PTC India Limited (PTC) Earnings Call Transcript & Summary

Thank you very much. Good evening, ladies and gentlemen. On behalf of the management of PTC, I welcome you all to the conference call for the quarter 1 results of the company for financial year 2021. Today, along with me in the call are my 2 whole-time directors, Dr. Rajib Mishra, who is the Director of Marketing and Business Development; Dr. Ajit Kumar, who is the Director Commercial and Director Operations; and then we have the CFO, Mr. Pankaj Goel; and the Corporate Communications team led by Rajiv Malhotra, who is our Executive Director and CRO; and Anand Kumar, whom all of you know. So what a quarter it was, and that's what I can say. This type of quarter, I mean, once in a century type of quarter, which was very tough, not only for the economy and the country, on all the reportable numbers and intermittent shift in priorities of the state also which we saw. We wanted to create a conducive environment from livelihood to life first and then slowly and slowly in the second half of the quarter, it was a reverse, vice versa, that from life, how do we go back to the livelihood. As we have seen that electricity being one of the essentials -- basic nature of essential goods, the impact was not so much as seen by other parts of the economy. But still, energy fell. In the entire quarter, energy fall was about 15% vis-à-vis corresponding quarter of the last year. And in this environment, PTC could still manage its business to close quarter 1 at 18.9 billion units, that is, around 2.3% down from the corresponding quarter of the last year. It's very important for me to highlight that the business volumes during the quarter are, in part, reflective of trends in the demand during the lockdown period and subsequent periods of gradual opening up starting mid-quarter. Second point, which I wanted to make, is that while demand for traded electricity was impacted heavily initially, in the month of April, the fall in our volumes were much more than the demand fall in the electricity. Gradual restoration of the economic activity saw a revival of demand to levels comparable to corresponding period last year. Now it's important to note here that demand for trading -- traded electricity does not only depend upon overall demand for electricity in the system. It is also dependent upon mismatches of demand and supply. During this quarter, there was a lot of flux, which we saw: first the complete lockdown, then its easing in parts, then obviously we saw states with good track record on COVID numbers getting or transiting into bad and vice versa also. And there was no predictable pattern to the buildup of electricity demand. Therefore, mismatches were very high. And that gave the reason -- that give an opportunity for trading of electricity. The fact that our volumes in the short term end have gained from the 1-day market suggests how the mismatches have been met by contingency plans and that -- et cetera. But still, the pattern needs to be watched for another quarter maybe before we -- one can make a significant prediction of trends. The flux during this period has yet again demonstrated our balanced business portfolio. And its resilience in the -- I mean in the company's history, this was the most stressful quarter, and we could manage it. And that's what -- it shows that our business portfolio, balanced business portfolio, which we have been always saying that more than 50% should be coming from long term and medium term, and it has really tested -- was really tested this time, and we came out of this quarter. As we saw, a sluggish short-term bilateral segment was offset by exchange rates and, more importantly, the medium and long-term trades. And this trend also suggests our sound market design principles. Now going forward, movement in broad economic indicators. The effective availability of liquidity to the discoms and, consequently, the demand for traded electricity needs to be watched for another quarter before we can predict a significant trend. Now very important to note down that positive results of the structural initiatives taken by Government of India in the wake of COVID-19 are now getting more and more visible. Still, we remain cautiously optimistic, and we believe that we are confident of consolidating our leadership position based on emerging opportunities in the sector during the coming quarters. What is -- what I would like to also state that there was a good pickup of cross-border trade during the quarter compared to the previous year, and that has helped us in maintaining the margins also. One more thing which I want to say that with business and economy not fully -- still to fully report the growth, the discoms are going to find it difficult to keep themselves totally financially stable. Obviously, the liquidity infusion by PFC and REC is helping discoms to tide over liquidity issue in the short and medium run-up. But obviously, the wish for operational parameters to improve is the only way to make it sustainable in the long run. With this, I hand over the mic to my CFO, Mr. Pankaj Goel, who will take you through the numbers. Thank you.

