domestic manufacturing clause there for transmission line

companies, PGCIL has over the past two years tried to restrict the bidders to only

serious players who are able to execute on time. Vendors who have won orders

earlier but not able to execute on time are not being technically qualified and

therefore not able to participate in the financial bids.

We note that PGCIL works on a regulated model where it gets a fixed ROE on

capitalized assets – however, it does not earn anything on CWIP. A consistent delay

in the execution of projects leads to higher CWIP and therefore PGCIL took the

decision to prune its vendor list to only the serious bidders who have the requisite

experience in execution of projects.

There is a clear consolidation in the market share of players – the top four players

now account for ~75% of the orders awarded by PGCIL during YTD’16. We highlight

the period during FY11-FY12 when a large number of new players jumped into the

transmission EPC fray – this was also on account of a sharp slowdown in orders in

other infrastructure projects. However, since then we have seen quite a few of

these players exit post not being able to execute the projects on time or have been

February 2016

18

Capital Goods | Transmission

black listed by PGCIL and therefore their financial bids are not being opened. This

has led to a consolidation in the existing players who have proved their execution

capability.

Exhibit 21:

Transmission lines market share – PGCIL

Bajaj Electrical

KEC International

100%

75%

50%

25%

0%

FY09

FY10

FY11

FY12

FY13

FY14

FY15

YTD'16

Gammon India

L&T

EMC

TATA Project

Kalpataru Power

Others

February 2016

19

Capital Goods | Transmission

Tariff-based bidding for transmission projects

Preference for vendors with established track record

The Electricity Act, 2003 opened up the transmission sector to private sector

participation subject to obtaining a transmission license. The act provides for

transmission licenses by the CERC and SERC and for determination of tariffs under

section 61/62 through competitive tariff-based bidding. A model transmission

agreement (MTA) was also notified in May, 2012.

All new transmission lines (inter- state) shall be ‘bid out’ from

January 2011

and

only lines that are of national interest shall be given to Power Grid on a nomination

basis. All intra-state transmission networks to have tariff-based competitive bidding

(TBCB) from

January 1, 2013.

There are two ways for ‘bidding out’ the transmission networks: (1) Model

transmission agreement using the lowest VGF/grant as notified by the Planning

Commission or (2) the Standard Bidding Documents (SBD) as notified by the Ministry

of Power. For most of the inter-state transmission projects PFC/REC use the SBD

method while some states have used the VGF model as notified by the Planning

Commission.

Exhibit 22:

Procedure for bidding out of transmission projects on tariff based bidding







Project approval by empowered committee

Bid process coordinator selected (PFC and REC)

RFQ notification and bid invitation

Bidder 1 / 2 / N







Response to RFQ submission and evaluation by BPC

Selection of qualified bidders. Issuance of RFP to selected

bidders

(a) Responsiveness check, (b) Compliance with submission

requirements, (c) Evaluation of qualifying requirements

Bidder 1 / 2 / N







Annual transmission charges quoted for the contract years

(35 years) in the RFP

Transmission charges levelized over a period from the

scheduled COD of the project up to 35 years

Project awarded to L1 (lowest) bidder

CERC

Source: CERC, MOSL

February 2016

20

Capital Goods | Transmission

PGCIL has got 11 projects out of the 20 that it had originally bid for, which implies a

~50%

market share

in such projects. PGCIL was also awarded projects worth

INR360b (lowered to INR260b) on a nomination basis by the government; of these,

the INR260b Raichur-Pugular HVDC line project was done on Tamil Nadu’s

insistence, as the state wanted this line to come up on time.

Developers prefer EPC players/equipment manufacturers with established

track record

Competitive intensity was quite high in the initial tariff-based projects with 10-15

players participating in bids. However, in recent bids, the number of players

declined to 5-7; it seems that most players have realized that executing the projects

is not easy because of right-of-way and clearance-related issues that developers

face.

As per our discussion with project developers as also our utilities analyst, levelized

tariff needs to be in the region of 13%-18% of project cost to earn 10%-28% ROE.

This is also evident from CERC recommended tariff which typically are in the same

range and assume a fixed ROE of 15.5%

(See table on next page for detailed project

wise breakup).

The two key components in tariff based bidding, in our view are:





Capital Cost of the project

– This would depend not only on the equipment and

the related construction costs but also timely completion of the project. Quite a

few times, the project developers tie up with the equipment suppliers/EPC

players to lock in the capital cost of the project and then use this arrive at the

bid tariff. We note that the project IRR’s/ROE’s are dependent on timely

execution and delays could led to costs escalation and a fall in expected

IRR’s/ROE. This would imply the project developers would like to stick to

equipment manufacturers/EPC players who have a proven execution record

both in terms of reliability o equipment and timely completion as per deadlines.

Our discussions with a few private transmission developers indicate that they

would prefer to stick with Indian equipment manufacturers since the

transmission line has to be run for 35 years and an equipment failure could lead

to penalties.

Interest cost

– This would depend on the credit worthiness of the developer as

also whether the borrowing is domestic or international. PGCIL has the benefit

of lower interest costs given its high credit ratings.

February 2016

21

Capital Goods | Transmission

Exhibit 23:

Transmission project awarded on tariff based bidding

Project

East North Interconnection

transmission project

Jabalpur Transmission project

Bhopal Dhule Transmission Co Ltd

Nagapattinam-Madhugiri

Patran Transmission Co. Ltd.

