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DHI companies sign compact for 2010

31 July 2010

With Druk Green Power Corporation signing its per­formance compact with Druk Holding and Investments (DHI) this week, DHI has com­pleted signing performance compacts with its six compa­nies for 2010.

All the companies have committed to improve work­ing conditions, customer satisfaction, and exploring and establishing more areas of business.

However, three compa­nies have not predicted good financial performance.

Druk Green Power Corpora­tion (DGPC)

DGPC is committed to com­pleting the feasibility study of the diversion scheme of Toktogomchu, complete 30 percent of the feasibility report of Nikachu, and com­plete study on the renovation, modernisation, automation and up-rating of Chukha Hy­dropower Plant.

The corporation projected a minimal increase in revenue. It is attributed to anticipated increase in domestic power demand by 218.82 million units due to which there will be an opportunity loss of Nu 112.92 million.

Further, there is an expense of Nu 133.71 million for com­prehensive insurance cover­age of all power plants.

Natural Resources Develop­ment Corporation (NRDCL)

This year, NRDCL commit­ted itself to identify 10 stone quarries, complete feasibility study and get clearances for them. It plans to complete financial feasibility for six crushing plants by September end and assessment of inven­tory of boulders in the south for export.

The corporation has also committed to constructing 25 km of forest road, produce 1.87 million cft of timber and supply about 10 percent of it to rural people at subsidised rates. It will carry out 55.38 hectres of plantation and pro­duce 186,000 seedlings.

NRDCL will also produce and market 50,000 truckloads of sand, 27,000 truckloads of stone, and 500,000 kg of briquettes in addition to fire­wood supplied from the forest residues.

Bank of Bhutan (BoB)

BoB plans to install Central Banking System (CBS) in all the 20 dzongkhags. Internet banking is expected to expand with about 10,000 users and Nu 20 million fund transfers in a month.

The bank hopes to open a new domestic branch, install more ATMs, and reduce the waiting time to maximum of 30 minutes for counter services.

BoB will apply for VISA and Master Card membership and launch credit cards issuing and acquiring capability this year.

It hopes to make BoB ATM cards usable in ATM machines of other banks and vice versa on a chargeable basis.

BoB will also introduce prepaid cards in India.

However, the revenue and profit for the year is expected to decline with competition from the two new banks.

Bhutan Telecom (BTL)

BTL is committed to improv­ing mobile customer satisfac­tion, increase the customer base to 230,000 by the end of the year, expand broadband connectivity from 27 to 37 lo­cations, and upgrade internet backbone from 110 Mbps to 310 Mbps.

BTL will also sign a contract with IPCL circuit provider to diversify fibre connectivity gateways out of Bhutan. The rural GSM project will be completed and con­nectivity will be provided to 27 of the 28 gewogs under the project.

It plans to replace or re­furbish the Thimphu satellite earth station, which is over 20 years old, create Wi-Fi hotspots for internet access at two sites, launch convergent billing, and reach ICT facili­ties to six remote schools and provide free internet access.

Bhutan Power Corporation (BPC)

BPC is committed to electrify­ing at least 9,000 rural house­holds under the JICA and ADB funded rural electrification projects and about 967 house­holds under the fill-in rural electrification programme.

The corporation will ensure that there will be no facilities for its employees while working on the trans­mission and distribution network. It hopes to achieve a customer satisfaction index of 92 percent.

BPC will complete the replacement of ground wire with OPGW on the Phuentsh­oling-Thimphu 220 kV line.

BPC has set a lower target of return on equity on account of increasing its equity injec­tion on capital investment. However, the sale of power in the domestic market will increase.

Drukair Corporation

Drukair has committed to launching domestic air services subject to regularity clearance from the govern­ment and shareholders, and increase the number of Indian tourists by five percent.

To initiate plans to con­struct a new corporate office, Drukair will complete proce­dures with the dzongkhag and National Land Commission to get thram. The catering unit will be delinked as a different profit unit.

More focus will be given on improving customer service and obtain at least 80 percent customer satisfaction.

The airline will complete study on routes to Singapore and Hong Kong, build in-house capacity to conduct recurrent training by 2011, develop pricing strategy for financial sustenance and complete feasibility study for landing lights or beacons.

Financial performance projection

Profit after tax (in million Nu) 2009 2010
DGPC 4574.61 4157.20
NRDCL 43.261 37.847
BoB 471.60 350
BTL 180.111 207.13
BPC 732.437 785.728
Drukair 102 109
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