Thank you, sir, and good afternoon all. Now I would take you through the financial -- stand-alone financial performance of PTC India Limited for the quarter June '20 vis-à-vis the last quarter, June '19. Volume has marginally decreased by 2% to 18.9 million units from 19.4 million units. Total operational income has decreased by 8% to INR 116 crores from INR 126 crores. Profit before tax has decreased by 5% to INR 91 crores from INR 96 crores. Profit after tax has increased by 8% to INR 68 crores from INR 63 crores. Total comprehensive income has also increased by 8% to INR 68 crores from INR 63 crores. Earnings per share for the quarter stood at INR 2.29 compared to INR 2.12 last year. Now I will also like to take you through the consolidated financial performance for the quarter. Volume has decreased by 2% to 19.1 million units from 19.5 million units. Profit before tax has increased by 2% (sic) [ 1.32 % ] to INR 142 crores from INR 140 crores. Profit after tax has increased by 7% to INR 100 crores from INR 93 crores. Total comprehensive income has also increased by 5% to INR 99 crores from INR 94 crores. Earnings per share for the quarter stood at INR 3.07 compared to INR 2.97. Thank you.

Now I think best will be to open the question-and-answer series, and we will try to cover it to the best of our ability. Thank you, moderator.

[Operator Instructions] The first question is from the line of Devansh Nigotia from SIMPL.

Sir, just a couple of questions. One is, can you just elaborate on the status of the upcoming exchange and early exchange that you're looking to float? And there were concerns that earlier we could hold only 5%, but then there is some response pending from our side, based on which it can go up to 26%. So what exactly are we there in this whole equation?

Yes. See, we had applied to CERC where a consortium working between PTC, Bombay Stock Exchange and ICICI Bank. And after a lot of hearings, in the end of July, CERC came out with an order that prima facie they are satisfied with the ability to do the -- to carry on the exchange activity, but they have asked us to bring the shareholding patterns as per Power Market Regulations, 2010. And they have given us 8 weeks' time. And I'm sure the company, which is operational, Pranurja, they are doing all the efforts. And hopefully, by September end, after getting the things -- today, the net worth got INR 25 crores or so. So by making it INR 50 crores, additional capital will also come, and they will go back to the CERC by the end of September. And let's wait for CERC to...

So sir, would it be right to say that based on existing regulations, we can have 5% shareholding? And the response is pending, based on which it can go up to 26%, I mean, if that's the right way to look at it?

See, what I can say at this point of time is that we will be abiding with whatever power market regulations permit. And it is -- let's go, and along the way, as and when anything happens, we'll certainly be speaking to you all. Today, the first thing is to satisfy the Power Market Regulations. Yes.

Okay. Okay. And sir, so like now that the pricing on -- it's market coupling, which is currently in draft, but let's say, if it comes operational, then pricing on all the exchanges will be same. So how do you really look at the competitive intensity going forward? In terms of, can we charge less than what the existing monopoly exchanges is charging to its customers? I mean do the regulations allow that? Or -- if you can just elaborate on...

Let me just say that these things can be answered only over a period of time because as we have stated earlier also that, let's say, CERC even gives us by September end or so go ahead also, final go ahead, it will be some time before we will be able to make it operational. It may take 6 months, 7 months, 8 months. So by the time the whole objective is to bring a competitive. That's what Electricity Act, 2003 is known for. It brings competition and that it'll be voluntary. That has been the ethos and the essence of the whole Electricity Act, 2003. So we are working as per that only.

The next question is from the line of Mohit Kumar from IDFC Securities.

Congratulations on good set of numbers in this tough environment. Sir, my first question is on the -- can you just throw some light on the receivables position right now? And how much cash we are holding? And given the fact that surcharge has declined significantly, are you holding a lot of cash at the end of June?

I'll ask the CFO to give an answer to this question. But I would like to lay down certain principles, which we -- see, when the -- suddenly the Prime Minister announced on 25th of March or so that from next day, India is going to be completely shut down, it created a lot of disturbance across the country. And we also sat together and worked out and we believed at that point of time that we are going to be very conservative in our cash management going forward starting from, I think, 27th or 28th of March, which were 3, 4 days of the last year and first quarter. So that was the basic principle. And we also saw, as we were going along the journey in the quarter, that our current receivables varied somewhere between 50% to 70%. So these 2 things were the fundamental principles. And surcharge, there is no shortfall of surcharge. As an improvement, what we reduced was rebate, which was a very conscious decision. In the initial one month, as I said, there was a lot of flux, no certainty. And PTC also started immediately working with Government of India and along with all the IPPs and central generating stations and Ministry of Power -- convincing the Ministry of Power that we have to think about infusing liquidity going forward in the next 2 to 3 months, which occupied most of our time at least at my level. And only when the Finance Minister, she came and she announced that Atmanirbhar, by that time, we knew that now that is something which is going to be certainly happening. It may take 2 months, 3 months timing, but that is something. And then we started changing our track again. So this was that the principle overall top-down view I have given. Now Pankaj will give you the details.