State

Developer

Award

Date

Jan-10

Jan-11

Jan-11

Mar-12

Project Levellised

cost Revenue

(INR m)

(L1)

8,000

13,000

19,000

10,250

2,000

1,188

1,421

1,995

987

274

365

589

1,174

1,440

2,580

293

1,197

2,311

1,796

4,377

594

887

CERC

tariff

Tariff as

% of cost

15%

11%

11%

10%

14%

12%

13%

13%

10%

10%

Assam, West Bengal &

Sterlite Technologies

Bihar

Madhya Pradesh &

Sterlite Transmission Projects

Chhattisgarh

Gujarat, Madhya Pradesh

Sterlite Transmission Projects

& Maharashtra

Tamil Nadu

PGCIL

Techno Electric and

Haryana

Engineering

Sterlite Grid

Sterlite Grid

Essel Infraprojects Ltd

PGCIL

PGCIL

Patel Engg, Simplex Infra &

BS Transcomm

PGCIL - discontinued

PGCIL

L&T IDPL

Sterlite Grid

PGCIL

Essel Infraprojects Ltd

Reliance Infra

Reliance Infra

Kalpatru Power & Techno

Electric

GMR Energy

GMR Energy

Isolux Corsan Concesiones

S.A.

Cobra-MEIL Consortium

PGCIL

PGCIL

PGCIL

PGCIL

PGCIL

Strelite Grid

Adani Power

Adani Power

Adani Power

PGCIL

KEC International

Kalpataru Power

Transmission System for Part ATS of

Rajasthan

RAPP U-7 & 8

Eastern Region System

West Bengal, Jharkand

Strengthening Scheme-VII

Darbhanga-Motihari - ERSS VI

Talcher-II Transmission Co Ltd

Odisha , AP

North Karanpura Transmission Co Uttar Pradesh , MP,

Ltd

Chhatisgarh, Haryana

Raichur Sholapur Transmission Co

Karnataka

Ltd

Vemagiri A Transmission System Ltd Andhra Pradesh

Vizag Transmission Ltd

NA

Kudgi Transmission Ltd

NA

NRSS XXIX

NA

NRSS XXXI (A)

NA

NRSS XXXI (B)

NA

WRSSS-II Project B (Maharashtra) Maharashtra

WRSSS-II Project C (Gujarat)

Gujarat

Transmission system for 1320MW

Haryana

Jhajjar TPP

Bikaner-Deedwana-Ajmer-Sujangarh

Rajasthan

transmission

Hindaun -Alwar Transmission line Rajasthan

765kV S/C Mainpuri-Bara line with

Uttar Pradesh

765/400kV AIS at Mainpuri

765kV S/C Mainpuri -Hapur &

Mainpuri -Gr Noida lines with

Uttar Pradesh

765/400kV AIS at Hapur & Gr Noida

Unchahar Transmission

Uttar Pradesh

NCC Project

Andhra Pradesh

Vindhyachal V Transmission

Madhya Pradesh

Strengthening Scheme

Gadarwara STPS (2 x 800 MW) of

Madhya Pradesh

NTPC (Part A)

Gadarwara STPS (2 x 800 MW) of

Madhya Pradesh

NTPC (Part B)

Maheshwaram (Hyderabad)

Andhra Pradesh

765/400 kV Pooling S/s

Additional System Strengthening

Madhya Pradesh

Scheme, Sipat

Chattisgarh (A) transmission project Chattisgarh

Chattisgarh (B) transmission project Chattisgarh

Vemagiri II transmission line

Andhra Pradesh

400kv D/C Bikaner to Sikar

Rajasthan

Bhutan Interlink - Alipurduar Project Bhutan to East India

Sep-13

Sep-13

Dec-09

Dec-09

Dec-10

Mar-12

Jul-13

Jul-13

May-14

Feb-14

Jan-14

Nov-07

Nov-07

Apr-10

Oct-10

Oct-10

Jul-11

May-11

Mar-14

Feb-15

Feb-15

Feb-15

Jul-15

Jul-15

Jul-15

Jul-15

Oct-15

Oct-15

Oct-15

3,100

4,500

9,347

14,000

27,000

4,400

13,000

12,777

13,500

25,000

4,000

6,780

9,736

4,064

4,500

2,000

574

55,000

45,000

1,200

10,000

12,000

25,250

23,600

3,960

8,630

8,230

19,760

63,000

2,600

18,000

537

2,369

2,328

4,175

923

7%

9%

18%

13%

18%

15%

13%

NA

NA

12%

NA

NA

540

8,700

8,750

167

1000

2,109

2,901

2,568

550

790

1,324

1,780

3,590

294

1,294

191

4,214

5,935

5,268

16%

19%

14%

10%

18%

11%

11%

14%

9%

16%

9%

6%

11%

7%

Source: MOSL, PFC

February 2016

22

Capital Goods | Transmission

To level the playing field for the private sector vis-à-vis PGCIL, the government is

looking to initiate several other measures. The measures include separation of

POSOCO from PGCIL—POSOCO is in charge of five regional and central load dispatch

centers. Another move being planned is to have an independent company for

collection of transmission charges from states—currently, this is being done by

PGCIL.

Exhibit 24:

Changing dynamics in the transmission sector

Description

Grid Construction

Grid Control

Collection of transmission charges

Earlier

PGCIL - award on nomination basis

PGCIL

PGCIL

Current/Proposed

PGCIL and Private players

POSOCO hived off from PGCIL to control grid

New company to be formed for collection of transmission charges

Source: Industry, MOSL

February 2016

23

Capital Goods | Transmission

Planning the transmission system

State-wise demand-supply gap rolled up to pan-India level

A pickup in the pace of generation capacity addition (primarily from the private

sector),the higher distance between source of generation and end-users along with

power trading has led to a greater need for a robust transmission system. The 2012

northern region blackout has brought the focus back on having a reliable and

dependable system that can withstand the load demand of various regions and

states.

