SJVN Limited — Q2 FY26 earnings call

Call held 10 Nov 2025

Management summary

SJVN Limited reported significant operational progress in Q2 FY26, with key projects like Buxar Thermal Unit 1 nearing COD and substantial renewable capacity additions underway. Despite a 6.3% increase in H1 generation, revenue growth was muted due to operational challenges from natural calamities and increased costs. The company maintains an aggressive capex plan for FY26 and FY27, but faces hurdles in PPA finalization and grid connectivity for its large renewable pipeline, alongside managing a growing debt profile.

Highlights

  • Unit 1 of 60 MW Buxar Thermal Power Project virtually inaugurated on August 22, 2025, with COD expected within 1-2 days of the call.

  • Commercial operation date for cumulative capacity of 680 MW under the 1,000 MW Bikaner solar project has been achieved in phases.

  • Total generation for H1 FY26 increased by 6.3% to 9,442 million units compared to the previous year.

  • Power Purchase Agreements (PPAs) signed for 1,490 MW from Arun-III, Luhri Stage-I, and Sunni Dam Hydroelectric Projects.

  • FY26 capex target of INR 7,500 crores, with INR 3,600 crores already spent in H1, indicating strong execution.

Concerns

  • Revenue for Q2 FY26 was comparable to Q2 FY25 despite new capacity additions, attributed to lower plant availability factor (due to floods/silt), increased tax expenses (80 IEA benefit expiry), and higher finance/depreciation costs.

  • Grid connectivity and transmission line shortages are delaying commissioning of new Renewable Energy (RE) projects and PPA signing for awarded LOAs (13.74 GW LOAs issued, but only 3.74 GW PPAs signed).

  • Total debt is approximately INR 30,000 crores, raising analyst questions about debt-to-equity ratio and servicing capacity.

Key financials

5 periods

Headline

  • Incentive Income
    ₹104.45 Cr
  • Finance Cost Increase (YoY)
    ₹50 Cr
  • Lower Bank Interest Income (YoY)
    ₹26 Cr
  • Decrease in Late Payment Surcharge (YoY)
    ₹17 Cr

Q2 FY25

  • Depreciation
    ₹133 Cr

Q2 FY26

  • Depreciation
    ₹171 Cr
    YoY +28.6%

H1 FY25

  • Total Generation
    880 million units

H1 FY26

  • Total Generation
    9,442 million units
    YoY +6.3%

What they filed

Q1 FY27: revenue up 52.0%, net profit down 1.3% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue1,026 671 504 917 1,032 +1%1,082 +61%1,496 +197%1,394 +52%
EBITDA828 464 241 707 860 +4%773 +67%910 +278%850 +20%
Net profit440 149 -128 228 308 −30%224 +50%-118 +8%225 −1%
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

5,091 megawatt

as of 2025-09-30 quantified

Composition

Mix 3 technologies
  • Hydro Projects 30.6%
  • Thermal Project 25.9%
  • Solar Projects 43.5%

Share of order book by technology

Pipeline

L1 awaiting loa

LOAs issued for capacity

The company has a significant under-construction portfolio and a large pipeline of awarded LOAs, but faces challenges in converting LOAs to PPAs due to grid connectivity and transmission issues.

Source: Prepared remarks

Capital allocation

high confidence
  • Capex ₹7,500 Cr
    total capex which we have kept is around INR7,500 crore and out of that we have already spent in two quarters around INR3,600.
  • Debt Gross ₹30,000 Cr
    debt levels are increasing, right? I mean, we are at INR30,000 crore odd total for now

Guidance & targets

Capacity

  • Buxar Thermal Power Project Unit 1 (660 MW) COD Capacity · within 1-2 days (from Nov 10, 2025) · High confidence Commercial operation
    we will be I think declaring within may be today itself may be in the evening itself or may be tomorrow max we will be declaring the commercial operation date for the unit 1

    — Bhupender Gupta

  • Buxar Thermal Power Project Unit 2 (660 MW) COD Capacity · January or February 2026 · High confidence Commercial operation
    we are targeting the COD of this second unit also during the January or February next year.

    — Bhupender Gupta

  • Bikaner Solar Power Project (320 MW) commissioning Capacity · December 2025 · High confidence Commissioned
    Bikaner is coming around 320 megawatt that will be commissioned in next month itself 320 megawatt.

    — Bhupender Gupta

  • Total Solar capacity commissioning Capacity · FY26 · High confidence ~650 MW
    like this around 650 megawatt of RE, Renewable Energy Projects, Solar Projects specifically will be commissioned during this financial year.