Yes, sir. As you were inquiring about our receivables position, so always we tell the net receivable position, means the debtors minus the creditors. So our net working capital at the end of this quarter was around INR 1,900 crores in comparison to March '20, when our net working capital was around INR 2,450 crores. So as CMD was already explaining you that because we have started conserving cash after the lockdown period, and we have waited for some time to see how the states are behaving because -- and as expected, in the month of April, they have released a very, very flattery amount, and accordingly, we are also managing our cash management. But from mid of May and June, then they have started releasing some money. And at the end of the June, a good amount of money we have received from UP and Rajasthan also. So that is why our cash position is very good at that point of time.

How much is the cash and net debt?

We were having a net borrowing of INR 59 crores at the end of June.

INR 59 crores. It has declined significantly. Okay. Do you think this will increase -- you'll increase the debt number, and you'll increase the working capital as we go forward?

No, no. Actually, the -- as you see that, as sir has already explained that, a lot of money has now come into the system after this release of INR 90,000 crores. And today also -- yes, we are receiving some money...

We have been receiving the money.

We have been receiving the money. So we don't see that the -- pro rata that debtors will be increasing or the creditors will be increasing.

Let me just explain here that you know, this is a position as on a particular date, as on 31st March, as we had explained, similarly, as on 30th June, but the position will keep fluctuating on a day-to-day basis.

Right. Sir, on the PTC Energy, can you just give us a revenue, EBITDA and PAT number? Secondly, where is the case with the tariff? Is it lying with the high court right now? Or is it with APERC? And what is the progress? And when do you expect it to be resolved completely?

As far as the quarter 1 numbers are concerned, there are 2 reasons for a slight decrease in the operational performance because of the wind availability during the period. There were some losses. And there was some loss because of the low offtake by Andhra Pradesh. Because the demand -- as you all know that the first quarter demand in all the southern states -- western and southern states was low because of the industrial demand. So they were not offtaking. 188 megawatt out of 288 megawatt is located in Andhra Pradesh. And there, the demand was low. So the operational performance was affected slightly because of that. We are trying to see something -- a better trend in this quarter. So this is as far as the offtake of the power is concerned. The second aspect you said about the issue related to the reduced tariff which we are getting from Andhra Pradesh, that is, INR 2.43 against INR 4.84. We have 2 cases simultaneously running, one at the high court and at the regulatory commission level also. But in all certainty, we have checked it with all the legal experts, and the PPAs are generally sacrosanct, and it cannot be reduced, but it is taking some time, and that's the reason why it is getting affected in our financial results.

Okay, sir. Can I have the revenue, EBITDA, PAT number for the PTC Energy for the quarter?

Yes. Yes. The revenue for this quarter was INR 77.83 crores and the PAT was INR 5.81 crores.

The next question is from the line of [ Gaurav Gupta ], who is an Individual Investor.

Sir, I have 2 questions. Basically, first, with respect to PTC Energy. I was referring on your website. There you have uploaded information related to PTC Financial as well on a quarter-on-quarter basis. But the same kind of information is missing related to PTC Energy. Don't you think so that on a quarter-on-quarter basis, considering the huge amount that we have invested as a company in PTC Energy, it makes a good corporate governance point of view that we upload that information as well?

Let Rajiv Malhotra and Anand, they're part of Corporate Communications. Rajiv Malhotra, can you react. And Anand -- any one of you.

Sir, our corporate presentation does carry the PAT number of PTC Energy Limited. However, when you require a detailed presentation, we will look for the regulatory requirement per se, and we'll float it on our website.

Sir, I think in the last couple of con calls as well, investors as well as analysts have requested that PTC Energy being a substantial -- it is a wholly owned subsidiary, and we have invested substantial amount as well. So specific information, just like PAT number you are mentioning in your presentation, right? But if you see your website itself, you have uploaded the financials for the PTC Financial. So on the similar line, if you can upload the financials for the PTC Energy as well, so that will make a good case for the investors and analysts to analyze what exactly is going on in PTC Energy as well.

Point taken. It's a good suggestion. We'll analyze it and do it accordingly. Thank you.

Yes. So second part is with respect to PTC Financial. We have floated one advertisement where we have invited bids for the divestment of our stake in PTC Financial. So any update on that part?