Assessment the key to planning

State - and region-wise import and export scenarios are assessed by using the

available pipeline of generation plants (projected to come up in the 12

th

and 13

th

Plans); after this, to meet possible import/export requirements, a projection of the

additional transmission system is made by using CEA’s system studies. The 18

th

Electric Power Survey is used as the basis for demand projection by each

state/region for the 12

th

and 13

th

Plans.

The transmission network is planned in a way that it meets peak load demand

across seasons. On a pan-India basis, base load is ~70% of peak load—up to 80%

load is present 50% of the time and peak period of 90-100% load only 5% of the

time, as per CEA.

Modeling the transmission system for 12

th

and 13

th

Plans (2013-2022)

The transmission system requirement is modelled at the state level, following which

it is aggregated at the regional level and then at the national level. In any given

state, there can be state-sector generation tied up completely to the host state,

central-sector generation serving more than one state, and power plants belong to

state-sector and inter-state IPPs.

Each state has its own power demand. Power availability from all the sources in a

state minus its own demand gives net import or export of that state. The

aggregation of import/export requirement of states within a region, and taking into

consideration the diversity factor, translates into inter-regional power transfer

requirements. The transmission system is planned to cater to the inter-state and

inter-regional power transfer requirements. While planning the inter-state

transmission system, the diversity in demand has to be also kept in mind.

February 2016

24

Capital Goods | Transmission

Exhibit 25:

Planning methodology

Source: CEA, MOSL

As per the Electric Power Survey, peak demand would rise to ~200GW by the end of

the 12th Plan (FY17) and to 284GW by the end of the 13th Plan (FY22) from 130GW

by the end of the 11th Plan. The peak demand by FY22 will be more than double the

load as at the end of the 11th Plan.

Exhibit 26:

Regionwise peak power demand

Region wise peak demand/load

NR

WR

SR

ER

NER

Andaman & Nicobar Island

Laskhwadeep

All India

12 plan

(2016-17)

60,934

62,015

57,221

24,303

2,966

67

11

199,540

th

13 plan

(2021-22)

86,461

86,054

82,199

35,928

4,056

89

18

283,470

th

Plan growth

(%)

7%

7%

8%

8%

6%

6%

10%

7%

Source:CEA, MOSL

Demand is estimated to grow by 9% in the 12

th

Plan and 7% in the 13

th

Plan; this

implies electricity demand growth of 1.0x-1.5x GDP growth during the period.

Transmission system planning is done is a way that it is able to meet the estimated

peak and off-peak load demand in the system.

Installed capacity as at end of 12

th

and 13

th

Plans

After determining the peak demand by the end of the 13th Plan, it is important to

understand the installed generation capacity by state/region in the same period.

The knowledge would help understand the surplus/deficit situation for each state

and, therefore, the resultant need for ISTS.

As per the CEA, capacity added till Dec, 15 of the 12

th

Plan was ~72GW and a total of

~120GW could be added (inclusive renewable energy sources of 25GW) during the

plan period. Another 100GW would be added during the 13

th

Plan to take the total

installed capacity (including renewables) to 430GW by FY22.

February 2016

25

Capital Goods | Transmission

Exhibit 27:

State wise projection of demand for 12 and 13 Plans (MW)

State/UTs

Delhi

Haryana

Himachal Pradesh

Jammu & Kashmir

Punjab

Rajasthan

Uttar Pradesh

Uttarkhand

Chandigarh

Northern Region

Goa

Gujarat

Chhattisgarh

Madhya Pradesh

Maharashtra

D. & N. Haveli

Daman & Diu

Western Region

Andhra Pradesh

Karnataka

Kerala

Tamil Nadu

Puducherry

Southern Region

Bihar

Jharkhand

Orissa

West Bengal

Sikkim

Eastern Region

Assam

Manipur

Meghalaya

Nagaland

Tripura

Arunachal Pradesh

Mizoram

North Eastern Region

Andaman & Nicobar Islands

Lakshadweep

All India

130,006

9,151

21,069

615

301

42,352

14,054

10,545

3,516

12,813

335

37,599

2,031

1,030

3,589

6,592

100

14,707

1,112

116

319

111

215

121

82

1,920

2011-12

5,031

6,533

1,397

2,385

10,471

8,188

12,038

1,612

263

40,248

527

10,951

2016-17

6,398

10,273

1,900

2,687

12,342

13,886

23,081

2,189

426

60,934

815

19,091

4,687

13,904

28,645

944

441

62,015

22,445

13,010

4,669

20,816

630

57,221

5,018

4,616

5,672

11,793

144

24,303

1817

346

445

185

340

135

285

2,966

67

11

199,540

9%

9%

6%

9%

8%

8%

10%

4%

6%

10%

13%

9%

20%

35%

10%

12%

8%

11%

10%

24%

7%

11%

10%

2%

28%

9%

CAGR(12th Plan)

5%

9%

6%

2%

3%

11%

14%

6%

10%

9%

9%

12%

2021-22

9,024

14,244

2,589

4,217

14,552

19,692

36,061

2,901

559

86,461

1,192

26,973

6,599

18,802

39,622

1,297

605

86,054

33,194

18,403

6,093

29,975

782

82199

9,306

6,341

6,749

17,703

176

35,928

2,534

497

596

271

472

177

352

4,056

89

18

283,470

CAGR (13th Plan)

