JSW Energy — Q3 FY26 earnings call

Call held 23 Jan 2026

Management summary

JSW Energy reported strong Q3 FY26 results with significant revenue and EBITDA growth, driven by substantial capacity additions and improved operational performance. The company is well on track to meet its ambitious 2030 capacity targets, securing new PPAs and commissioning green hydrogen and renewable projects. While facing challenges from flattish power demand and increased debt, management highlighted strategic de-risking, reduced receivables, and declining cost of debt, maintaining a positive outlook for future growth.

Highlights

  • Revenue increased by 61% YoY to ₹4,255 crores, driven by robust capacity additions and generation.

  • EBITDA grew by 98% YoY to ₹2,202 crores for the quarter.

  • Profit after tax (PAT) was up 150% to ₹420 crores, and cash profits increased by 12% YoY to ₹570 crores.

  • Total installed capacity reached 13.3 GW, a 64% YoY increase, with 125 MW added in Q3 FY26.

  • Secured 18.7 GW of incremental generation capacity and 29.6 GWh in storage, progressing towards 30 GW generation and 40 GWh storage targets by 2030.

  • Cost of debt declined by 11 basis points QoQ from 8.79% to 8.68%.

  • Receivables reduced significantly to 73 debtor days from 96 days in the prior fiscal.

Concerns

  • Power demand growth was flattish at 0.5% YTD Dec 2025, primarily due to weather-led phenomena.

  • Depreciation more than doubled and interest cost jumped by almost 2.6 times YoY in Q3 FY26 due to capitalization of newer assets.

  • Net debt increased to ₹63,771 crores from ₹61,960 crores in Q2 FY26.

  • Regulatory approval for FDRE IV is still pending, causing delays in project execution.

  • Subdued merchant market environment with declining day-ahead prices, though the company maintained a 20% premium.

Key financials

  1. Revenue ₹4,255 Cr +61%YoY
  2. EBITDA ₹2,202 Cr +98%YoY
  3. PAT ₹420 Cr +150%YoY
  4. Cash Profits ₹570 Cr +12%YoY
  5. Cost of Debt 8.7% -0.11%QoQ
  6. Debtor Days 73 days

What they filed

Q1 FY27: revenue up 20.2%, net profit up 16.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue967 977 946 916 780 −19%695 −29%639 −32%1,101 +20%
EBITDA250 305 277 303 259 +4%244 −20%209 −25%296 −2%
Net profit286 217 464 162 190 −34%65 −70%442 −5%188 +16%
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.

Order book

high confidence

Total value

32.1 GW

as of 2025-12-31 quantified

Inflow this quarter

1,600 MW

Execution

Salboni 3.2 GW by 2030-31, KSK 1.8 GW in ~3 years

Composition

Mix 4 technologies
  • Generation Capacity 18.7 GW 26.1%
  • Storage Capacity 29.6 GWh 41.3%
  • Contracted RE Capacity 12.6 GW 17.6%
  • Secured Thermal Capacity 10.7 GW 14.9%

Share of order book by technology, derived from disclosed amounts

Pipeline

L1 awaiting loa

Pipeline of LOAs pending PPA signing

The company has a robust growth pipeline with significant locked-in capacity in both generation and storage, well on track to meet its 2030 targets despite some moderation in overall bidding activity.

Source: Prepared remarks

Capital allocation

high confidence
  • Capex Capex disclosed
    • Salboni Thermal Project Phase 1 (2x800 MW) ₹16,000 Cr
    And also in terms of the capex - we will be announcing, but yes, you can benchmark - whatever we have said in the domain is that the Phase 1 about 16,000 crores of investment for 2 *800 MW which we have announced earlier, so we'll be around that number only.
  • Debt Net ₹63,771 Cr · 4.9× EBITDA Cost 8.7%
    • Rate reset Cost of debt declined by 11 basis points quarter on quarter from 8.79% to 8.68%.
    Turning to leverage, net debt at the end of the quarter stood at 63,771 crores, up from ₹61,960 crores as on September 30, 2025. Excluding Capital Work in progress debt, the pro forma leverage ratio stands at approximately 4.9x.
  • M&A Tidong Hydro Power Acquisition · Progressing well
    On the inorganic growth front, the acquisitions announced in the previous quarter -Tidong Hydro Power and GE Power India's Boiler Manufacturing division are progressing well.
  • M&A GE Power India's Boiler Manufacturing division Acquisition · Progressing well

    Strengthening supply-chain certainty and mitigating risks for critical equipment.