See what we had said that -- we had said that by 31st of July, we had called for interested parties to show their -- to give their expression of interest by signing the NDA. What I understand -- and we have appointed investment bankers also, IDFC Securities, who are doing the things. So we understand there is good response from a variety of people. So they are analyzing it. And once they come back to us, we'll get into the next phase.

Okay. With -- in continuation of this only, I was going through the last con call, and we categorically mentioned that our investment in PTC Energy and PTC Financial shall be considered as financial investments. Like earlier, PTC Financial was considered as a majorly owned subsidiary and PTC Energy as a wholly owned subsidiary. So in the similar lines, we have invested near about 5% in Teesta Urja as well. So any plan on divestment of that as well? Because I think there were a couple of news where Greenko has taken a substantial part of Teesta Urja in, I think, in the beginning of this particular calendar year.

As far as our understanding goes in Teesta Urja, Greenko has applied, and I think government of Sikkim has also given the go ahead, but the lenders have to give a go ahead. So all those activities are going on. And the Asian Genco, which was holding about 30% or so, that thing will get transferred to Greenko. So PTC and government of Sikkim, we will let these transactions take over because the company is doing well and company is running fully. So PTC in consultation with government of Sikkim will look at this option what we are saying. We'll certainly look at that option. And hopefully, in the -- as we are doing to our subsidiary companies as of now, we'll also be considering a monetization in the next 1 to 2 years' time. We'll consider that.

If you will allow last question from my side. In the new exchange for which we have applied, what is the amount that we have invested as on date?

It's INR 12.5 crores.

And any further investment we are envisaging over there?

No, no, I don't think so. No. Not required.

Not required.

Not required, as per regulations also.

The next question is from the line of Sarvesh Gupta from Maximal Capital.

Sir, first question is regarding PTC India Financial Services sale. So -- of course, we don't know when the sale will materialize, hopefully, by end of this year. But the amount that we will receive now -- again, we don't know the amount, but let's say, if we just consider the market cap also, we will be able to get INR 600 crores, INR 700 crores and maybe net of tax and everything, maybe INR 500 crores, INR 600 crores or much more than that, depending on the deal. So what will be the intended use of such a substantial amount of money that we will receive?

See, as we have been stating for the last 2 to 3 years' time, that capital allocation, et cetera, which we have been working on. And in the previous questions also we said that from an asset heavy this thing, we are trying to be becoming light asset. So whatever we'll require -- and our volumes are continuously increasing. It's just because of impact of corona, et cetera, certain things and economy is slowing down, but that is -- these are only things for a quarter or maybe 1 year, 2 years. But over a period of time, volumes are going to be increasing. So whatever we will be requiring for business, rest of the money, I can't say today because what will happen 9 months down the line or 10 months down the line, but at least we at a management level are very clear that there have been a lot of shareholders who have been really patient with us, and we have to -- we will keep taking the interest -- care of the shareholders' interest.

So you will give it out to the shareholders, is that...

I can't say. I will not like to comment upon that because it's too premature just now. As you rightly yourself are saying, you don't know how much, it may get INR 500 crores, it may get INR 1,500 crores. We don't know. So that's what I said, we'll have to wait and watch, and we'll be taking -- the management is very clear. But ultimately, there is a Board, there are shareholders. So we will be going back to each one of them with the concrete plans, et cetera. But one assurance, which I have given to the analysts as well as by shareholders for the last couple of years, is that we will not be getting into capital-heavy business.

Understood. And this exchange business that you are planning to enter, what could be the -- is there a limit to -- of investments that we can keep in mind as shareholders that...

These are as per Power Market Regulations...

From your side, is it INR 100 crores investment? Is it INR 200 crores...

No, no, no. We said 12.5 crores. I think my CFO in my earlier question, he has said that no further money will be given to them. It's not -- the exchanges are never this thing -- capital heavy this thing business, other than IT and platforms for software, which you have the OpEx model, CapEx model, whatever they want to follow. So there are various models, but it is not going to be this thing. So whatever money we had to give them, we have given them.

Okay. Okay. And then on the PTC Energy, because we have been saying since 2019 and earlier that we want to divest that. So what is the thought around that? Is there anything which is happening?