7%

7%

6%

9%

3%

7%

9%

6%

6%

7%

8%

7%

7%

6%

7%

7%

7%

7%

8%

7%

5%

8%

4%

8%

13%

7%

4%

8%

4%

8%

7%

8%

6%

8%

7%

6%

4%

6%

6%

10%

7%

Source:CEA,MOSL

th

th

February 2016

26

Capital Goods | Transmission

Exhibit 28:

Installed capacity by the end of 12 and 13 Plans

Generation

Region

NR

WR

SR

ER

NER

Total

11th Plan End

54,467

66,064

55,821

29,761

2,884

208,996

Addition in 12th Addition in 13th

Plan

30,849

52,492

20,061

16,858

3,537

120,011

Plan

16,890

20,262

23,076

31,195

8,202

99,625

Total (End of

13th Plan)

102,206

148,818

118,958

77,813

14,623

430,418

Present

45,934

41,335

39,015

15,888

2,164

1,35,918

Demand

12th Plan

60,934

62,015

57,221

24,303

2,966

199,540

13th Plan

86,461

86,054

82,199

35,928

4,056

283,470

th

th

The load generation balance report at the end of the 13

th

Plan indicates that

northern region would have a deficit of ~19-22GW while the southern region would

have a deficit of 13-19GW. The surplus in the western region is pegged at 12-16GW.

Thus, power from surplus regions will need to be carried into deficit regions.

Exhibit 29:

India Summer peak inter-regional flows (In MW)

2021-22 load generation balance report

Source: CEA

February 2016

27

Capital Goods | Transmission

Key inter-regional transmission corridors

Accounting for the deficit/surplus in various regions, the inter-regional transfer

capacity is seen increasing to 127GW by the end of the 13

th

Plan (FY22) from 48GW

currently. A total of 148,514ckms of transmission line, 15,000MW of HVDC terminal

capacity and 271,000MVA of transformation capacity of >220kv would need to be

set up in the 13

th

Plan (2017-22).

Exhibit 30:

Inter-regional transmission capacity (MW) envisaged until the 13 Plan

Transmission Corridor(MW)

East- North

East – West

East – South

East- North East

West – North

West – South

North East – North

Total

Addition in capacity over the plan period (in MW)

10th Plan

end

3,430

1,790

3,130

1,260

2,120

1,720

-

14,050

11th plan

end

10,030

4,390

3,630

1,260

4,220

1,520

-

25,650

11,600

Existing

(Jan, ’16)

15,830

12,790

3,630

2,860

12,920

7,920

1,500

47,450

12th plan

addition

2,100

-

4,200

-

4,000

-

4,500

22,700

End of 12th 13th plan

plan

17,930

12,790

7,830

2,860

16,920

7,920

6,000

72,250

46,600

addition

8,800

8,400

4,200

-

15,600

14,400

3,000

54,400

End of 13th

plan

26,730

21,190

12,030

2,860

32,520

22,320

9,000

126,650

th

54,400

Source: CEA, MOSL

February 2016

28

Capital Goods | Transmission

Annexures

Exhibit 31:

Inter-regional transmission links planned till FY22

Source: CEA

Exhibit 32:

Inter-state transmission system current and proposed till FY17

Source: CEA, MOSL

February 2016

29

Capital Goods | Transmission

Exhibit 33:

Inter-regional links at the end of 12th and 13th Plans

East – North (MW)

Dehri-Sahupuri 220 kV S/c

Sasaram HVDC back-to-back

Muzaffarpur-Gorakhpur 400 kV D/c (with Series Cap+TCSC)

Patna – Balia 400kV D/c (Quad)

Biharshariff – Balia 400kV D/c(Quad)

Barh – Balia 400kV D/c (Quad)

Gaya - Balia 765kV S/c

Sasaram bypassing(additional capacity)

Sasaram - Fatehpur 765kV2x S/c

Barh-II-Gorakhpur 400kV D/c (Quad) line

Gaya-Varanasi 765 kV S/c line

Biharsharif - Varanasi 400kV D/c line with quad conductor

Tillaiyya – Balia 765kV D/c line, one ckt via Gaya

Angul (ER- Orissa) – Badarpur (NR-Delhi) +800kV, 6000MW HVDC bipole with 3000MW

terminal Capacity

Sub-total

EAST - WEST

Budhipadar-Korba 220 kV 3 ckts.

Rourkela-Raipur 400 kV D/c with series comp.+TCSC

Ranchi –Sipat 400 kV D/c with series comp.

Rourkela-Raipur 400 kV D/c (2nd) with series comp.