    — Bhupender Gupta

  • Dhaulasidh Hydro Project (66 MW) commissioning Capacity · December 2026 · High confidence Commissioned
    we will be commissioning one small project definitely, it's around 66 megawatt that is Dhaulasidh, that we will be commissioning next year around December 2026.

    — Bhupender Gupta

Generation

  • Buxar Thermal Power Project annual generation Generation · Annually (once fully commissioned) · High confidence 9826.72 million units
    once this plant is commissioned fully, it will be generating around 9826.72 million units annually

    — Bhupender Gupta

PPA Signing

  • PSA/PPA for awarded LOAs PPA Signing · next two months · Medium confidence ~3.75 GW
    we are expecting around the same quantity of PSA, PPA in next two months, 3.75.

    — Bhupender Gupta

Capex

  • FY26 Capex Capex · FY26 · High confidence INR 7,500 crores
    total capex which we have kept is around INR7,500 crore

    — Bhupender Gupta

  • FY27 Capex Capex · FY27 · High confidence INR 8,000 crores
    As far as next year is concerned, '26-'27, we have kept a capex of around INR8,000 crore for the next year.

    — Bhupender Gupta

  • FY28 Capex Capex · FY28 · Medium confidence Similar range as FY27
    Yes, it's actually we are just consolidating our present portfolio and our one of the big project is Buxar which was basically capex driven so that is now going to be completed this year. So now we will be focusing on some new projects in Nepal which will be like we will be awarding the contract something maybe in the second quarter of next year.

    — Bhupender Gupta

What to watch in Q3 FY26

Buxar Thermal Power Project Unit 1 COD declaration

Next quarter (within 1-2 days of Nov 10, 2025)
Current Full load operation completed, declaration pending
Target Commercial Operation Date declared

Why it matters

Marks the start of revenue generation from a major thermal project, crucial for financial performance.

we will be I think declaring within may be today itself may be in the evening itself or may be tomorrow max we will be declaring the commercial operation date for the unit 1

Risks & concerns

  • Grid connectivity and transmission line shortages

    high

    A major issue delaying commissioning of new RE projects in Rajasthan and Gujarat, with connectivity delays of 28-31 months, impacting project timelines.

    Management acknowledged

  • Delays in PPA signing for awarded LOAs

    high

    Out of 13.74 GW of LOAs issued, only 3.74 GW of PPAs have been signed, with clarity on the remaining ~9 GW expected in 1-2 months, potentially leading to re-bidding.

    Management acknowledged

  • Declining Plant Availability Factor (PAF) due to natural calamities

    medium

    Floods and high silt in the Himalayas affected Rampur and Nathpa Jhakri plants, leading to shutdowns and an estimated revenue loss of INR 50-60 crores.

    Management acknowledged

  • Increasing debt levels

    medium

    Total debt stands at approximately INR 30,000 crores, but management is confident in servicing it with cash flows from new projects like Buxar.

    Analyst acknowledged

Q&A highlights

6 direct
Incentive income for Q2 FY26 Direct
Incentive income for the half year, current half year it is INR104.45 crores.

Provides a specific financial metric for the half-year, indicating a component of non-operating income.

Asked by Ragini

Progress on 5 GW Hydroelectric Projects in Arunachal Pradesh (Etalin, Attunli) Partial
In the 5 gigawatts, actually, there are five projects, in fact. And out of that five projects, three are still under PFR stage... But regarding the two other projects, which one is the biggest hydro project in India, that is 3,097 megawatt, Etalin, and other is this around 688 megawatt, Attunli. So, these two are progressing well.

Clarifies the status and timelines for significant future hydro capacity, highlighting land acquisition and environmental clearances as key hurdles for Etalin and Attunli.

Asked by Ragini

Revenue not increasing despite new projects and higher depreciation/finance costs Direct
There are three, four major reasons why this income has come down. One is this decrease in energy charges means actually generation we have increased, but there is a concept of plant availability factor... So this time there was a lot of flood, in the Himalayas... So we had to close the plant due to the high silt in the water... we have lost almost INR50 crores to INR60 crores.

Explains the discrepancy between capacity additions and revenue growth, attributing it to operational issues (floods/silt affecting plant availability) and regulatory factors (80 IEA benefit expiry).

Asked by Paras Chheda

Buxar plant commissioning and average PPA price for solar projects Direct
regarding Buxar, as I told earlier, that we are going to declare the commercial operation of the plant within one or two days... So first unit is 660 megawatt... Average tariff is around INR2.60 paisa for these all the solar grids if you see...

Confirms the imminent commissioning of Buxar Unit 1 and provides tariff expectations for solar projects, which are a growing part of SJVN's portfolio.