Yes, the thought is very clear. But as Dr. Mishra just explained a couple of minutes back that out of 290 megawatts, 188 megawatt or 190 megawatt is Andhra Pradesh, where because of certain reasons, there are -- matters are pending before the court. So -- and money, which we're also receiving actually. So they have got all the money from the 31st March they have received from Andhra Pradesh, which -- as a maximum. But it is a very, very small amount, that is, INR 2.44 against INR 4.70 or INR 4.80, whatever it is there. So we are very clear of our objectives, but obviously, we cannot force down anything. And we have been in the market. And as and when the market will allow us to divest it, we'll certainly look at that option. But in the meantime, we are running the company, we are running it well. And last time because initial 2-year period has gone over, so the O&M expenses, et cetera, which have really, really increased, which had -- one of the reasons for lesser profitability during the last quarter was also the O&M -- new O&M which has come. So the Managing Director is conceptually evolving these things, and they will work out their plans till the time it doesn't get divested.

Okay. And sir, on the stand-alone business, I think our run rate of PAT is around INR 300 crores, annualized. So is that given where things stand? Of course, we don't know how things may shape up in the future. But given how things are looking as of today, do we say -- can we say that if things were to continue at similar fashion, we would be able to achieve around INR 300 crores out of PAT in our core business of trading?

I will not be able to make a comment to this question. Every quarter, the results are there. You have seen the growth also, the growth of things for last 7 -- 6, 7, 8 years, which we have been giving. Beyond that, I will not be able to make a this thing. I'll not like to make a comment on that. It is for...

The next question is from the line of Aman Thadani from Consortium.

Sir, my question is regarding the market-based economic dispatch, which says that the 100% of the volumes will be traded through exchanges, even the long-term contracts. So will the role that PTC currently plays in the power market be redundant, as now the power generators and buyers can, like, directly find each other on the exchange for even the longer-term contracts?

I'll leave the main question to be answered by Dr. Mishra, but let me say that, as I said, the spirit of 2003 Electricity Act was always a voluntary market. So there is no compulsion to come through trader at that point of time also. So till the time any trader or any intermediary, not even a trader, whether you're a bank or a financial in NBFC or a trading company, until the time we don't keep adding value, you will have to keep adding value, creating new products, which we have been doing continuously. So that is a basic minimum for anyone to do anything. Now for the questions regarding, from tomorrow if the government wants -- see, tomorrow if they can shift everything there, I see a lot of challenges, but I'll leave it to Dr. Rajib Mishra, who is also closely associated with the Ministry of Power. He is a part of the task force, et cetera. So if he wants to give whatever limited comment he wants to give, please go ahead.

First of all, let me explain what market-based economic dispatch is because a little bit of confusion that market-based economic dispatch is going to replace the PPAs. It's not so. Market-based economic dispatch is a way of dispatching. Today, we are -- all the states are dispatching power through a merit order. They have PPAs, they stack all the PPAs and then based on the merit order of their variable cost, they dispatch. Market-based economic dispatch is, again, dispatching the merit order-based power on variable cost at a national level. Now the procurement of power is always done at the state level. And the dispatching is also done for the geographical boundaries within the state. Of course, all the states are interconnected with some transmission line, but the onus of power procurement and dispatching is with the state. Now market-based economic dispatch can be a noble idea to integrate the entire country and use all the PPAs together to get the economy of scale. Now this is at a stage where things are being getting evolved. But at no point people are discussing that PPAs will be disband and it will be replaced with a dispatch system where only the exchange will procure power to meet the requirements of the states. So at this point of time, we would like to restrict the discussion to the academic level because it will take a lot of time before market-based economic dispatch can be operationalized in the country. Even if it is operationalized, the conventional PPAs will be in place, and the states will be participating at a national level for the clearance of the dispatch by the exchanges. So I think we should not preempt so many things by saying that the market will be changed to a design where all the conventional ones will be replaced with a new dispatch model. We have to wait till finally it is getting implemented and the regulations and the orders are put in place.

Sure, sir. Sure, sir. And sir, my next question is, sir, regarding this only, but that how will our margins get impacted in the future if this regulation comes in? Because there is a margin which goes to the exchange and there's a margin which the traders charge?

So if the PPAs are already in place and then the power is being scheduled at the exchanges, it doesn't matter to the trader because the trader PPAs will be retained. Now these are, again, some of the assumptions which we are making. We have to wait till the final regulation comes because there are a lot of things which we have to discuss before the MBED can be put into place.