Ranchi - Dharamjayagarh - WR Pooling Station 765kV S/c line

Ranchi - Dharamjaygarh 765kV 2nd S/c

Jharsuguda-Dharamjaygarh 765kV D/c line

Jharsuguda - Dharamjaygarh (to be LILOed at Raigarh Tamnar) 765kV D/c line (2nd)

Jharsuguda - Raipur Pool 765kV D/c line

Sub-total

WEST-NORTH

Auriya-Malanpur 220 KV D/c

Kota - Ujjain 220 KV D/c

Vindhyachal HVDC back-to-back

Gwalior-Agra 765 kV 2 x S/c

Zerda-Kankroli 400kV D/c

Champa Pool- Kurukshetra HVDC Bipole

Gwalior-Jaipur 765kV 2xS/c lines

RAPP-Sujalpur 400kV D/c

Adani(Mundra) - Mahendranagar HVDC bipole

Up gradation of Champa – Kurukshetra +800kV, 6000MW HVDC bipole with 3000MW

terminal Capacity

Jabalpur – Orai 765kV D/c line

Banaskanta – Chittorgarh 765kV D/c line

Dhanvahi – Fatehpur 765kV D/c line

Sub-total

EAST- SOUTH

Balimela-Upper Sileru 220kV S/c

Gazuwaka HVDC back-to-back

Talcher-Kolar HVDC bipole

Upgradation of Talcher-Kolar HVDC Bipole

Angul - Srikakulum 765kV D/c line

Angul - Srikakulum 765kV D/c line (2nd)

Sub-total

WEST- SOUTH

Chandrapur HVDC back-to-back

Kolhapur-Belgaum 220kV D/c

Ponda – Nagajhari 220kV D/c

Raichur - Sholapur 765kV S/c line (PG)

Raichur - Sholapur 765kV S/c line (Pvt. Sector)

February 2016

Balance

End of During End of

Present by 12th

12th Plan 13th plan 13th plan

Plan

(MW)

(MW)

(MW)

(MW)

(MW)

130

130

130

500

500

500

2,000

2,000

2,000

1,600

1,600

1,600

1,600

1,600

1,600

1,600

1,600

1,600

2,100

2,100

2,100

500

500

500

4,200

4,200

4,200

1,600

1,600

1,600

2,100

2,100

2,100

1,600

1,600

1,600

4,200

4,200

3000*

14,230

390

1,400

1,200

1,400

2,100

2,100

4,200

3,700

19,530

390

1,400

1,200

1,400

2,100

2,100

4,200

5,800

3,000

26,730

390

1,400

1,200

1,400

2,100

2,100

4,200

4,200

4,200

21,190

260

260

500

4,200

1,000

3,000

4,200

1,000

2,500

3,000

4,200

4,200

4,200

15,600

3,000

4,200

4,200

4,200

32,520

130

1,000

2,000

500

4,200

4,200

12,030

1,000

260

260

2,100

2,100

30

6,490

260

260

500

4,200

1,000

6,300

12,790

260

260

500

4,200

1,000

3,000

4,200

1,000

2,500

4,200

4,200

8,400

3,000

4,200

1,000

2,500

8,720

130

1,000

2,000

500

8,200

16,920

130

1,000

2,000

500

4,200

7,830

1,000

260

260

2,100

2,100

4,200

4,200

3,630

1,000

260

260

2,100

2,100

4,200

4,200

Capital Goods | Transmission

Exhibit 33:

Inter-regional links at the end of 12th and 13th Plans

East – North (MW)

Narendra - Kolhapur 765kV D/c (ch at 400kV)

Wardha - Nizamabad 765kV D/c line

Raigarh - Pugalur +/- 800kV, 6000 Bi-pole

Warora Pool - Warangal 765kV D/c line

Sub-total

EAST- NORTH EAST

Birpara-Salakati 220kV D/c

260

Siliguri - Bongaigaon 400 kV D/c

1,000

Siliguri - Bongaigaon 400 kV D/c (Quad) line

Sub-total

1,260

NORTH EAST-NORTH

Biswanath Chariali - Agra +/- 800 kV, 3000 MW HVDC Bi-pole

LILO of Biswanath Chariali - Agra +/- 800 kV, 3000 MW HVDC Bi-pole at new pooling station

in Alipurduar and addition of second 3000 MW module

Rangia/Rowta – Gurudaspur +800kV, 6000/6500 MW HVDC bipole with 3000MW terminal

Capacity

Sub-total

Total

40,050

Balance

End of During End of

Present by 12th

12th Plan 13th plan 13th plan

Plan

(MW)

(MW)

(MW)

(MW)

(MW)

2,200

2,200

2,200

4,200

4,200

6,000

6,000

4,200

4,200

5,720

2,200

7,920

14,400 22,320

260

1,000

1,600

2,860

3,000

3,000

3,000

6,000

32,200

6,000

73,850

3,000

54,400

260

1,000

1,600

2,860

3,000

3,000

3,000

9,000

126,650

1,600

1,600

3,000

3,000

-

Source: CEA

Exhibit 34:

Normative spending in various segments of the power sector

POWER SECTOR

Generation 40%

Transmission 20%

Distribution 40%

Trans Line 60%

Sub-station 40%

Tower pkg. 60%

Transformers 50%

Conductors 25%

Others 50%

Others 15%

Source: Company, MOSL

February 2016

31

Capital Goods | Transmission

Exhibit 35:

Ownership-wise break-up of installed capacity (Jan, 15)

Central, 26

Private, 40

State, 35

Source: CEA, MOSL

Exhibit 36:

2021-22 Load generation balance report

Summer Peak

Region wise

NR

WR

SR

ER

NER

Bhutan

Bangladesh

Pakistan

All India

Region wise

NR

WR

SR

ER

NER

Bhutan

Bangladesh

Pakistan

All India

288,400 (61%)

290,000 (62%)

Dispatch (% of IC)

59,800 (59%)

97,900 (66%)

62,900 (53%)

5,800 (75%)

6,700 (46%)

3,100 (47%)

Dispatch (% of IC)

66,000 (65%)

93,200 (63%)

65,000 (55%)

53,800 (69%)

8,000 (55%)

4,000 (61%)

