Dec.Gold Mines — Q2 FY26 earnings call

Call held 25 Nov 2025

Management summary

Deccan Gold Mines Limited reported significant progress in Q2 FY26, with the successful commissioning of the Jonnagiri plant and imminent trial production at the Kyrgyzstan project. The company outlined ambitious production targets for both gold mines and its critical mineral projects in Mozambique, Finland, and Bhalukona. A rights issue of ₹315 crores is planned to clear existing debt of approximately ₹200 crores, aiming for a debt-free status by year-end 2025, with remaining funds allocated to exploration and potential acquisitions.

Highlights

  • Jonnagiri plant commissioning successfully completed, full-scale production underway with initial forecast of 400 kg/year, eventually targeting 800 kg/year.

  • Kyrgyzstan project's trial production is set to begin within a couple of weeks, with an annual production target of 350 kg by FY27, peaking at 800 kg.

  • Company aims to become debt-free by the end of 2025, with a planned rights issue of ₹315 crores primarily for debt repayment.

  • Discovered nickel-copper-PGM mineralization in Bhalukona, with drilling planned from January onwards.

  • Lithium and copper-gold exploration in Mozambique showing strong evidence of mineralization, with drilling for both planned from January onwards.

  • Overall EBITDA margins are projected to be 70-75%, with Kyrgyzstan PAT at 35-40% and Jonnagiri EBITDA at 75%.

  • Total gold production (Deccan's share) is targeted at around 2 tons, with an additional 2.5-3 tons from other critical minerals, totaling 5-5.5 tons.

Concerns

  • Dilution of shareholder value

  • Legal and regulatory impasse for Ganajur/Hatti

Key financials

  1. Market Capitalization ₹2,000 Cr
  2. Altyn Tor AISC 1,045 USD per ounce
  3. EBITDA Margin (Overall) 70%
  4. PAT (Kyrgyzstan) 35%
  5. EBITDA (Jonnagiri) 75%

What they filed

Q1 FY27: revenue up 57.9%, net profit up 69.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue4 1 0 0 3 −16%1 +32%9 +1885%1 +58%
EBITDA-21 -22 -21 -24 -9 +56%-10 +55%-1 +94%-12 +52%
Net profit-68 -25 12 -28 -20 +71%-22 +10%6 −52%-9 +69%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Capital allocation

high confidence
  • Capex ₹315 Cr Primarily through rights issue
    • Debt repayment ₹200 Cr
    • Initial stage exploration and drilling programs
    • Potential acquisitions
    The objectives of this issue is primarily the repayment of the debt. As you all know, we have about Rs.200 Crores of debt on the company for which we have pledged the Geomysore shares. So it is becoming very, very important for us to get rid of the debt. So the entire rights issue is actually focused towards repayment of the debt. Large part of it is going towards repayment of debt. And also, as I mentioned in the previous slide, we are going to do an initial stage exploration and billing in four other projects. So the balance of money will be used to fund these billing programs. And also we are looking at one or two projects which we may acquire subject to the successful due diligence, again in the gold and critical mineral scenario. So after paying the debt, the balance amount will be used for these purposes, which we believe will create significant value for the company.
  • Debt Gross ₹200 Cr Cost 12%
    • Repayment Repayment of existing debt using rights issue proceeds ₹200 Cr
    As of today, if you actually see, his exposure to the company is almost like Rs.400 Crores in terms of equity and debt that he has. So obviously at some point we had to pledge the shares as a collateral, which we did. And we are now going to take back the pledge and the Geomysore shares will be free for us. So I do not know what is the point we are trying to make. If this is a proper commercial arrangement, and also we got the debt at around 12%, I think. It is very reasonable in terms of market issues.
  • M&A One or two projects Acquisition · Announced

    To create significant value for the company in gold and critical mineral scenario

    And also we are looking at one or two projects which we may acquire subject to the successful due diligence, again in the gold and critical mineral scenario.

Guidance & targets

Production Volume

  • Altyn Tor Gold Production Production Volume · FY27 · High confidence 350 kg
    And gold production from Altyn Tor, that is where we will start getting a lot of the revenues, whatever that have been anticipated into the company, that will happen in 2026. And other projects like mineral resources in Altyn Tor and Finland, through the continuous drilling activity, will increase. Again, the increase in any mineral resources will increase the value of the company that is what we are looking at in the next year and exploration and resource definition, drilling in Altyn Tor, Finland, Mozambique, and Barcelona. These are the four projects which we are going to focus next year to carry out the drilling and increase the resource so that at a later date, probably sequentially, they would become the mineable projects.

