36th Annual Report 2011-2012 A Maharatna Company CMD and Directors at the Analysts & Investors Meet at Mumbai on 1st August 2012 Powering India’s Growth A Maharatna Company NTPC Bhawan, SCOPE Complex, 7, Institutional Area, Lodhi Road, New Delhi - 110003 www.ntpc.co.in VISION “TO BE THE WORLD’S LARGEST AND BEST POWER PRODUCER, POWERING INDIA’S GROWTH” NTPC Awarded `SCOPE Meritorious Award 2010-11’ for NTPC Director (Finance) Shri A. K. Singhal receiving the Corporate Social Responsibility & Responsiveness by HE `GSBA-Top Rankers Excellence Award 2011’ in the ‘Best President of India Smt. Pratibha Devisingh Patil. The Gold Finance Professional’ category from Shri Subodh Kant Trophy was received by Shri Arup Roy Choudhury CMD Sahai, Union Minister of Tourism. The award has been and Shri S. P. Singh, Director (HR), NTPC in the presence of given to Shri Singhal for his contribution in helping Shri Praful Patel, Hon’ble Union Minister of Heavy Industries NTPC register a spectacular performance and setting new & Public Enterprises. benchmarks in physical and fi nancial performance. MISSION “DEVELOP AND PROVIDE RELIABLE POWER, RELATED PRODUCTS AND SERVICES AT COMPETITIVE PRICES, INTEGRATING MULTIPLE Dr. M. Veerappa Moily , Union Minister of Corporate Aff airs NTPC received the `Good Corporate Citizen Award-2011’ presenting the trophy to Shri Arup Roy Choudhury CMD by PHD Chamber of Commerce. The award was presented ENERGY SOURCES WITH INNOVATIVE AND ECO-FRIENDLY NTPC and Chairman SCOPE on his felicitation by Dun & by Smt. Meira Kumar, Hon’ble Speaker Lok Sabha to Bradstreet at India’s Top PSUs 2012 function held in New Shri I. J. Kapoor, Director (Comml) NTPC and Shri A. K. TECHNOLOGIES AND CONTRIBUTE TO SOCIETY” Delhi on May 28, 2012 for his contribution to the public Rastogi , Company Secretary, NTPC. sector . CORPORATE OBJECTIVES To realise the vision and mission, eight key corporate objectives have been identifi ed. These objectives would provide the link between the defi ned mission and the functional strategies: Business portfolio growth - To aim for performance excellence in the diversifi cation • To further consolidate NTPC’s position as the leading thermal businesses. power generation Company in India and establish a presence - To embed quality in all systems and processes. in hydro power segment. Human Resource Development • To broad base the generation mix by evaluating conventional • To enhance organisational performance by institutionalising and non-conventional sources of energy to ensure long run an objective and open performance management system. competitiveness and mitigate fuel risks. • To align individual and organisational needs and develop • To diversify across the power value chain in India by business leaders by implementing a career development considering backward and forward integration into areas system. such as power trading, transmission, distribution, coal • To enhance commitment of employees by recognising and mining, coal benefi ciation, etc. rewarding high performance. • To develop a portfolio of generation assets in international • To build and sustain a learning organisation of competent markets. world-class professionals. • To establish a strong services brand in the domestic and • To institutionalise core values and create a culture of team- international markets. building, empowerment, equity, innovation and openness Customer Focus which would motivate employees and enable achievement of strategic objectives. • To foster a collaborative style of working with customers, growing to be a preferred brand for supply of quality Financial Soundness power. • To maintain and improve the fi nancial soundness of NTPC by prudent management of the fi nancial resources. • To expand the relationship with existing customers by offering a bouquet of services in addition to supply of power • To continuously strive to reduce the cost of capital through – e.g. trading, energy consulting, distribution consulting, prudent management of deployed funds, leveraging management practices. opportunities in domestic and international fi nancial markets. • To expand the future customer portfolio through profi table diversifi cation into downstream businesses, inter alia retail • To develop appropriate commercial policies and processes distribution and direct supply. which would ensure remunerative tariffs and minimise receivables. • To ensure rapid commercial decision making, using customer specifi c information, with adequate concern for the interests • To continuously strive for reduction in cost of power of the customer. generation by improving operating practices. Agile Corporation Sustainable Power Development • To contribute to sustainable power development by • To ensure effectiveness in business decisions and discharging