Detailed Narrative
Q2 FY26 Financial Performance and Net Worth Improvement
GE Power India Limited reported a robust Q2 FY26, with revenue growing by 29.5% year-on-year to INR 281 crores, primarily driven by core services. Profit Before Tax (PBT) saw a significant increase to INR 33 crores, up from INR 8 crores in the corresponding quarter of the previous year. The company's net worth also improved to INR 298 crores as of September 30, 2025, from INR 233 crores on March 31, 2025, reflecting effective cash management and financial prudence.
Order Book Dynamics and Core Services Growth
While the overall order backlog decreased by 31.4% to INR 1,825 crores as of September 30, 2025, largely due to the termination of two FGD EP contracts worth INR 775 crores, the core order intake demonstrated strong momentum. Core orders for the current quarter increased by 45% to INR 162 crores from INR 112 crores in the September 2024 quarter, indicating a healthy demand in the company's strategic focus areas. Management noted that on an 'apple-to-apple' comparison, core order intake was up 18%.
Strategic Settlements and Durgapur Demerger
The company successfully settled significant financial exposures, including an amicable resolution with BHEL for INR 340 crores in outstanding receivables, with INR 50 crores already received in October. A dispute with JP Venture Power Limited was also settled, resulting in a INR 27 crores charge on the P&L, with an expected recovery of INR 25 crores. Furthermore, the demerger of the Durgapur undertaking to JSW Energy became effective July 1, 2025, securing a 5-year contract for GEPIL to access manufacturing services for boilers and mills.
Focus on High-Margin Core Services and Export Expansion
GEPIL is strategically focusing on high-margin, shorter-cycle core services, which now constitute approximately 55% of its gross margin. This segment encompasses spare parts supply, in-house repair capabilities, and overhauling/maintenance. The company has also made strides in international expansion, penetrating 7 countries and securing INR 4 crores in boiler spare orders, with plans to further ramp up these export opportunities.
Broader Power Sector Context and Regulatory Landscape
India's power consumption grew 3.2% year-on-year to 146 billion units in September 2025, with cumulative H1 FY26 growth at 4%. Peak power demand reached 229 gigawatts. The Ministry of Environment and Forest revised its notification, limiting flue gas desulfurization (FGD) installation to about 30 gigawatts of thermal power plants by December 2027 and 2028, while excluding 70 gigawatts of Category C plants from this policy.