    — Hanuma Prasad, Managing Director

  • Altyn Tor Gold Production (Peak Potential) Production Volume · after 3-4 years · Medium confidence 800 kg
    And the peak potential for that project is about 800 kilos, but that peak potential will be achieved after three to four years when we get into the underground operation.

    — Hanuma Prasad, Managing Director

  • Jonnagiri Gold Production (Initial Forecast) Production Volume · per year · High confidence 400 kg
    And the initial production forecast is around 400 kilos per year, but eventually it will go to 800 kilos plus almost to a ton, depending on the resource that has been approved.

    — Hanuma Prasad, Managing Director

  • Jonnagiri Gold Production Production Volume · FY27 · High confidence 500 kg
    And in FY2027, it is projected to produce around 500 kilos and from next year onwards, it will increase to 750 kilos. And eventually, it will peak at around a ton per year, when it also starts an underground operation.

    — Hanuma Prasad, Managing Director

  • Jonnagiri Gold Production (Next FY) Production Volume · next financial year · High confidence 400 kg
    So just one question regarding the Jonnagiri project and it was so since we will be producing almost close to 400 kgs in next financial year from Jonnagiri and close to your whatever the AISC that you declared based on that we are at

    — Parth Agrawal

  • Finland Gold Production Production Volume · per annum · High confidence 276 kg
    So initial feasibility we will do it, we will start at four tons once we identify that, once we convert the existing drill results into the four tons of result and it will produce around 276 kilos per annum. Initially that is the kind of production, but that will come into the production in the year 2029, that is FY.

    — Hanuma Prasad, Managing Director

Production Start

  • Finland Mine Operation Production Start · FY29 · High confidence 2029
    Initially that is the kind of production, but that will come into the production in the year 2029, that is FY.

    — Hanuma Prasad, Managing Director

  • Mozambique Lithium/Tantalum Production Production Start · 2026 · Medium confidence Next year
    Now the revised plant is by next year and we will have this 100 TBD plant that is being set up. Test work is still going on and some amount of drilling we want to do, which we will be doing in the month of starting from January coming year. Similarly, in Mozambique, we have another few tenements that we have taken in the last few months that is in the Tete complex and we own about 95% of it. There are multiple zones of copper plus gold that have been identified and they are ready-made drill targets and we would start the drilling operations as early as possible in the beginning of next year itself.

    — Hanuma Prasad, Managing Director

  • Mozambique Small Scale Operation Production Start · 2026 · Medium confidence Very likely next year
    So between these two, a small scale operation in Mozambique is very likely next year.

    — Hanuma Prasad, Managing Director

  • Finland Full-fledged Underground Mining Production Start · 2026-2028 · Medium confidence Next two to three years
    And same time, Finland is something in the next two to three years that could come in a full-fledged underground mining operation.

    — Hanuma Prasad, Managing Director

Debt

  • Debt-free status Debt · end of this year · High confidence Debt-free
    If rights issue is the way we are going to take, then we are going to pay all the debts of the company, which will make Deccan as a debt-free entity by the end of this year, or whenever that is done, which is a major step for us moving forward.

    — Hanuma Prasad, Managing Director

ESG

  • ESG Compliance ESG · next year onwards · High confidence Completely ESG compliant
    And from next year onwards, we are going to be completely ESG compliant and we have already appointed a team of people who have been working on it.

    — Hanuma Prasad, Managing Director

Shareholder Engagement

  • Physical AGMs Shareholder Engagement · next year onwards · High confidence 100% physical AGMs
    but from next year onwards 100% we are going to have physical AGMs that there is no doubt about it.

    — Hanuma Prasad, Managing Director

Strategic Vision

  • Company Status Strategic Vision · by 2030 · High confidence Mid-tier gold producer and critical mineral supplier
    What we want to be by 2030, we achieve, we would like to become a mid-tier gold producer and begin supplying critical minerals as well.

    — Hanuma Prasad, Managing Director

Resource Potential

  • Deccan's Share of Gold Production Resource Potential · next few years · Medium confidence 2 tons
    Here I have shown essentially only the gold we would reach to a point of around 2 tons of gold production as our share, so that is what it is looking like.