corporate social responsibilities. responsiveness to changes in the business environment by: • To lead the sector in the areas of resettlement and - Adopting a portfolio approach to new business rehabilitation and environment protection including development. effective ash-utilisation, peripheral development and energy - Continuous and co-ordinated assessment of the business conservation practices. environment to identify and respond to opportunities • To lead developmental efforts in the Indian power sector and threats. through efforts at policy advocacy, assisting customers in • To develop a learning organisation having knowledge-based reforms, disseminating best practices in the operations and competitive edge in current and future businesses. management of power plants etc. • To effectively leverage Information Technology to ensure Research and Development speedy decision making across the organisation. • To pioneer the adoption of reliable, effi cient and cost- Performance Leadership effective technologies by carrying out fundamental and applied research in alternate fuels and technologies. • To continuously improve on project execution time and cost in order to sustain long run competitiveness in generation. • To carry out research and development of breakthrough techniques in power plant construction and operation that • To operate & maintain NTPC stations at par with the best-run can lead to more effi cient, reliable and environment friendly utilities in the world with respect to availability, reliability, operation of power plants in the country. effi ciency, productivity and costs. • To disseminate the technologies to other players in the sector • To effectively leverage Information Technology to drive and in the long run generating revenue through proprietary process effi ciencies. technologies. 36th Annual Report 2011-2012 1 REFERENCE INFORMATION Registered Offi ce Bankers Allahabad Bank NTPC Bhawan, SCOPE Complex , 7, Institutional Area, Lodi Road, Andhra Bank New Delhi – 110 003 Bank of Baroda Phone No. : 011-2436 0100 Bank of India Fax No. : 011-2436 1018 Canara Bank Web site : www.ntpc.co.in Central Bank of India Citi Bank, NA Subsidiaries Dena Bank NTPC Electric Supply Company Ltd. Indian Overseas Bank NTPC Hydro Ltd. ICICI Bank Ltd. NTPC Vidyut Vyapar Nigam Ltd. IDBI Bank Ltd. Kanti Bijlee Utpadan Nigam Ltd. Jammu & Kashmir Bank Ltd. Bhartiya Rail Bijlee Company Ltd. Oriental Bank of Commerce Punjab National Bank Registrar & Share Transfer Agent Punjab & Sind Bank Karvy Computershare Pvt. Ltd. State Bank of Bikaner & Jaipur 17-24, Vittal Rao Nagar State Bank of Mysore Madhapur State Bank of Hyderabad Hyderabad – 500 081 State Bank of India Phone No. : 040-2342 0815-28 State Bank of Patiala Fax No. : 040-2342 0814 State Bank of Travancore E- Mail – Id : [email protected] UCO Bank Union Bank of India Shares listed at United Bank of India National Stock Exchange of India Limited Vijaya Bank Bombay Stock Exchange Limited Depositories Auditors National Securities Depository Limited M/s O. P. Bagla & Co. Central Depository Services (India) Limited M/s K. K. Soni & Co. M/s PKF Sridhar & Santhanam Company Secretary M/s V. Sankar Aiyar & Co. A. K. Rastogi M/s Ramesh C. Agrawal & Co. M/s A. R. & Co. 2 36th Annual Report 2011-2012 CONTENTS • Letter to Shareholders .................................................................................................................................................5 • Notice of AGM ............................................................................................................................................................8 • Station-wise Generation ............................................................................................................................................. 17 • Selected Financial Information ..................................................................................................................................19 • Directors’ Profi le ........................................................................................................................................................20 • Senior Management Team .........................................................................................................................................25 • Directors’ Report ....................................................................................................................................................... 26 • Management Discussion and Analysis ......................................................................................................................43 • Report on Corporate Governance .............................................................................................................................68