JAYPEE BUSINESS SCHOOL

Project Report On

TATA

POWER

SUBMITTED BY Monika Yadav 09503857 B10

SUBMITTED TO Mr. Avneesh Makkar

CONTENTS
1. Executive Summary 2. Background 2.1 Corporate Vision 2.2 Mission 2.3 Values 2.4 Organization Environment 2.5 Location Of Power Plants 2.6 Corporate Social Responsibility

3. Facts 3.1 Awards And Recognitions 3.2 Pioneering Initiatives 3.3 Pioneers In Power 3.4 Company With Many Firsts 3.5 Highlights Of The Year 3.6 Key Figures 4. Swot Analysis And Competitors 5. Conclusion

1. Executive Summary
TATA POWER: Lighting up Lives!
Guided by Founder Mr. Jamshedji Tatas vision that clean, cheap & abundant power is one of the basic ingredients for the economic progress of a city, state or country, Tata Power commissioned Indias first power plant- the hydro-electric station- in Khopoli (72 MW) in 1915, the second hydro station one in Bhivpuri (75 MW) in 1919 and the 3rd one in Bhira (300 MW) in 1922. With these three hydro stations and the 1,430 MW (100 MW merchant) thermal power station in Trombay, Mumbai; a 475 MW power station near Jamshedpur in Jharkhand and a 87 MW thermal power plant in Belgaum, Tata Power is the largest integrated private power company in India and is the most trustworthy power supplier to Mumbai. Recognised as India's largest integrated Electric Power Utility in private sector with a reputation for reliability, built up over nearly eight decades. Tata Power has an installed generation capacity of 6900MW. The Thermal Power stations of the company are located at Trombay in Mumbai, Jojobera in Jamshedpur and Belgaum in Karnataka. The Hydro stations are located in Raigad district in Maharashtra and the Wind Farm in Ahmednagar. A correct combination of hydel and thermal enables the company to supply power at a lower tariff to customers. It incurs low T&D losses due efficient management of the network. With its track record of technology leadership, project execution excellence, world class safety processes, customer care and driving green initiatives, Tata Power is poised for a multi-fold growth and committed to 'lighting up lives' for generations to come. The name of TATA says it all. It encompasses the lowest common Tata denominator the way others see the Tata Group.

Trust Acceptability Transparency Accountability

2

2. Background
Driven By Growth - Fuelled by Power
The core business of Tata Power Company is to generate, transmit and distribute electricity. The Company operates in two business segments: Power and Other. The Power segment is engaged in generation, transmission and distribution of electricity. The other segment includes electronic equipment, broadband services, project consultancy and oil exploration. The Thermal Power stations of the company are located at Trombay in Mumbai, Jojobera in Jamshedpur, Gulbarga and Belgaum in Karnataka. The Hydro stations are located in Raigad in Maharashtra and the Wind Farm in Ahmednagar. Tata Power is Indias number one private power company with net revenues of Rs.4239.08 Crores for the fiscal year ended September 31, 2011. Led by a powerful vision, Tata Power pioneered the generation of electricity in India. Mumbai Power is Tata Power. With highly reliable power supply and prompt service, Mumbai city enjoys the reputation of having the best power supply in India. A substantial quantum of power is supplied to the metros railway network, refineries, ports, BEST and BSES. Due to its unique Islanding system, Mumbai has been insulated to a large extent from electrical disturbances in the grid. It has now successfully served the Mumbai consumers for over nine decades and has spread its footprints across the nation. Apart from Mumbai, the company has generation capacities in Jojobera, Jharkhand and Karnataka.

2.1 Corporate Vision

To be an excellent and efficient Organization Excellence is to be made a way of life. Each one of us should sincerely believe that we can do better tomorrow than what we do today. To be a significant player in the national power sector Tata Power want to grow in spite of the current industry structure, growth will be both in generation & distribution. To participate in adjacent infrastructure business that provide opportunities for growth Tata Power doesnt want to wait forever for opportunities in the power sector. They want to avail and grab other opportunities in related infrastructure business. To be the best in the Tata group

This is a repeat of sorts of the first point. However, it is included again for reemphasis and to have a definite milestone. Tata Power want to cross the 600 score mark in the TBEM evaluation this year.