    — Hanuma Prasad, Managing Director

  • Deccan's Share of Gold Equivalent Production Resource Potential · next few years · Medium confidence 5-5.5 tons
    Viraj, as I mentioned, I think during the presentation also, 2 or 2.5 tons is the Deccan share in the only gold terms and others the gold equivalent if all added like if you produce nickel, copper, lithium they will add another balance of 2.5 to 3 tons. And that will be Deccan's share also, because in most of the projects, Deccan has about more than 85% share in all these projects, including the one in Finland, where we have 32 now. But by the time we reach to the mining stage, we would have crossed 75% there. So yes, the balance is going to come from other commodities and it is all Deccan's share as such.

    — Hanuma Prasad, Managing Director

Mine Life

  • Altyn Tor Mine Life (Underground) Mine Life · at least · Medium confidence 15 years

    Previously 6 years → 15 years

    So the life of the mine is not going to start at six years. It is only the first phase of low hanging codes in the first six years that we are going to mine and beyond that we will get into the actual underground operations and then the life could be extended pretty long in fact. So I will not be surprised if it is somewhere around 15 years at least.

    — Hanuma Prasad, Managing Director

What to watch in Q3 FY26

Kyrgyzstan Trial Production Start

within a couple of weeks
Current Final preparations underway
Target Trial production commenced

Why it matters

This marks the beginning of revenue generation from a major project and will validate management's timelines.

We have set up everything, and within a couple of weeks, you will see that the trial production is underway.

Risks & concerns

  • Dilution of shareholder value

    high

    Concerns raised by shareholders regarding continuous equity dilution and reduction of stake in key projects like Jonnagiri.

    Analyst downplayed

  • Legal and regulatory impasse for Ganajur/Hatti

    high

    The projects are under legal and regulatory challenges related to the 10A(2)(b) policy.

    Analyst acknowledged

  • Production timeline delays

    medium

    Initial delays in Jonnagiri and Kyrgyzstan projects due to approvals and mobilization.

    Management acknowledged

  • Funding availability for new projects

    medium

    Difficulty in raising debt funding from banks/institutions due to lack of track record and collateral.

    Management acknowledged

  • Environmental approvals for Finland project

    medium

    Environmental approvals for Finland's Kuikka gold project are in progress, delaying trial mine start.

    Management acknowledged

Q&A highlights

4 direct
Rights Issue Timing, Stake Dilution, and Project Delays Partial
Hanuma, thank you for your answers to my query, but a few things were like. not straightforward to be honest when I asked why we did not raise funds for Jonnagiri earlier and you said that we might have not come to the investors again and we went to the whole world asking the money if you would have come to us two years ago or one year ago we would have given the money as we did 10 years ago this is my submission, all the minority shareholders were ready. We reduced our Jonnagiri stake to 27% from 42%. I know we were never allowed to be a major shareholder but every percentage increases the value of our company. We could have monetized that. One of my query was, it is now second, that do we have any plans to monetize our 27% stake in Jonnagiri so that we can use that money to mine, explore and built new assets which we own as majority shareholders that has not been answered that timing of the right issue there is no point in debating that you have answered all the queries but we still have our doubts we see there are ulterior motives there is ulterior motive of bringing someone back door, I submit that I can write it, I can write it to any damn authority in the world and it will prove I would not be proved wrong in the due course and Kyrgyzstan you have production you have answered and you have answered any plan in change promoter and all the that kind of answer but we were coming for this thing or that thing then we were flying the drones in Dubai we were doing all the wasting our money on in all those things and today we are not discussing all those. We would have used that money for Jonnagiri. You we would have asked money from the shareholders. We were ready to give. Today also we are ready to give the money. But I will again submit that the timing of the right issue is 100% wrong. It is 100,000% wrong. You said that it is for clearing the debt. We could have cleared the debt one month after the announcement of the Kyrgyzstan and Jonnagiri. It was supposed to be announced around Diwali. Okay, Diwali has gone. It might be before Christmas. The right issue could have come in January. The world is not going to fall in two months. The debt is not going to increase from Rs.200 Crores to Rs.2,000 Crores or Rs.200,000 Crores in two months. The timing of the right issue is wrong. I am again telling you. And in your representation, there is no timeline given for Bhalukona which is our 100% this thing and one major thing which you missed, I never said that to Hira, the mines. I am talking about the Bhalukona. It has been transferred into some private limited company again. Then you will take the debt. Then again, you will submit or surrender it to Hira. This is what I feel. I am in pain. I am a shareholder for last 15 plus years. I am seeing ups and downs. I have attended all the AGMs almost and interacted with so many of you guys. All of you guys arranged visit Supreme Court hearing and everything arranged Amitabh Kant, this thing, meetings also in Delhi, but we are being sidelined, to be honest. We shareholders who are sticking with company for last 15 years

Analyst strongly challenged management's rationale for rights issue timing, stake dilution in Jonnagiri, and perceived delays/mismanagement of funds, indicating significant shareholder dissatisfaction.