Sure, sir. Sure, sir. And sir, one question is regarding -- why -- it's a very basic question that why do the power producers engage in PPAs? Since the electricity costs keep on coming down. Why not just like procure it from the power exchange?

Very valid question. But for how much volume is the question. If you are talking about a total national requirement of around 190 gigawatt, whereas the exchange is only catering to a demand of 8,000 to 10,000 megawatt, you are only trying to find out the price at a distress situation. When there is no demand, and you are finding the prices have come down to a level which is very low. So it is not an indicative price of the entire set. It is a subset, which is not indicating the entire volume requirement. So we are preempting the price of power too much if we are saying that during the COVID period, the prices have come down to a level. So it's all demand and supply in exchanges, and it is not reflective of the true prices in the market at this point of time, specifically.

The next question is from the line of Rajesh Choudhury from Zenith.

My question is like what is the minimum value that you are looking from the sale of PTC Financial, as I understand like PTC India has invested close to INR 750 crores in PTC Financial over a period of time?

Thank you. There is -- that's what I'm saying. These things -- at present, it is too early for us to say anything on these accounts, but you'll have to wait for the next couple of months, maybe 3 months or 3 months or so, 3 to 4 months, and we'll come back with all the details.

Okay. And will it be a partial stake or a full stake?

All those structures, as on today, that's what I'm saying, you'll have to wait for a couple of months before we can say.

The next question is from the line of Rahul Modi from ICICI Securities.

Congratulations on a good set of numbers, sir. Just 2 questions I had. Sir, one, how has the progress of the Pilot I 2,500-megawatt been? And what is your view on the second pilot 2,500? How -- is there any movement on that?

The first one, we operationalized 1,900 megawatts, and that is going on. All of them are totally operationalized. For 2,500 megawatt, I will ask Director, Marketing, to give the feel or feedback.

As you all know, the Pilot II was -- the price discovery was done in the month of February. And the response initially we got from most of the states were very, very encouraging. But March was something which was unpredictable. Nobody knew what is going to happen, and so was the demand from the states. So we had a very good response, initial response, commitments also for a good offtake. And we were very -- pretty sure that we will be in a position to sign the PPA, PSA well within the stipulated period. But because of all these reasons, things are delayed. We are, of course, finding again the traction back, and we'll be in a position to inform you about the good news maybe in the next quarter.

Okay. Sir, just one thing. So price, there is no talk of renegotiation. Price -- it's just the timing.

Yes, yes. Price, it is already discovered. The quantum is discovered. The suppliers are already discovered and listed. And the potential buyers are also we have listed. It's only the question of their demand. Once they say -- feel that the demand has come, they will come back to us, and we'll be in a position to complete the process.

The next question is from the line of Abhishek Puri from Axis Capital.

Congrats on a good set of numbers. Sir, a couple of things. One, from the previous question that was asked, the medium-term PPA, we've heard from some of the market news that the PSA has been done for a few -- for a part of the capacity. Is that true? And how much would be the quantum if there could be any? And when can we expect the scheduling to happen?

Abhishek, as I just answered the previous question that we got responses. We have not converted into PPA or PSA right now. But a couple of the states have given their firm commitments. So that needs to be converted into PPA and PSA. Once we will do that, we will come back and we'll inform all the investors.

Okay. The firm commitments also cannot be shared right now?

It is difficult because there are contractual things, which are related to the nodal agency, which they have conducted a bid process. So part information may not be helpful at this point of time and may be avoided for the contractual reasons.

Okay. Fair enough. We'll wait for the update maybe in the coming quarters. Secondly, my apologies, I missed the debtors and creditor numbers. [ If you can give, that would be helpful ].

Yes. The debtors as at June '19 was around INR 9,000 crores, and the creditors were INR 7,200 crores.

Okay. And lastly, my question on Pranurja. So I'm just trying to understand that is it an investment or is it a business proposition for PTC, given that the Power Market Regulations have a condition that as a trader member, you can't hold more than 5%. And if you're not a trader member, then you cannot move your electricity on to the exchanges. And hence, for them to grow without your support will be difficult. So I'm just trying to understand the thought process behind that step.

See, the issue is, as I told you, Abhishek, sometime back that it is first, we'll keep crossing the bridge as it comes. So at present, we will be working with the CERC next month and then we'll be sitting together and taking call what we should do, what we should not do. It's too early to make a comment here.

[Operator Instructions] The next question is from the line of Arun L from MH Capital.

