Rating Rationale
May 23, 2025 | Mumbai
PTC India Limited
'Crisil AA-/Stable' assigned to Corporate Credit Rating
 
Rating Action
Total Bank Loan Facilities RatedRs.5500 Crore
Short Term RatingCrisil A1+ (Reaffirmed)
 
Corporate Credit RatingCrisil AA-/Stable (Assigned)
Rs.300 Crore Commercial PaperCrisil A1+ (Reaffirmed)
Note: None of the Directors on Crisil Ratings Limited’s Board are members of rating committee and thus do not participate in discussion or assignment of any ratings. The Board of Directors also does not discuss any ratings at its meetings.
1 crore = 10 million
Refer to Annexure for Details of Instruments & Bank Facilities

Detailed Rationale

Crisil Ratings has assigned its ‘Crisil AA-/Stable’ corporate credit rating to PTC India Ltd (PTC India). Crisil Ratings has also reaffirmed its ‘Crisil A1+’ rating on the short-term bank facilities and Rs.300 crore commercial paper.

  

The rating continues to reflect the leadership position of PTC India in the domestic power trading market, healthy relationships with customers, strong market linkages because of its long track record along with negligible bad debts since inception. The same is supported by its robust financial risk profile with no long-term debt obligation, low fund based working capital limit utilization and healthy liquidity on its books. The company has been net debt negative since fiscal 2023 and the position is expected to sustain in the near to medium term. These strengths are partially offset by exposure to counterparty risk.

 

Crisil Ratings has taken note of the recent completion of sale of PTC Energy Limited (PEL, Crisil AA/Stable/A1+) to ONGC Green Limited for equity value of Rs. 1,179 crore (Investment cost: Rs. 654 crores). The sale of PEL has supported the overall credit profile of PTC India with the leveraged wind assets moving out.

Analytical Approach

To arrive at its rating, Crisil Ratings has assessed PTC India Limited on its standalone profile post the conclusion of sale of PTC Energy Limited to ONGC Green Limited. Adjustments for assets and liabilities have been made as per Crisil Ratings capital allocation approach for the financing business undertaken by PTC Financial Services Limited (PFS).

 

Please refer Annexure - List of Entities Consolidated, which captures the list of entities considered and their analytical treatment of consolidation.

Key Rating Drivers & Detailed Description

Strengths:

  • Leadership position in the domestic power trading market: PTC India is the largest player in the Indian power trading market, with a market share of ~33% of total volume traded in nine month fiscal 2025. The market share is expected to be on similar lines for fiscal 2025. The company is likely to maintain its dominant market position over the medium term, despite the intensifying competition.

 

  • Long track record of operations resulting in strong customer relationships and market linkages: PTC India was the first company to start power trading in India in 2001; over the years, it has established strong relationships with various players including state power utilities (SPUs). Long and medium-term trades, which fetch a relatively higher margin (including cross border), contributed around 41% of total volume, while short-term trades accounted for the balance, during 9M FY2025. Efficiency in client servicing and management should also help the company maintain its market leadership position.

 

  • Healthy financial risk profile: Financial risk profile is underscored by a comfortable capital structure and healthy cash accrual. PTC India receives a rebate from generation companies in case of timely payment for the power procured and charges surcharge from distribution companies (discoms) in case of delay in receiving payment for the power sold. Net working capital cycle* ranged from 15 to 26 days over the three fiscals through March 2024. The company has no long-term debt on a standalone basis and meets its working capital through a fund-based limit of Rs 2,000 crore (of which ~Rs 1,899 crore was unutilised as of March 2025). Cash and equivalents were healthy at ~Rs 2,100 crore as of March 2025. With the receipt of cash from sale of PTC Energy Limited, cash balance has improved, and company remained net cash** surplus as on March 31, 2025. 

 

No additional investments/support is envisaged from PTC India towards PFS. However, Crisil Ratings expects that PTC India may provide need-based support, in case of distress. Any significant investment in PFS, which adversely impacts financial risk profile of PTC India, will remain a key sensitivity factor.

 

*Net working capital cycle = debtor days less creditor days; Crisil Ratings has added the sale/purchase of electricity of agency nature also in the revenue from operations since the debtors / creditors include those amounts as well.