To enjoy the journey with all our stakeholders.

2.2 Mission
Improving the quality of life.

2.3 Values

Result oriented with professional work culture Abide by Tata code of conduct Earn trust through fair business practices with all stakeholders Growth balanced with environmental protection and enrichment Corporate citizenship Customer driven

2.4 Organizational Environment

TPCs business is broadly divided into four areas, power business in Mumbai area, power business as CPP / IPP, power sector related businesses such as PSD, power trading through TPTC and other businesses such as SED. Power business contributes to approximately 95% of TPCs operating income. Mumbai area contributes to 86% of the power business revenues and rest is through CPP / IPP operations and power sales to the SEBs / traders.

Power Business - Mumbai Area (MA) Generation, transmission, bulk and retail distribution of power in the city of Mumbai. Power Business CPP / IPP Captive / Independent Power Producer at Jojobera in Jharkhand and Belgaum in Karnataka. Wadi unit, which was CPP for ACC, was sold off to ACC after Q1 operations in FY05. Power Business Merchant power / trading TPC had initiated power sales to SEBs for the past two years. From its capacities in Mumbai and Jojobera sales were effected to MSEB, MPEB, RSEB and DVC directly / through TPTC and Tata Steel. Power sector related business Power Systems Division at Delhi, executing EPC contracts for power transmission infrastructure projects in India and abroad

2.5 Location For Power Plants

With operations in the power sector for nearly a century, Tata power is the oldest private Power Company in India. TPCs range of operations include power generation, 18 transmission within the area of operations, distribution to bulk and retail customers and supply of captive power to customers. TPCs business is broadly divided into four areas: 1. Power supply business in Mumbai area 2. Power supply business as captive power producer (CPP) and independent Power producer 3. Power sector related business such as power systems divisions (PSD) 4. Other business such as broadband division (BB) and strategic Electronic Divisions (for defense applications) Power business contributes to approximately 98% of TPCs operating income. Mumbai area contributes to 80% of the power business revenues and the rest is through CPP/ IPP operations.

2.6 Corporate Social Responsibility

Tata Power is committed to setting high standards in its pursuit of social responsibility and remaining sensitive to the issues of resource conservation, environment protection and enrichment and developing local communities in its areas of operations. The company has a simple philosophy that guides its activities in these matters "Giving back is a means towards going ahead. It is our firm belief that progress stems from giving back manifold to the communities and reflects in our widespread programmes on biodiversity conservation, forestation, phisiculture, family planning, health services, primary and secondary education and many more. All of these have made inroads into the tiny hamlets and tribal regions of our hydro catchments areas and its our endeavour to light up these dark and narrow streets to new dawns.

3. Facts
3.1 Awards And Recognitions

Tata Power has been ranked No. 38 in India's Best Companies to work study done by Great Place to work institute. Tata Power was conferred two award titles by Platts among top 250 Global Energy Companies. It was given overall ranking of number 42 in Asia and was recognized as 4th Fastest Growing Company in Asia. Tata Power was bestowed the prestigious Vasundhara Award in the industry category towards protection of environment in the State of Maharashtra by Maharashtra Pollution Control Board. Tata Power Energy Club, Tata Powers nationwide energy conservation movement led by school children, has been bestowed the Most Innovative Campaign award at USAs The Energy Dailys 2010 Leadership Awards. Tata Power Energy Club was awarded GOLD in Environmental Communication category by Association of Business Communicators of India. Tata Power was conferred the prestigious BML Munjal Award for Excellence in Learning & Development for the year 2011 in Private sector category. Trombay Thermal Power Station has bagged the prestigious Greentech Safety Award 2011 in the gold category (in thermal power sector) for outstanding achievement in Safety Management. Jojobera Thermal Power Station was awarded the Shrestha Suraksha Purashkar (Silver trophy and certificate) by National Safety Council under the NSCI Safety Awards scheme. Tata Power Strategic Electronics Division team was awarded the Frost & Sullivans Competitive Leadership Award for successfully bidding for the Indian Air Force project involving the upgradation of 30 airfields. Tata Power Energy Club ranked 2nd among 22 participants in Earth Care category for Siemens Ecovative Award 2010. The Company received Best Performer in the Power Industry at the Financial Express Emergent Ventures India Green Business Leadership Awards
6