Asked by Paras Chheda

Significant upcoming RE projects for revenue capacity Direct
Renewable side Bikaner is coming around 320 megawatt that will be commissioned in next month itself 320 megawatt. Then Jamui we have one plant in Bihar that is 75 megawatt. Then another 120 megawatt in Assam that will be commissioned within this financial year. Then Bagodara 35 megawatt in Gujarat and another 100 megawatt in Nawa... So like this around 650 megawatt of RE... will be commissioned during this financial year.

Details the specific renewable energy projects expected to come online in FY26, providing clarity on future revenue-generating assets.

Asked by Paras Chheda

Debt levels and debt-to-equity ratio Direct
debt levels are increasing, right? I mean, we are at INR30,000 crore odd total for now... we don't see that there will be very large increase in the loan portion in the next two years, and we'll be able to service our loans out of the cash generated from Buxar.

Addresses concerns about rising debt, with management expressing confidence in servicing it through cash flows from newly commissioned projects like Buxar.

Asked by Paras Chheda

PPA signing delays for awarded LOAs and potential re-bidding Partial
That is we are still into the stakeholder consultation frankly speaking in this regard... So it will take some time, one or two months, and after two months there will be more clarity that what is going to happen for these LOAs where PPAs are not getting signed.

Highlights a significant industry-wide and company-specific challenge regarding grid connectivity, transmission, and PPA finalization, impacting project execution and future revenue visibility for a large portion of the pipeline.

Asked by Bharani, Shubham Shelar

REIA target achievement Direct
As far as my portfolio is concerned for REIA, I will meet my target whatever given to me by the government.

Reaffirms management's commitment to government-assigned renewable energy targets despite the broader industry challenges in project execution and PPA finalization.

Asked by Bharani

3 min read 5 chapters

Detailed narrative

Q2 FY26 Operational Highlights and Commissioning Progress

SJVN Limited reported significant operational milestones in Q2 FY26. Unit 1 of the 60 MW Buxar Thermal Power Project was virtually inaugurated on August 22, 2025, and is expected to declare Commercial Operation Date (COD) within 1-2 days of the call. The cumulative 680 MW capacity under the 1,000 MW Bikaner solar project has also achieved COD in phases. The company's total operational capacity now stands at 3,146 MW, with an additional 320 MW from Bikaner expected to be commissioned by December 2025.

Generation Performance and Revenue Headwinds

For the first half of FY26, total generation from all power stations reached 9,442 million units, reflecting an improvement of about 562 million units or 6.3% compared to the corresponding period of 2024-2025 (which was stated as 880 million units, likely a typo for 8,880 million units). Despite this growth and capacity additions, Q2 FY26 revenue was comparable to Q2 FY25. This was primarily due to a decrease in energy charges from a lower plant availability factor, resulting in an estimated loss of INR 50-60 crores, caused by floods and high silt affecting hydro plants like Rampur and Nathpa Jhakri. Additionally, increased tax expenses (due to 80 IEA benefit expiry) and higher finance costs (up ~INR 50 crores) impacted profitability.

Capex and Debt Management

SJVN has outlined an aggressive capital expenditure plan, with INR 3,600 crores already spent in the first two quarters of FY26 against a full-year target of INR 7,500 crores. The company projects a capex of INR 8,000 crores for FY27, with a similar range expected for FY28. The total debt currently stands at approximately INR 30,000 crores. Management expressed confidence in servicing this debt, anticipating that cash generated from the newly commissioned Buxar project will contribute significantly to debt repayment over the next two years.

Renewable Energy Pipeline and PPA Challenges

The company has floated tenders for 19.8 GW of renewable capacity and issued Letters of Award (LOAs) for 13.74 GW. Power Purchase Agreements (PPAs) have been executed for 3.74 GW, with an additional 3.75 GW expected to be signed in the next two months. However, a significant challenge remains with approximately 9 GW of LOAs for which PPAs are yet to be signed. This delay is attributed to issues with grid connectivity and transmission line shortages, particularly affecting projects in Rajasthan and Gujarat. Management is engaged in stakeholder consultations, with clarity on the path forward for these unsigned PPAs expected within 1-2 months.

Future Capacity Expansion and Project Development

SJVN's total under-construction portfolio stands at 5,091 MW, comprising 1,558 MW hydro, 1,320 MW thermal, and 2,213 MW solar projects. Beyond the imminent Buxar and Bikaner commissionings, the company plans to commission approximately 650 MW of solar capacity in FY26, including projects in Jamui (75 MW), Assam (120 MW), Bagodara (35 MW), and Nawa (100 MW). Major hydro projects like Etalin (3,097 MW) and Attunli (688 MW) in Arunachal Pradesh are progressing, with Etalin in the final stages of land acquisition. Additionally, the Dhaulasidh Hydro Project (66 MW) is targeted for commissioning by December 2026.

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