    On the inorganic growth front, the acquisitions announced in the previous quarter -Tidong Hydro Power and GE Power India's Boiler Manufacturing division are progressing well.
  • M&A Raigarh Champa Rail Infrastructure Private Limited Acquisition · Pending regulatory

    Provides rail infrastructure to KSK plant.

    Further, we have also received the NCLT approval in relation to the Resolution Plan submitted by the Company for Raigarh Champa Rail Infrastructure Private Limited, which provides rail infrastructure to our KSK plant.
  • Liquidity Cash ₹7,100 Cr Sufficient cash flow and free cash to take care of going forward capex.
    Further, our Liquidity remains strong, supported by cash and cash equivalents of over ₹7,100 crores.

Guidance & targets

Capacity

  • Generation Capacity Target Capacity · by 2030 · High confidence 30 GW
    installed capacity beyond our stated target of 30 GW in generation while we are confident of achieving our 40 GW hour in storage by 2030.

    — Sharad Mahendra

  • Storage Capacity Target Capacity · by 2030 · High confidence 40 GWh

    — Sharad Mahendra

  • Open Capacity Reduction Capacity · from April 1, 2026 · High confidence 5%

    From 8% today

    Currently, our open capacity stands at approximately 8%, which will further reduce to around 5% from April 1, 2026, following the securing of a 400 MW 25-year PPA for our Utkal plant with Karnataka discoms.

    — Sharad Mahendra

Capacity Addition

  • H2 FY26 Capacity Addition Capacity Addition · H2 FY26 · High confidence 1.5 GW
    we will be meeting the guidance what we have given for 1.5 GW in second half of current fiscal.

    — Sharad Mahendra

Project Commissioning

  • Salboni Thermal Project (3.2 GW) Project Commissioning · 2030-2031 · High confidence 3.2 GW
    And just to add the Salboni project of 3,200 MW will come up in 2030 and '31.

    — Bikash Chowdhury

  • KSK 1.8 GW Commissioning Project Commissioning · within 3 years · Medium confidence 1.8 GW
    And now very soon, the entire work will start. And we expect in about 3 years' time, we should be in a position to commission this.

    — Sharad Mahendra

  • GE Boiler Manufacturing Plant Acquisition Project Commissioning · June or July of '26 · High confidence Acquisition complete
    See, yes, as we have announced earlier, the GE boiler manufacturing plant in Durgapur which we are in the process of acquiring, and we expect the process to be completed and the plant to be fully with us by June or July of '26.

    — Sharad Mahendra

  • BESS Plant Production Start Project Commissioning · February-March · High confidence Production start
    But by the time, we will start the production sometime in February -- between February-March.

    — Sharad Mahendra

What to watch in Q4 FY26

H2 FY26 Capacity Addition Target

next quarter (end of FY26)
Current 125 MW commissioned in Q3 FY26
Target 1.5 GW total commissioned for H2 FY26

Why it matters

Verifies the company's execution capability and progress towards its annual capacity targets, directly impacting future generation and revenue.

And in the current quarter, the capacity additions, which are going to take place, we will be meeting the guidance what we have given for 1.5 GW in second half of current fiscal.

Risks & concerns

  • Flattish Power Demand Growth

    medium

    Overall power demand growth stood at a modest 0.5% year on year until December 2025, primarily due to weather-led phenomena.

    Management acknowledged

  • Increased Depreciation and Interest Costs

    medium

    Depreciation more than doubled and interest cost jumped by almost 2.6 times YoY in Q3 FY26 due to the capitalization of newer assets.