Demand

86,500

81,700

80,500

36,000

4,100

0

1,000

200

290,000

Winter Peak

Demand

82,000

86,000

82,000

33,300

3,900

0

1,000

200

288,400

Sur(+) / Def(-)

-22,200

11,900

-19,100

24,700

2,800

3,100

-1,000

-200

0

208,000 (44%)

Dispatch (% of IC)

40,000 (39%)

75,900 (51%)

45,000 (38%)

45,000 (58%)

1,500 (10%)

600 (9%)

Sur(+) / Def(-)

-20,500

11,500

-15,500

17,800

3,900

4,000

-1,000

-200

0

273,800(58%)

Dispatch (% of IC)

64,500 (63%)

79,500 (53%)

57,500 (48%)

56,800 (73%)

10,000 (68%)

5,500 (83%)

Monsoon Peak

Demand

83,000

77,500

74,000

34,200

3,900

0

1,000

200

273,800

Winter Off-Peak

Demand

61,000

60,000

58,000

25,200

2,900

0

700

200

208,000

Sur(+) /Def(-)

-21,000

15,900

-13,000

19,800

-1,400

600

-700

-200

0

Sur(+) /Def(-)

-18,500

2,000

-16,500

22,600

6,100

5,500

-1,000

-200

0

February 2016

32

Capital Goods | Transmission

Companies

BSE Sensex: 23,192

S&P CNX: 7,048

Companies

ABB

Alstom T&D India

Crompton Greaves

KEC International

Larsen & Toubro

34

39

48

53

58

February 2016BSE Se

February 2016

33

February 2016

Update

| Sector: Capital Goods

ABB India

Neutral

BSE SENSEX

23,192

S&P CNX

7,048

CMP: INR1,101

TP: INR1,380 (+25)

Well geared for a recovery; valuations expensive

Stock Info

Bloomberg

Equity Shares (m)

52-Week Range (INR)

1, 6, 12 Rel. Per (%)

M.Cap. (INR b)

M.Cap. (USD b)

Avg Val ( INR m)

Free float (%)

ABB IN

211.9

1,525/963

14 /0 /-3

233.3

3.4

92

25.0

Reorientation toward products business

Products business revenue increased from INR42b in CY09 to INR55b in CY15. The

increase was driven by introduction of products like solar inverters, LV products,

wind generators, motors and switchgears and is commendable—given the

constrained investment climate. ABB is strongly positioned in several macro

themes like i) renewables (3GW capacity for wind generators)/solar inverters (5%

of order book), ii) railways (with converters, turbochargers, electrification, etc.; 3%

of revenue) and iii) mining (motors, electrification, automation).

Project business profitability expected to revive

Reorientation of projects strategy, with focus on orders entailing higher value-

added pull-through for products, better risk profiling (including contingencies) and

cash over revenue. Thus, power systems margins should enter a new target range

of 8%-9% (v/s ~6.5% in CY15). ABB has significant spare capacity in the business

and, thus, could be an important beneficiary—given the operating leverage.

Margin expansion led by focused effort in localization through ‘In Country, For

Country’ initiative

Gross margin at 35% expanded to near decadal-high levels CY15, led by focused

localization efforts and supported by product-mix change and favorable currency.

RM costs declined from peak levels of 75% in CY10 to 65% in CY15, supporting

margin despite muted revenue CAGR of 5% over the same period. ABB invested

INR10b over CY07-14 in greenfield capacity, leading to near trebling of gross fixed

assets. ABB has commissioned factories in LV products/discrete automation/GIS/

distribution transformers/motors, etc., which led to poor fixed cost absorption. We

believe that product margin will rebound as the operating leverage kicks in. As part

of the ‘In Country, For Country’ initiative, local product development is an

important priority.

Increased focus on exports and service portfolio: key building block for improved

profitability:

Exports increased from INR5b in 2010 to ~INR10b in 2015.

Contribution of service revenue increased to 11% of sales in CY15. Margin on

exports is better than domestic and service has high double-digit margin. ABB is

exploring new markets like Africa and Myanmar.

Valuation and rating

ABB could be one of the important beneficiaries, given the increased share of

products (~65% of revenue)—which are largely beneficiaries in ‘early to mid-cycle’.

ABB is also exposed to several important trends. Current earnings are impacted by

legacy projects and negative operating leverage in products; thus, not a reflection

of long-term potential. Maintain

Neutral.

Financials Snapshot (INR b)

Y/E Dec

2015 2016E 2017E

Net Sales

81.4

84.8

97.6

EBITDA

7.5

9.3

10.9

Adj PAT

3.0

4.5

5.5

Adj EPS (INR)

15.8

21.1

25.8

EPS Gr (%)

22.8

34.0

22.2

146.

168.

193.

BV/Sh (INR)

RoE (%)

10.7

12.6

13.3

RoCE (%)

10.3

13.6

14.3

P/E (x)

69.9

52.2

42.7

P/BV (x)

7.5

6.6

5.7

Estimate change

TP change

Rating change

Shareholding pattern (%)

As On

Promoter

DII

FII

Others

Dec-15 Sep-15 Dec-14

75.0

12.4

4.4

8.3

75.0

12.5

4.6

7.9

75.0

12.2

4.8

8.0

FII Includes depository receipts

Stock Performance (1-year)

February 2016

34

ABB India

Exhibit 1: Revenue growth to pick up with improvement in

execution of projects in hand

Exhibit 2: Product revenues have increased on low project

orders (INR b)