Asked by Imran Ghani

AISC, Production Targets, and Mine Life for Altyn Tor and Jonnagiri Direct
Hanuma sir, thank you very much for this detailed update. I understand there is some frustration from some of the shareholders on diluting the stake in Jonnagiri. Yes, I mean, we could have maybe done a rights issue in June, etc. Point taken. But I would just like to look ahead now what is done is done. Just a few questions, sir. In our slide, we have mentioned the AISC for Altyn Tor and Jonnagiri in the range of $1020 and $1045. So, is that the production cost as of today, sir? That was one question. Second is, so considering that today we are closer to 4,000 odd ton. So, therefore, we expect 70%, 75%, 80% kind of a margin thereabout. So, that was my first question, sir. As I can see, sir, Altyn Tor also we have mentioned about 350 kgs of production starting next year and for 28 if you can just clarify whether that can go up to 700 kgs. Within Altyn Tor we have mentioned that the mine has a six-year life only. So just if you can give some more color on that whether with the underground operations would that include the six years or with underground that goes up further. So that was the other question sir. So I believe our focus remains that we start the two mines and previously one of the shareholders did point out if we have our new mining

Analyst sought clarification on the current applicability of reported AISC, the potential for higher production at Altyn Tor, and the impact of underground operations on mine life, indicating focus on core profitability and longevity.

Asked by Prateek Kothari

Total Resource Potential of Jonnagiri and Kyrgyzstan Mines Direct
My question is, I want to ask about the total resource potential of both the projects, Jonnagiri and Kyrgyzstan mine. So as per your previous presentations, you have told that the total resource potential of Jonnagiri mine is close to 40 tons but the proven resource is up till date is 12 tons. So today you have mentioned that on further drilling it is expected that the proven resource could scale up to 20 tons. So by when we can expect the total resource to scale up to 40 tons and I also want to ask about the resource potential of Kyrgyzstan mine. Thank you. Thank you for the opportunity.

Analyst inquired about the long-term resource potential and timelines for increasing proven resources at key gold projects, which is crucial for future production and valuation.

Asked by Pranjal Agarwal

Equity Dilution and Debt Repayment Strategy with Hira Group Partial
My question is, in one hand, we are taking loans and giving equity to Hira. Second, if I have to understand if most of this rights issue money will go to get into paying the debt. I think most of the debt is with the Hira and all our Jonnagiri stake is pledged with Hira as on today. So we are seeing a one hand, we have diluted our equity to Hira to buy into Kyrgyzstan and Jonnagiri. And now we are saying we are paying them back from this right issue money itself so it is like taking money from one hand, giving money to the other hand, and wherein we have diluted 60% equity from last three years and we are raising, diluting more 15%.

Analyst questioned the circularity of debt and equity transactions with Hira Group and the continuous dilution of equity, raising concerns about the company's financial strategy and shareholder value.

Asked by Chander Gupta

Change in 2030 Gold Production Target and Stake in Jonnagiri/Altyn Tor Direct
My question is that why we are not increasing the stake in Jonnagiri from that initially it was a 42 and now it is 27. So why we are not increasing from 27 to 42 in Jonnagiri and in the Altyn Tor, why we are not increasing from 60% to 70% through right issues? And secondly, two years before the presentation was made in which we were told that in 2030 we will produce around five tons of gold or equivalent to gold. And now we are talking about only two tons. So why the target has been changed? Thank you.

Analyst highlighted a significant reduction in the long-term gold production target and questioned the strategy behind not increasing stake in key projects, indicating a potential downgrade in future outlook.

Asked by Rohit Singhal

Confidence in Rights Issue and Lack of Earnings Partial
Now, the question is at this price, do we further wait to we get an improved EPS and we wait for the earning and then subscribe for the right or what do we do? So this is, there is a good confusion that we have waited for 20 years, but now there is no earnings. And now we have to, again, subscribe for right as a small investor and do not have that much of confidence in the earning. Is there a possibility of whatever you have mined and done through the initial processing? or at least you present that and like equivalence and then we declare that as an earning and then we get the confidence. So there is a confusion basically. How do we subscribe for the right? I want clarity on that. Thank you.

Analyst expressed investor confusion and lack of confidence in subscribing to a rights issue given the long wait for earnings and the absence of clear financial performance from mining operations.