**Net cash = Cash and equivalents – Total debt

 

Weaknesses:

  • Susceptibility to counterparty risk: PTC India remains susceptible to weak credit risk profiles of customers, mainly SPUs. The company tries to mitigate counterparty risk by distributing sales across multiple buyers and through payment security mechanisms. Seasonal reversal of buy-and-sell positions of SPUs also acts as a natural hedge. However, the large scale of operations reduces the risk of default and enables PTC India to negotiate better terms with clients. Net working capital cycle ranged from 15 to 26 days over the three fiscals ended March 31, 2024. From the peak of 38 days during the Covid-19 pandemic, working capital cycle has reduced consistently over the years. However, the risk of prolonged delays in payment by customers remains a key rating sensitivity factor.

 

  • Susceptibility to open positions: PTC India would be leveraging upon its more than 2 decades of experience and might be taking limited open positions in the power trading market which is expected to add an additional revenue stream.

Liquidity: Strong

On a standalone basis, cash and equivalent stood around Rs 2,100 crore, along with an unutilized fund-based bank limit of Rs 1,899 crore as on March 31, 2025. These, along with annual cash accrual, should suffice to cover working capital expenses over the medium term. Ability to stretch payables provides additional comfort. Given the operational track record and longstanding relationships with discoms, liquidity should be prudently managed and will remain healthy over the medium term. Further, the management has committed to maintain adequate liquidity levels to meet the working capital requirements at all times.

Outlook: Stable

The business and financial risk profile of the company is expected to be supported by its market leadership in the power trading segment, more than 2 decades of experience, no long term debt and healthy revenue visibility.

Rating sensitivity factors

Upward Factors:

  • Continued demonstration of clean auditor report with no further investigations/ developments pertaining to the alleged governance issues in the past
  • Improvement in the market share of the power trading business on a sustained basis led by an uptick in traded volumes
  • Improvement in the overall debtor concentration, leading to a diversified debtor base with top 10 debtors contributing less than 75-80% of the total debtors

 

Downward Factors:

  • Significant delay in realisation of dues from counterparties, leading to receivables* (standalone) of around 120 days or more, on a sustained basis
  • Weaker operating performance with significant reduction of trading sales volumes and/or reduction in EBITDA / unit impacting the cash accruals.
  • Weakening of the liquidity position due to weaker operating performance/ any other factor

 

*Excluding receivables on account of tariff revision, compensation and change in law matter, which are paid only after being received.

About the Company

PTC India was incorporated in 1999, to support implementation of the mega power policy of the government. The promoters are NHPC Ltd, NTPC Ltd ('Crisil AAA/Stable/Crisil A1+'), Power Finance Corporation Ltd (‘Crisil AAA/Stable/Crisil A1+’), and Power Grid Corporation of India Ltd (‘Crisil AAA/Stable/Crisil A1+’). PTC India has a Category I license issued by the Central Electricity Regulatory Commission under the Electricity Act 2003, which permits unlimited trading in power. It is the largest player in the power trading market with share of ~33% in fiscal 2024. PTC India traded around 64 billion units in 9M FY2025 (around 75 billion units in fiscal 2024).

 

For the nine months ended Dec 31, 2024, PTC India, on a standalone basis, reported revenue from operations of Rs 12,755 crore and profit after tax of Rs 333 crore as against Rs 12,675 crore and Rs 286 crore, respectively, for the corresponding period previous fiscal.

Key Financial Indicators (Standalone)*

As on/for the period ended March 31

Unit

2024

2023

Operating income

Rs.Crore

16,007

14,887

Profit after tax (PAT)

Rs.Crore

369

370

PAT margin

%

2.3

2.5

Adjusted debt/adjusted networth

Times

0.10

0.06

Interest coverage

Times

26.5

13.7

*As per analytical adjustments made by Crisil Ratings

Any other information: Not applicable

Note on complexity levels of the rated instrument:
Crisil Ratings` complexity levels are assigned to various types of financial instruments and are included (where applicable) in the 'Annexure - Details of Instrument' in this Rating Rationale.

Crisil Ratings will disclose complexity level for all securities - including those that are yet to be placed - based on available information. The complexity level for instruments may be updated, where required, in the rating rationale published subsequent to the issuance of the instrument when details on such features are available.

For more details on the Crisil Ratings` complexity levels please visit www.crisilratings.com. Users may also call the Customer Service Helpdesk with queries on specific instruments.