The Company received Certificate of Merit - Global CSR Awards 2010. Tata Power was awarded "Best Fast Track Completed Power Transmission Projects award (Timely Completion of 2 Transmission Projects)" at the 5th India Power Awards 2012, organised by The Council of Power Utilities at New Delhi ( November 2012) TATA POWER WINS THREE PRESTIGIOUS AWARDS AT THE 52nd ASSOCIATION OF BUSINESS COMMUNICATORS AWARDS NITE 2012 (October 2012) : Gold for Social Responsibility Communication for Club Enerji Silver for Wall Calendar design 2011-12 Bronze in Multi Media CD ROM Interactive presentation on Resource Conservation for Club Enerji Tata Power was conferred with IPPAI (Independent Power Producers Association of India) Award in the category Best Wind Power Producer on 24th August 2012.

Tata Power Club Enerji has been recognized in the 2012 International Business Awards with Gold Stevie Award for being the Best Marketing Campaign of the Year 2012 - Energy category. August 2012.

Tata Power was conferred with Powerline Award in the category Best Performing Renewable IPP.

Tata Power has been selected as the winner of the Infrastructure Excellence Awards 2012 in the Main Awards Category - Energy & Power for the project Ultra Mega Power Project, Mundra, and Gujarat.

3.2 Pioneering Initiatives

Apart from being pioneers in Power production in the private sector, Tata Power has many firsts to its credit: First to bring UMPP in India (at Mundra, Gujarat) based on super- critical technology and unit size of 800 MW each. First 150 MW thermal unit in the country First 500 MW thermal unit in the country. First to Commission Gas Insulated Switchgear 220 KV and 110 KV. Touch screen-based Distributed Digital Control and Energy Management Systems. Computerised Grid Control and Energy Management Systems. 220 kV Transmission Lines in Four-Circuit Towers. 220 kV Cable Transmission Network Flue Gas De-sulphurisation Plant using sea water. First 275 meter tall chimney for Unit No.6. 500 MW power plant. First Operational Pumped Storage Unit in the country of 150 MW capacity. First to install Fly Ash Aggregate Plant to convert waste product (fly ash) into a useful building material. Training Simulators for 150 MW, 500 MW Thermal Power Plants and High Voltage Switchyard Operations. First to introduce SCADA and Fibre Optic Ground Wire Communication. Tata Powers Load Despatch Center is the First ever Load Despatch Center in India to have gotten ISO Certification (11 August 2004)

3.3 Pioneers In Power

Largest, Most Reliable and Efficient Private Sector Energy Major Tata Power, erstwhile known as Tata Electric, pioneered the generation of electricity in India nine decades ago. Today, it is the country's largest private power utility, established as a licensee in Mumbai and with ambitious expansion plans from being essentially Mumbaicentric to a major national player, not only in the fields of Power but also in Energy and Broadband Communication. Tata Power is the one company with presence in all aspects of Power, be it Thermal, Hydro, Solar, Wind Energy, Transmission & Distribution Leader in Total Power Management Tata Power, the pioneer today, also enjoys the privilege of being the leader: Licensed installed generation capacity of 1798 MW for Mumbai - Largest by any Licensee Indias largest power utility - Accounts for 52% of the total generating capacity of the private sector as a licensee Strong track record of prudent management and growth First ever Load Despatch Center in India to have gotten ISO Certification (11 August 2004)

3.4 Tata Power: A Company With Many Firsts

First Hydro Electric power plant in India First 500 MW thermal unit First to commission GIS mechanism First Flue Gas De-Sulphurisation plant
8

 First to introduce SCADA and Fibre Optic ground wire communication First Pumped Storage Unit in India Successful Delhi distribution Tala transmission line (1,300 Kms)

3.5 Highlights Of The Year

Consolidated Revenue stood at ` 19,450.76 crores. Consolidated Net Profit up by 5% at ` 2,059.60 crores. Annual Sales at 16,060 Million Units (MUs). Consumer base in Mumbai increased and crossed 1,50,000. New 120 MW unit commissioned at Jojobera Thermal Power Station in Eastern India. 3 MW, PV based, grid connected solar power plant commissioned at Mulshi in Maharashtra. Power Purchase Agreement (PPA) signed and construction underway for the 25 MW Solar PV Project at Mithapur in Gujarat. Won a bid for the 236 MW Dugar Hydro Electric Project in Himachal Pradesh along with SN Power, Norway. Leading private wind generator with an installed capacity of 273 MW. Won a bid for 240 MW Sorik Marapi geothermal project in Indonesia in a Consortium with Origin Energy, Australia and PT Supraco, Indonesia.

