Detailed Narrative
Q4 & FY26 Performance Overview
GIPCL reported its Q4 and full-year FY26 results, with the solar division's EBITDA for FY26 at ₹332 crores and PBT at ₹62 crores. The RE division's revenue for FY26 included ₹152 crores from solar, ₹86 crores from wind, ₹38 crores from 75MW solar, and ₹111 crores from Khavda. Thermal lignite plants (SLPP 1 & 2) maintained high PLFs, exceeding 75% and 80% respectively, contributing ₹1,030-1,103 crores in revenue.
Khavda Solar Project (600 MW) Outlook
The 600 MW Khavda solar project is currently operating at a CUF of 33.24% and is projected to generate approximately ₹420 crores in revenue and ₹350-360 crores in EBITDA for FY27. Management noted that power evacuation for this specific project is at full capacity, despite broader grid congestion issues in the Khavda region. The Power Purchase Agreement (PPA) for this project is in place for 25 years, ensuring long-term revenue visibility.
Strategic Shift to Battery Energy Storage Systems (BESS)
Acknowledging the unlikelihood of reviving gas-based power plants due to geopolitical factors, GIPCL is repurposing its existing gas-based station locations for BESS projects. The first phase involves a 20/120 MW BESS with a tender already in place, and a second 30/160 MW BESS is planned for the coming year. The capex for the BESS projects is estimated at ₹250-300 crores, with full operational capacity expected within one year, and a revenue model around ₹6 per unit.
Significant Capacity Expansion Plans
GIPCL has received in-principle approval for a 750 MW thermal lignite-based power station expansion, requiring an estimated capex of ₹6,000-7,000 crores, with commissioning targeted in phases by FY31, FY32, and FY33. Additionally, the company plans to add another 200-300 MW of solar capacity in the next couple of years, including a specific 200 MW project at Khavda with an estimated capex of ₹800-1,000 crores, expected to be commissioned in the next few months⏳.
Financial Projections and Debt Profile
The company projects its total EBITDA to reach ₹950-1,000 crores in FY27, assuming the remaining 500 MW Khavda capacity becomes operational. However, interest costs are expected to double from ₹107-110 crores to ₹250-260 crores and depreciation to increase from ₹187 crores to ₹425-450 crores in FY27 due to new capacity additions. The company's peak debt, including the thermal expansion, is projected to be around ₹6,000-6,500 crores, with the current average cost of debt at 7.8% (floating).
RE Park Developer Role and Transparency
As a park developer, GIPCL manages a 2,375 MW park, with 1,100 MW for its own use and the rest allocated to third parties. The company expects to generate ₹50-60 crores in O&M revenue from this role, with a net revenue of ₹20-25 crores over a 25-year period. In response to analyst requests, management committed to exploring the possibility of publishing Plant Load Factor (PLF) data on stock exchanges from the next quarter onwards to enhance transparency.