Annexure - Details of Instrument(s)

ISIN Name Of Instrument Date Of Allotment Coupon Rate (%) Maturity Date Issue Size (Rs.Crore) Complexity Levels Rating Outstanding with Outlook
NA Commercial Paper NA NA 7-365 days 300.00 Simple Crisil A1+
NA Fund-Based Facilities NA NA NA 850.00 NA Crisil A1+
NA Non-Fund Based Limit NA NA NA 1900.00 NA Crisil A1+
NA Non-Fund Based Limit$ NA NA NA 250.0 NA Crisil A1+
NA Non-Fund Based Limit** NA NA NA 550.0 NA Crisil A1+
NA Non-Fund Based Limit* NA NA NA 1400.0 NA Crisil A1+
NA Proposed Short Term Bank Loan Facility NA NA NA 550.00 NA Crisil A1+

* Interchangeable with fund-based facilities
** Out of the total limits of IDBI bank limited (including fund-based and non-fund based), Rs.300 cr. limit is interchangeable with Commercial Paper limit
$ Rs 100 crore bank guarantee limit considered for non-fund based limit

Annexure - List of Entities Consolidated

Names of entities consolidated

Extent of consolidation

Rationale for consolidation

PTC India Financial Services Ltd

Moderately consolidated

Adjustments for the assets and liabilities as per the capital allocation approach of CRISIL Ratings
Annexure - Rating History for last 3 Years
  Current 2025 (History) 2024  2023  2022  Start of 2022
Instrument Type Outstanding Amount Rating Date Rating Date Rating Date Rating Date Rating Rating
Fund Based Facilities ST/LT 1400.0 Crisil AA-/Stable / Crisil A1+   -- 30-10-24 Crisil A1+ 31-10-23 Crisil A1+ 16-12-22 Crisil A1+ Crisil A1+
      --   --   -- 30-01-23 Crisil A1+ 31-01-22 Crisil A1+ --
Non-Fund Based Facilities ST 4100.0 Crisil A1+   -- 30-10-24 Crisil A1+ 31-10-23 Crisil A1+ 16-12-22 Crisil A1+ Crisil A1+
      --   --   -- 30-01-23 Crisil A1+ 31-01-22 Crisil A1+ --
Corporate Credit Rating LT 0.0 Crisil AA-/Stable   --   --   --   -- --
Commercial Paper ST 300.0 Crisil A1+   -- 30-10-24 Crisil A1+ 31-10-23 Crisil A1+ 16-12-22 Crisil A1+ Crisil A1+
      --   --   -- 30-01-23 Crisil A1+ 31-01-22 Crisil A1+ --
All amounts are in Rs.Cr.
Annexure - Details of Bank Lenders & Facilities
Facility Amount (Rs.Crore) Name of Lender Rating
Fund-Based Facilities 100 Canara Bank Crisil A1+
Fund-Based Facilities 350 HDFC Bank Limited Crisil A1+
Fund-Based Facilities 400 Union Bank of India Crisil A1+
Non-Fund Based Limit 200 Canara Bank Crisil A1+
Non-Fund Based Limit 400 Indian Overseas Bank Crisil A1+
Non-Fund Based Limit& 250 The Federal Bank Limited Crisil A1+
Non-Fund Based Limit^ 150 Indian Overseas Bank Crisil A1+
Non-Fund Based Limit 550 ICICI Bank Limited Crisil A1+
Non-Fund Based Limit 300 IndusInd Bank Limited Crisil A1+
Non-Fund Based Limit 150 IDFC Limited Crisil A1+
Non-Fund Based Limit^ 500 ICICI Bank Limited Crisil A1+
Non-Fund Based Limit^ 250 Bank of Baroda Crisil A1+
Non-Fund Based Limit# 550 IDBI Bank Limited Crisil A1+
Non-Fund Based Limit 300 Union Bank of India Crisil A1+
Non-Fund Based Limit^ 200 HDFC Bank Limited Crisil A1+
Non-Fund Based Limit^ 300 IndusInd Bank Limited Crisil A1+
Proposed Short Term Bank Loan Facility 550 Not Applicable Crisil A1+
& - Rs.100 cr. BG limit considered for non-fund based limit.
^ - Interchangeable with fund based facilities
# - Out of the total limits of IDBI bank limited (including fund-based and non-fund based), Rs.300 cr. limit is interchangeable with Commercial Paper limit
Criteria Details
Links to related criteria
Basics of Ratings (including default recognition, assessing information adequacy)
Criteria for consolidation
Criteria for manufacturing, trading and corporate services sector (including approach for financial ratios)

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