Asked by Rakesh Kolapkar

Status and Outlook for Ganajur and Hatti Projects Direct
My question is around the old blocks of Ganajur and Hatti. There is tremendous research done on the resources and extraction. And I mean, last time also we spoke, it has been under legal and regulatory impasse. So I want you to share the insights that you have from the legal advisors, how things are proceeding. not just pertaining to industrial but in our case even though there are similarities, how are we proceeding and the cost likely to be incurred and by when do we see some light of the day because these are the biggest muscles we have in our armor so far the new projects are fine they are essential but this is really key

Analyst sought an update on the long-stalled Ganajur and Hatti projects, which are considered significant assets, highlighting the importance of resolving legal and regulatory issues for future growth.

Asked by Pranay Jain

Plant Stabilization, Kyrgyzstan Delays, and Rights Issue Timing Partial
Thanks, Hanuma, for a nice presentation and the insights of the company. It is day-to-day working as well. So I am from the EPC background. So as per international norms, the plant stabilization takes around three to four months. If I am not wrong, we started the plant stabilization in the month of June. So even though our plant capacity is much smaller as per what we know from the BSE notifications, I understand the Lloyds Enterprise is building a refinery in the nearby plant area. So, basically, Geomysore. So, is this a reason for the plant innovation? Even in Kyrgyzstan, we do a project in oil and gas projects. The challenge is already known to people. There also, we have not done the efficient management, as you said. It has been delayed and we do not know the exact timeline for that project as well. So, is it not wiser to have a right issue after we make an announcement and have a higher price band instead of pushing the long-term investors into this right issue? So, let me have your viewpoint. Thank you.

Analyst questioned the efficiency of project management, delays in Kyrgyzstan, and the timing of the rights issue, suggesting that a later rights issue after production announcements might yield better pricing.

Asked by Deepak Shah

2 min read 6 chapters

Detailed narrative

Jonnagiri and Kyrgyzstan Project Progress

Deccan Gold Mines has successfully commissioned its Jonnagiri plant, with all trials completed and full-scale production commencing. The initial production forecast for Jonnagiri is 400 kg per year, expected to eventually reach 800 kg per year. For the Kyrgyzstan project (Altyn Tor), trial production is set to begin within weeks, targeting 350 kg annually by FY27 and a peak potential of 800 kg. Management emphasized that these two projects are crucial for driving company growth and revenue.

Critical Mineral Exploration and Development

The company has made significant strides in critical mineral exploration. In Bhalukona, a nickel-copper-PGM mineralization has been discovered, with drilling scheduled to start in January. In Mozambique, strong evidence of copper-gold mineralization has been found, and drilling for both lithium/tantalum and copper-gold is planned from January onwards. The Mozambique lithium project aims to establish a 100 ton per day processing facility and begin production of lithium and tantalum concentrates next year (2026).

Rights Issue and Debt Reduction Strategy

Deccan Gold plans to raise approximately ₹315 crores through a rights issue, primarily to repay its existing debt of about ₹200 crores. The goal is to become a debt-free entity by the end of 2025. The remaining funds from the rights issue will be allocated to initial stage exploration, drilling programs, and potential acquisitions of new projects. The company's current debt, including that from Hira Group, is around ₹200 crores, with a cost of debt at approximately 12%.

Long-Term Vision and Resource Potential

Deccan Gold aims to become a mid-tier gold producer and a supplier of critical minerals by 2030. The company projects its share of gold production to reach around 2 tons, with an additional 2.5-3 tons from other critical minerals (nickel, copper, lithium), totaling 5-5.5 tons of gold equivalent. The Altyn Tor mine life is expected to extend to at least 15 years with underground operations, significantly longer than the initial 6-year estimate for the first stadium project.

Shareholding and Project Prioritization

Management addressed concerns about the reduction of Deccan Gold's stake in the Jonnagiri project from 42% to 27%. This was attributed to prioritizing investments in the Kyrgyzstan project, where Deccan holds a controlling 60% stake, to ensure a major shareholder position. While ₹40 crores were invested in Jonnagiri, ₹140-150 crores were invested in Kyrgyzstan, reflecting a strategic shift towards projects with majority ownership and higher control.

ESG Commitment and Shareholder Engagement

Deccan Gold reiterated its commitment to ESG standards, aiming for complete ESG compliance from next year onwards. The company also announced plans to hold 100% physical Annual General Meetings (AGMs) from next year, addressing shareholder requests for more direct engagement. Management acknowledged past delays in communication but pledged to improve regular investor relations calls and information dissemination.

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