Source: MOSL, Company

Source: MOSL, Company

Exhibit 3: Dedicated export oriented factories has helped to

ramp up the exports

Exhibit 4: FG imports have declined led by focus on

indigenization

Source: MOSL, Company

Source: MOSL, Company

Exhibit 5: Order inflows to pick up led by strong T&D,

renewables and rail capex momentum

Exhibit 6: Reorientation towards products business and

introduction of new products has helped to ramp up orders

from products segment

Source: MOSL, Company

Source: MOSL, Company

February 2016

35

ABB India

Exhibit 7:

Key

operation metrics

Year ended

Revenues (INR m)

LV Products

Discrete Automation & Motion

Process automation

Power products

Power systems

Gross Segmental Sales

Revenue Growth (% YoY)

LV Products

Discrete Automation & Motion

Process automation

Power products

Power systems

Revenue Growth

EBIT Margins (%)

LV Products

Discrete Automation & Motion

Process automation

Power products

Power systems

Costs, % of Revenues

Material Costs

Contribution Margins, %

Staff Costs

Other Expenses

EBIDTA %

Products (% of Revenues)

Fixed Assets Turn (x)

NWC (Days)

EPS (INR/sh)

% YoY

PER (x)

2010

4,486

15,929

11,886

18,155

18,267

68,722

2011

5,399

17,993

13,219

20,008

23,624

80,243

2012

6,174

17,753

13,566

20,853

22,422

80,767

2013

6,769

18,237

12,480

21,304

23,851

82,640

2014

7,373

18,986

12,450

23,255

21,554

83,617

2015E

8,006

20,624

12,503

25,992

18,707

85,832

2016E

8,068

24,796

12,503

26,125

17,979

89,472

2017E

9,279

30,994

12,702

30,931

19,110

103,016

17.3%

13.2%

-1.8%

-8.9%

6.3%

1.3%

20.4%

13.0%

11.2%

10.2%

29.3%

16.8%

14.4%

-1.3%

2.6%

4.2%

-5.1%

0.7%

9.6%

2.7%

-8.0%

2.2%

6.4%

2.3%

8.9%

4.1%

-0.2%

9.2%

-9.6%

1.2%

8.6%

8.6%

0.4%

11.8%

-13.2%

2.6%

0.8%

20.2%

0.0%

0.5%

-3.9%

4.2%

15.0%

25.0%

1.6%

18.4%

6.3%

15.1%

0.4%

8.3%

6.9%

4.5%

-0.6%

6.3%

11.5%

2.9%

5.0%

0.0%

6.4%

11.0%

-1.1%

6.6%

2.9%

3.7%

6.9%

5.7%

8.0%

3.9%

5.4%

6.8%

8.0%

7.9%

5.3%

9.1%

8.2%

10.1%

9.1%

6.5%

10.1%

9.2%

10.1%

10.6%

8.0%

10.1%

9.2%

10.1%

11.0%

8.0%

75.5%

24.5%

7.7%

12.6%

4.2%

54.1%

6.3

46.8

12.2

-38.2%

152.8

72.4%

27.6%

7.9%

13.4%

6.3%

55.4%

6.3

71.2

7.5

65.6%

92.3

71.7%

28.3%

8.2%

13.7%

6.4%

56.0%

5.5

71.8

12.4

-23.6%

120.7

69.9%

30.1%

8.8%

13.6%

7.7%

59.3%

5.5

71.7

9.5

35.0%

89.5

67.8%

32.2%

9.1%

13.8%

9.3%

63.6%

5.5

74.1

12.8

22.8%

72.9

65.1%

34.9%

9.2%

14.6%

11.1%

65.9%

5.6

75.2

15.8

34.0%

54.4

64.5%

35.5%

8.7%

15.5%

11.3%

69.1%

6.5

78.5

21.1

22.2%

44.5

65.2%

34.8%

8.8%

14.7%

11.3%

68.1%

7.4

78.5

25.8

14.3%

38.9

February 2016

36

ABB India

Financials and valuations

Income Statement

Y/E December

Net Sales

Change (%)

Raw Materials

Staff Cost

Other Mfg. Expenses

Selling Expenses

Admin. & Other Exp.

EBITDA

% of Net Sales

Depreciation

Interest

Other Income

Extra-ordinary Items (net)

PBT

Tax

Rate (%)

PAT

Adjusted PAT

Change (%)

2011

73,703

15.9

53,954

5,868

3,703

1,099

6,753

2,325

3.2

796

307

415

253

1,890

832

44.0

1,058

1,593

151.9

2012

75,650

2.6

54,278

6,196

4,181

1,086

5,191

4,718

6.2

941

432

-20

-1,263

2,062

688

33.4

1,374

2,637

65.6

2013

77,218

2.1

53,985

6,771

4,363

1,044

6,110

4,945

6.4

1,033

1,011

70

-223

3,194

956

29.9

2,238

2,015

-23.6

2014

77,333

0.1

52,429

7,052

4,489

1,133

6,239

5,991

7.7

1,128

1,050

173

-435

3,552

1,267

35.7

2,285

2,719

35.0

2015

81,403

5.3

53,000

7,499

4,904

1,174

7,361

7,465

9.2

1,598

912

130

-340

4,746

1,747

36.8

2,999

3,339

22.8

2016E

84,834

4.2

54,713

7,385

5,128

1,226

7,068

9,313

11.0

1,642

1,379

99

0

6,390

1,917

30.0

4,473

4,473

34.0

(INR Million)

2017E

97,604

15.1

63,646

8,552

5,811

1,413

7,287

10,894

11.2

1,784

1,399

99

0

7,810

2,343

30.0

5,467

5,467

22.2

Balance Sheet

Y/E December

Share Capital

Reserves

Net Worth

Loans

Net Deffered Tax Liability

Capital Employed

Gross Fixed Assets

Less: Depreciation

Net Fixed Assets

Capital WIP

Investments

Curr. Assets

Inventory

Debtors

Cash & Bank Balance

Loans & Advances

Other current Assets

Current Liab. & Prov.

