SJVN Limited

SJVN demonstrated robust operational performance in FY25, with total generation increasing by 25.44% year-over-year to 10,647 million units. This growth was primarily driven by its flagship Nathpa Jhakri Hydro Power Station, which generated 7,421.45 million units, an 17.57% increase from the previous year. The company also made significant progress in capacity expansion, commissioning 320 MW of the 1000 MW Bikaner Solar Power project, with the remaining 680 MW targeted for commissioning by October 2025. Additionally, the foundation stone was laid for the 100 MW Nava Solar Power project, expected to generate 254 million units annually.

SJVN has a substantial under-construction project portfolio totaling 4601 MW, comprising 4 hydro, 1 thermal, and 11 solar projects. The company has successfully secured Power Purchase Agreements (PPAs) for 5.188 GW of capacity, with 3 GW of these PPAs signed in FY25 alone. Management confirmed that 100% of its renewable projects have secured PPAs through competitive bidding, ensuring revenue visibility. For hydro projects, PPAs are based on a cost-plus model, indicating a secure off-take strategy for its expanding capacity.

The company reported a capex of approximately INR 7,800 crores for FY25. Looking ahead, SJVN has ambitious capex targets of INR 8,300 crores for FY26 and INR 12,000 crores for FY27, primarily directed towards its under-construction hydro, thermal, and solar projects. While most of the debt for current projects is already tied up, the company anticipates potentially raising an additional INR 2,000 crores in FY26 if required to fund ongoing project development.

SJVN recorded an impairment loss of INR 143 crores in Q4 FY25, which management attributed to the cyclical nature of the solar business and actual energy generation falling below design expectations. This was noted as an accounting compulsion with potential for reversal in the future. The company also experienced a nearly 50% decline in other income during Q4 FY25, a consequence of deploying capital from fixed deposits into its extensive pipeline of under-construction projects. An ongoing court case with the Himachal Pradesh government regarding certain projects was acknowledged, with management asserting that construction continues and costs would be reimbursed with interest if the state takes over the projects.

Significant progress is being made on the Italian hydroelectric project in Arunachal Pradesh. The company expects to receive FC1 forest clearance next month, followed by environment clearance by August/September. Land acquisition is anticipated to be completed by the end of June, with investment approval from the Cabinet Committee by September/October. These milestones are critical for the project, with construction expected to commence by the end of the year, contributing to SJVN's long-term hydro capacity.