    Management acknowledged

  • Subdued Merchant Market Environment

    medium

    The merchant power market remained soft, with day-ahead prices declining sequentially and YoY, though the company maintained a 20% premium.

    Management acknowledged

  • Moderation in Bidding Activity and Grid Connectivity Challenges

    medium

    Bidding momentum has been mixed, and there are uncertainties regarding fresh connectivity for new projects from FY27 onwards, potentially slowing down new bidding.

    Management acknowledged

  • Tariff Reduction for KSK Mahanadi

    medium

    A tariff reduction of approximately ₹1.25 for 1000 MW of KSK capacity is expected from FY27, which will have some impact on EBITDA, though management expects it to be minimal due to operational efficiencies.

    Management acknowledged

  • Regulatory Delays for FDRE IV

    medium

    Regulatory approval for the FDRE IV project is still pending, despite the PPA being signed, which could delay its contribution.

    Management acknowledged

  • Curtailment due to Evacuation Constraints

    low

    Curtailment, particularly in Rajasthan due to evacuation constraints, has a negligible financial impact on the company, and new evacuation connectivity has recently reduced it.

    Management downplayed

Q&A highlights

6 direct, 1 evasive
Salboni Project PPA Details and Capex Direct
The PPA timelines, which are there is from the date of notice to proceed. It's 48 months for the first unit of first phase and second unit after another 6 months, that is 54 months. So all the planning is within the same timelines. We will definitely be completing the Phase 1 within the PPA timelines, which are there. ... Phase 1 about 16,000 crores of investment for 2 *800 MW which we have announced earlier, so we'll be around that number only.

Clarifies the timeline and significant capital expenditure for the large Salboni thermal project, providing visibility on future asset base.

Asked by Sumit Kishore

RE Capacity Commissioning and Grid Constraints Direct
as we have said earlier, you rightly said that 1.5 GW of fresh capacity addition during H2 of current fiscal, out of which 125 MW we have commissioned during quarter 3. So we are well on track. And in the current quarter, the capacity additions, which are going to take place, we will be meeting the guidance what we have given for 1.5 GW in second half of current fiscal.

Confirms the company is on track with its H2 FY26 capacity addition targets despite broader grid constraints, highlighting effective project execution and connectivity management.

Asked by Sumit Kishore

Utkal PPA Tariff Structure Direct
See, this 400 MW is the net capacity, one. And this is a tariff at 5.8 at my plant bus. ... No, no, this is a fixed tariff of ₹5.8. Of course, scalable, but this 5.8 tariff is the year 1 tariff, which we are going to get from Karnataka. It is a single tariff. It is fixed plus variable, single tariff bidding, which is there.

Provides specific tariff details for the new 400 MW PPA with Karnataka, crucial for revenue visibility and profitability of the Utkal plant.

Asked by Mohit Kumar

LOA to PPA Conversion Progress Partial
Yes, that is about see, there is a total capacity, which is there is about 4.5 GW for which there is pendencies. And some we are expecting shortly to get signed and others, we are waiting, but keeping in mind that our contracted capacity and the PPA signed capacity, the gap is such that we are absolutely certain, the 30 GW number what we are telling by 2030, that is on track.

Addresses the status of the 4.5 GW pipeline of LOAs, indicating some delays but reiterating confidence in achieving the 30 GW target by 2030.

Asked by Mohit Kumar

Impact of KSK Mahanadi Tariff Reduction Direct
going forward in FY '27 as per the PPA terms, there will be a tariff reduction of close to about 1.25 from one of the DISCOMs, so that will definitely have some impact, but operational efficiencies, as I've said earlier, during the year, we have been building up a lot of operational efficiencies and which have come during the year and kept on coming, so that will give us annualized benefit next year.

Acknowledges a tariff reduction for 1000 MW of KSK capacity from FY27 but mitigates concerns by highlighting operational efficiencies to offset the impact.

Asked by Rajesh Majumdar

BESS Containerization and Cell Assembly Plant Commissioning Direct
Yes, exactly. Yes, we are doing that only. ... we have placed for some and the materials will start coming because the trial production plant is stabilized. We have submitted our product for necessary approvals, which we expect by March end or early April the approvals to be in place. But by the time, we will start the production sometime in February -- between February-March.