Creditors

Other Liabilities

Provisions

Net Current Assets

Application of Funds

E: MOSL Estimates

2011

424

24,921

25,345

0

-224

25,121

14,619

2,935

11,684

839

507

49,600

9,255

30,825

2,644

3,667

3,210

37,509

18,649

16,530

2,331

12,091

25,121

2012

424

25,557

25,981

3,277

-148

29,109

15,856

3,783

12,073

1,170

525

50,784

9,204

32,644

767

4,585

3,585

35,443

19,033

13,946

2,465

15,341

29,109

2013

424

26,352

26,776

6,243

-272

32,746

18,627

4,712

13,915

475

173

55,661

9,889

32,357

3,166

6,077

4,172

37,477

20,826

13,960

2,692

18,184

32,747

2014

424

27,696

28,120

3,756

-152

31,723

19,718

5,723

13,995

319

165

53,585

8,938

31,575

2,260

6,790

4,022

36,341

19,840

12,977

3,524

17,244

31,723

2015

424

30,695

31,119

6,758

-490

37,387

22,220

7,321

14,899

319

164

60,008

9,396

33,909

5,736

3,964

7,003

38,003

21,020

12,720

4,263

22,005

37,387

2016E

424

35,168

35,592

6,758

-490

41,860

24,134

8,963

15,171

319

163

65,440

9,816

35,425

8,959

6,882

4,359

39,233

20,647

14,457

4,129

26,207

41,860

(INR Million)

2017E

424

40,635

41,059

6,758

-490

47,327

25,857

10,747

15,110

319

180

76,043

11,308

40,810

10,976

7,928

5,021

44,325

23,785

15,782

4,757

31,719

47,327

February 2016

37

ABB India

Financials and valuations

Ratios

Y/E December

Basic (INR)

EPS

Growth

Cash EPS

Book Value

DPS

Payout (incl. Div.Tax)

Valuation (x)

P/E

Cash P/E

EV/EBITDA

EV/Sales

Price/Book Value

Dividend Yield (%)

Profitability Ratios (%)

RoE

RoCE

Turnover Ratios

Debtors (Days)

Inventory (Days)

Creditors. (Days)

Asset Turnover (x)

Leverage Ratio

Debt/Equity (x)

Cash Flow Statement

Y/E December

PBT before EO Items

Add : Depreciation

Interest

Less : Direct taxes paid

(Inc)/Dec in WC

CF from operations

(Inc)/Dec in FA

Free Cah Flow

(Pur)/Sale of Investments

CF from investments

(Inc)/Dec in Net Worth

(Inc)/Dec in Debt

Less : Interest Paid

Dividend Paid

CF from Fin. Activity

Inc/Dec of Cash

Add: Beginning Balance

Closing Balance

E: MOSL Estimates

2011

7.5

-38.2

11.3

119.6

3.0

39.9

2012

12.4

65.6

16.9

122.6

3.0

24.1

2013E

9.5

-23.6

14.4

126.4

3.0

31.8

2014

12.8

35.0

18.2

132.7

3.7

28.8

85.8

60.6

36.6

3.0

8.3

0.3

6.4

8.3

153

46

92

2.9

0.0

10.1

6.3

158

44

92

2.6

0.1

7.5

8.0

153

47

98

2.4

0.2

9.7

9.2

149

42

94

2.4

0.1

2015

15.8

22.8

23.3

146.8

3.7

23.5

69.9

47.3

31.7

2.9

7.5

0.3

10.7

10.3

152

42

94

2.2

0.2

2016E

21.1

34.0

28.9

168.0

7.2

34.3

52.2

38.1

24.4

2.7

6.6

0.7

12.6

13.6

152

42

89

2.0

0.2

2017E

25.8

22.2

34.2

193.8

8.9

34.3

42.7

32.2

18.7

2.3

5.7

0.8

13.3

14.3

153

42

89

2.1

0.2

(INR Million)

2017E

7,810

1,859

100

2,343

-3,495

3,756

-1,722

2,034

-17

-1,939

2,180

-297

100

2,180

-3,714

2,017

8,959

10,976

2011

2,425

795

307

832

467

2,855

-5,081

(2,226)

-339

-5,345

2

0

307

739

-737

-3,228

5,871

2,644

2012

3,325

941

432

688

-5,127

-1,549

-1,661

(3,210)

-18

-1,774

0

3,277

432

739

2,182

-1,877

2,644

767

2013

2,971

1,033

1,011

956

-444

2,604

-2,180

425

352

-1,815

-253

2,924

1,011

744

789

2,399

767

3,165

2014

3,986

1,128

1,050

1,267

34

3,881

-1,053

2,828

8

-1,134

-30

-2,490

1,050

911

-4,157

-906

3,165

2,260

2015

5,086

1,353

900

1,747

-1,285

3,652

-2,502

1,150

1

-2,039

911

-1,855

900

911

-4,537

3,476

2,260

5,736

2016E

6,390

1,712

200

1,917

-979

5,136

-1,914

3,222

1

-1,989

1,784

-371

200

1,784

-2,929

3,223

5,736

8,959

February 2016

38