In a free enterprise, the community is not just another stakeholder in business but it is in fact the very purpose of its existence.

-- J N Tata

3.6 Key Figures

SO2 Emissions At Trombay Are Among The Lowest In The World

IFC

Denmark

USA

Canada

TPC, Trombay

SO2 emissions Metric tonnes per day

TPCs Performance Is Reflected In Strong Financial Results

EBITDA PAT

2008

2009

2010

2011

2012

Profits in US$ million

Operating margins

10

Percent

2008 2012

2009

2010

2011

SUSTAINED EPS

Percent

2008 2012

2009

2010

2011

Opportunity To Improve Plant Load Factor

Plant load factor at Trombay %

11

2008 2011 2012

2009

2010

4. SWOT analysis and competitors

Tata Power Parent Company Category Sector Tagline/ Slogan USP Tata Group Power Energy Lighting up Lives! Indias Largest Integrated Private Power Utility STP Segment Target Group Positioning Retail customers in metros, Refineries, Ports etc Residential areas and Industries Reliable Service with superior customer care SWOT Analysis Strength 1. Can leverage on the Tata brand which signifies Trust 2. Capable of expansion since it has large reserves and low Debt-Equity Ratio 3. Access to newer technologies 4. Tata Power uses various ways of generating power i.e. thermal, hydro, wind, solar energies etc. 5.
12

Malaysia, Saudia Arabia, Kuwait, Singapore, Cyprus etc are some places where Tata Power has made its presence felt 6. Despite having a comparitively small employee workforce of 3000-odd employees, the skills of each employee is of the highest level Weakness 1.Limited Market share due to intense competition 2.Limited presence in South India which is a lucrative market having IT hubs and no presence in Central India 1.Increasing demand for power 2.Non-conventional sources of power 3.Expansion into third world countries and global expansion 1. Fluctuating International prices of coal 2.Changes in International policies regarding import of coal and oil 3. Government policies and regulations Competition 1.Reliance Power 2.Adani Power 3.NTPC

Opportunity

Threats

Competitors

Significant Efforts Being Made To Achieve Cost Competitive Operations

TBEM = Tata Business Excellence Model

The Growth drivers are:

13

Seeking increase in capacity through New projects, Domestic & International acquisition and Expansion Seeking backward integration by acquiring Captive Coal Berths Growth in Other Businesses

The drivers to Defend Current Business are:

Thru 3 SCR Other initiatives

The Organizational Transformation drivers are:

HR Initiatives TBEM Risk Management

Three Pronged Approach To Sustain Position As Indias #1 Private Power Company Develop portfolio of generation assets

Flexible fuel strategy as not locked into a single fuel: a multi-fuel strategy to deliver lowest cost power in key markets Invest in a portfolio of assets lock in strategic markets/sources, create options in other markets

Actively grow distribution footprint

Expanding portfolio of customers (bulk, residential) Partner with select state governments

Building world class team

Multiple capabilities to grow at rapid pace

Operational excellence Distribution skills Regulatory management Business development and project execution skills

14

5. Conclusion
Having set up one of the first hydro power stations in India nine decades ago, Tata Power is Indias largest integrated power company. With an immediate future brimming with possibilities, the Company explores increasingly weightier ambitions to keep fuelling its multi-fold growth. Since inception, Tata Power has been a Pioneer in Technology and has contributed to the Indian Power Sector through its technological innovations With its track record of technology leadership, project execution excellence, world class safety processes, customer care and driving green initiatives, Tata Power is poised for a multi-fold growth and committed to 'lighting up lives' for generations to come.

15