Confirms the strategy of importing cells and containerizing them, with production expected to start soon, indicating progress in a new strategic area for the company.

Asked by Apoorva Bahadur

FDRE IV Regulatory Approval Status Evasive
That battery thing. See, we are waiting for the regulatory approval for the FDRE. We have received the letter. We're waiting for regulatory approval. That is the state. There is no further communication to us from Rajasthan on this.

Highlights an ongoing regulatory delay for the FDRE IV project, which could impact its commissioning timeline and contribution.

Asked by Satyadeep Jain

Curtailment and Wind PLF Direct
See, the curtailment, which is there, we have to understand that, again, because of the evacuation constraints and especially being witnessed majorly in the state of Rajasthan. ... The impact on us is negligible right now. And the positive which has happened, just maybe a week or 10 days back, the new evacuation this connectivity has got started. With this, the curtailment has significantly reduced, which has benefited us also from the temporary grid-connected portfolio.

Provides context on grid curtailment issues in Rajasthan and reassures that the financial impact is minimal, with recent improvements in evacuation connectivity.

Asked by Nikhil

2 min read 6 chapters

Detailed narrative

Strong Q3 FY26 Financial Performance

JSW Energy delivered robust financial results in Q3 FY26, with revenue increasing by 61% year-on-year to ₹4,255 crores. This growth was mirrored in EBITDA, which surged by 98% YoY to ₹2,202 crores. Profit after tax (PAT) saw an impressive 150% increase to ₹420 crores, while cash profits grew 12% YoY to ₹570 crores, demonstrating strong operational leverage and profitability.

Significant Capacity Expansion and Pipeline Visibility

The company's installed capacity reached 13.3 GW, marking a 64% YoY growth, with 125 MW of new renewable capacity added in Q3 FY26. JSW Energy has locked in 18.7 GW of incremental generation capacity and 29.6 GWh in storage, putting it on track to exceed its 30 GW generation and 40 GWh storage targets by 2030. Key additions include a 400 MW 25-year PPA for the Utkal plant and a second 1,600 MW PPA for the Salboni thermal project, bringing the total secured thermal capacity to 10.7 GW and overall locked-in capacity to 32.1 GW.

Strategic Acquisitions and Supply Chain Strengthening

Progress on inorganic growth is evident with the Tidong Hydro Power and GE Power India's Boiler Manufacturing division acquisitions advancing well. The GE boiler plant acquisition, expected to close by June or July 2026, is strategic for strengthening supply chain certainty and mitigating risks for critical equipment. Additionally, NCLT approval for Raigarh Champa Rail Infrastructure Private Limited will provide crucial rail infrastructure for the KSK plant.

Debt Management and Liquidity

Net debt increased to ₹63,771 crores from ₹61,960 crores in Q2 FY26, with a pro forma leverage ratio (excluding CWIP) of approximately 4.9x. However, the company successfully reduced its cost of debt by 11 basis points quarter-on-quarter to 8.68%. Liquidity remains strong, supported by cash and cash equivalents of over ₹7,100 crores, which management believes is sufficient to cover future capex requirements.

Green Initiatives and Innovation

JSW Energy successfully commissioned India's largest green hydrogen plant at its Vijayanagar location, with a capacity of 3,800 tonnes per annum, marking a significant milestone in its decarbonization journey. The company's expanding renewable portfolio helped avoid approximately 14-15 million tonnes of CO2 emissions in the first nine months of the fiscal. Plans are also underway for a BESS containerization and cell assembly plant, with production expected to commence in February-March 2026.

Market Dynamics and Regulatory Environment

The quarter saw flattish power demand growth (0.5% YTD Dec 2025) due to weather, but December and January showed robust growth of 6-6.5%. The merchant power market remained soft, though JSW Energy achieved a 20% premium on realizations. Bidding momentum for new capacity has been mixed, with a shift towards a balanced mix of thermal, storage, and firm power solutions. Regulatory approval for the FDRE IV project is still pending, posing a potential delay.

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