This is in continuation with the discussion on the sale for the financial services company. What I understand is the deadline of July 31 was for expression of interest. Going forward, what will be the process? How many companies are you looking at short listing? What is the time for diligence? And then what is the time for completion of the process? By what time can we expect that to happen?

See, as I said to you sometime back that the merchant bankers, they are working on that, whatever expression of interest and NDAs have been there. I'm sure they must be issuing process letters, et cetera. Those things will keep going on. And only when all those things are completed, they will come back to us, and then will we all -- there is -- the Board or the Board-authorized group of directors, they will sit through and take a call depending upon what type of responses have come and how do we go forward. But in the meantime, just to explain, from PTC as a promoter, we have already got the due diligence done. This COVID period, which was there, we used that to get the due diligence -- financial and legal due diligence, we have got it done from reputed people who were accepted to the investors in the world. So whenever those guys, who will be selected to do -- to enter into the final due diligence, et cetera, they should not be taking so much time than just to go into a company where there is nothing preparedness, only data is there, raw data is there. So raw data converted into stacks, everything is already prepared there. So we believe, that's what I said, by the end of the next quarter, we should be in a position to answer most of your queries.

Okay. But at a very broad level, do we say that we will complete the process -- I mean if it is possible for you to answer, we look at 6 months for money in the bank? Or would it be like a 12-month process as well from here? I understand what you're saying, but then still while the bankers would be advising you, still there is a timeline that we all work with. The timeline might change because things are a little dynamic, but what is the internal timeline that you guys are working with as of now?

See, we believe -- that's what I said, by the end of -- when I said that by the end of the next quarter, we should be able to improve the position, what is going to be there. And after that, obviously, then the legal -- suppose we select a guy also, it takes a couple of months to do the money into the bank. So it's too early to jump to that stage, but we believe that we are -- this time, we are going very gradually step-by-step. And hopefully, by the end of the financial year, the things -- we should be in a position to be looking at things, if it is happening, if it is happening in the right [ direction ].

[Operator Instructions] The next question is from Devansh Nigotia from SIMPL.

Yes. Just a follow-up question. Sir, now the bilateral contracts can be traded on the exchange. So if one has to compare it with the bilateral contracts that are already trading on the platform, sir, how do you see things going forward? This is one. And second is, what are the charges that are there on the platform right now? Are there any charges or not?

I'll answer you. I mean you must be asking this question based on the media reports that now the bilateral contracts will be tradable in the exchange. I think the process is still on. And still, the matter is at the Supreme Court. Both the parties, the SEBI and the CERC, have to withdraw it from the Supreme Court. Once that is withdrawn, I think then there will be some standard operating procedure for getting it converted in the business process. How these transactions for futures and derivative, which will be converted into these tradable PPAs, will be drawn. And it may take some time before you can see the real trading of the bilateral contracts tradable on the exchanges. And which exchanges? That, again, will be something which will be decided. Now at this point of time, we can only say that it is not being done. It is being contemplated. And once it will be completed -- will come into actual operation, we'll let you know. And how we are going to operate in that area, we will share with you.

And sir, are there any transaction charges on the platform, I mean -- so based on it operated by government and...

No, I told you that the standard operating procedure for these transactions will be made once it is decided who will be the regulator for it. And as we all know at this point of time, for these -- all these commodity trading of futures and derivative will be at some other exchanges, maybe governed by SEBI. There, all the procedures will be defined, and then we will be in a position to answer your query which you are making at this point in time.

[Operator Instructions] As there are no further questions, I'd like to hand the conference back to the management team for closing comments.

Thank you very much. I really profusely thank all of you who, on a Janmashtami Day holiday -- in Delhi, it's a holiday. We all have come to the office to take the call. So it has been a journey. The last quarter journey was really, really tough. And it is because of the teamwork. And the best thing which I saw in the last quarter was complete unity among all the stakeholders of the power sector, whether it was Government of India Ministry of Power, whether it was the regulator, whether it's the state discoms, whether it was IPPs, transmission company, everyone handholding each other. That in the most difficult times, everyone handheld each other, showed us the patience that things will improve. And that has started now showing the results that, as my CFO was saying, the money has started coming into the system. Obviously, it's going to be long, long this thing. And whether 31st March -- the government was also making this thing that there is a discussion that it can go up to 30th June also. So all those things are going to be closely watched by all of us and take proactive stance so that our volumes, our profitability keeps increasing. Thank you very much.

Thank you very much.