Indian Utilities - Power Trading Market slips to 3 year low - Motilal Oswal

INDIAN UTILITIES: Power trading market slips to near three-year low; Volumes shift to power exchange on price differential

As per CERC's Market Monitoring Cell Report (December 2010), power trading volumes for December 2010 stood at 6.2BUs, up 4.2% YoY.

Weighted average prices in December were Rs3.2/unit, down from Rs6.7/unit in April. The market size was down 19% YoY.

The contribution of bilateral trade to total trading declined to 45% from 50-54% on average in the past 22 months.

Power exchange contributed 20% of the power traded, and the share increased from ~9% in FY10.

Prices in bilateral markets declined to Rs4.0/unit in 3QFY11 against an average of Rs5.8/unit in 1QFY11 and Rs4.9/unit in 2QFY11.

Source : Equity Bulls

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