VEDPOWER Q2 FY27 Earnings Call: Posts First Positive EPS, Net Debt/EBITDA Halves To 4.47x

VEDPOWER held its Q2 FY27 earnings call on October 29, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Record Quarter with First Positive EPS

• Revenue of Rs.2,908 crore, +38% YoY (vs Rs.2,104 crore in Q2 FY26), driven by 26% volume growth to 5,593 million units and NSR improvement to Rs.5.2/kWh from Rs.4.7/kWh in Q2 FY26.
• EBITDA of Rs.421 crore, +122% YoY (vs Rs.192 crore in Q2 FY26) and +45% QoQ vs Rs.291 crore in Q1 FY27; PAT before exceptional items was Rs.101 crore vs a loss of Rs.142 crore in Q2 FY26.
• First positive quarterly EPS of Rs.0.21 per share — reported PAT of Rs.83 crore after exceptional items net of tax of Rs.18 crore.
• Finance cost rose to Rs.200 crore from Rs.172 crore in Q2 FY26, attributed to capitalization at Shakti and Meenakshi.
• H1 FY27 revenue up 35% YoY to Rs.5,515 crore; EBITDA up 17% to Rs.712 crore; PAT before exceptional items of Rs.42 crore vs a loss of Rs.54 crore in H1 FY26.

Broad-Based Gains Across the Portfolio

• Jashipura delivered highest-ever quarterly EBITDA of Rs.478 crore with plant availability of 98% in Q2 FY27 vs 48% in Q2 FY26; includes Rs.58 crore recovery of legacy ash disposal costs following a favorable OERC judgment.
• Meenakshi posted highest-ever quarterly sales of 1,417 million units (+112% YoY) and EBITDA of Rs.101 crore vs Rs.28 crore in Q2 FY26; domestic coal was 87% of consumption in Q2 FY27, saving Rs.127 crore versus imported coal.
• Meenakshi unit economics improved post coal migration — realization ~Rs.6/unit against cost of Rs.5/unit (would have been Rs.7/unit on imported coal); CFO confirmed ~Rs.1/kWh dark spread at the ~87% domestic level; Indian coal consumption reached 95% in September 2026 and is nearing 100% as of the call.
• Talwandi Sabo sold 2,945 million units in Q2 FY27; byproduct ash revenue grew from Rs.1.6 crore in Q2 FY26 to Rs.8.7 crore in Q2 FY27.
• Jharsuguda EBITDA was steady in Q2 FY27, supplemented by ~Rs.50-60 crore of legacy matter realization booked during the quarter; sequential consolidated EBITDA growth came from other units including Jharsuguda's best-ever 98% availability.
• Shakti gross sales of ~300 million units in Q2 FY27 came from power purchased at Rs.4/unit and supplied at Rs.7/unit; EBITDA was flattish due to other costs.

Unit 1 Synchronized; Unit 2 Timeline Reaffirmed

• Shakti Unit 1 synchronized to grid on 25 October 2026 after completion of the restoration program; commercial supply began 25 September 2026 (Q2 FY27) with ramp-up underway and minimal time expected since the unit was commissioned and stabilized before the incident.
• Unit 1 currently supplies a medium-term Tamil Nadu tender at Rs.5.5/unit realization, with tie-ups with Maharashtra and other states at improved realization; Shakti cost of generation expected at ~Rs.2.5/unit (Rs.2/unit coal plus Rs.0.5/unit non-coal, period unspecified).
• Unit 2 progress stood at 70% at end of Q2 FY27; commissioning activity to begin by end of Q4 FY 2026-2027 — guidance reaffirmed, management "very confident"; grid synchronization expected around April 2027 (Q1 FY 2027-2028).
• Pending capex for Shakti Units 1 & 2 is ~Rs.1,200 crore, to be spent in H2 FY 2026-2027 with some portion spilling into Q1 FY 2027-2028.
• Unit 2 offtake — medium/long-term sales tie-up possible only after grid synchronization; until then output will be sold on power exchanges in FY 2026-2027, which are fetching better prices amid shortage across India.

Leverage More Than Halved; Ratings Intact

• Net debt reduced to Rs.7,444 crore from Rs.7,704 crore in Q1 FY27; cash and equivalents of Rs.1,063 crore.
• Net debt/EBITDA improved to 4.47x from 9.82x in Q2 FY26; management noted leverage was ~10x last year (FY 2026-2027) when capex was underway but the plant was not operational, and expects ~2x once Unit 2 is operational (FY 2027-2028).
• Credit ratings held at AA- (stable outlook) from both ICRA and CRISIL.
• H2 FY27 priorities — convert operational recovery into sustainable cash earnings, maintain discipline over working capital and finance cost, continue reducing leverage, and deploy growth capital only against projects with secure offtake and appropriate returns.

Brownfield First, DBFO Tenders, 13 GW Ambition

• ~74% of capacity tied up under long-term PPAs (as of Q2 FY27); strategic focus on securing 85-90% of capacity under long/medium-term PPAs (period unspecified) while retaining short-term market flexibility, which management views as favorable given the power shortage across India.
• UP tender bid of 1,600 MW (2 units of 800 MW) against an overall tender size of 4,000 MW in the FY 2026-2027 process; results expected within ~2 months, around Q3 FY 2026-2027; the company is also participating in the open West Bengal tender.
• Brownfield expansion economics (CFO) — unit planned near pit head with Coal India linkage under the Shakti scheme for IPP units; coal cost expected at ~80 paisa per GCV (~Rs.2/unit) plus ~50 paisa variable cost, for an expected COP of ~Rs.2.5/unit (period unspecified).
• Pricing outlook (CFO) — recent DBFO tenders in the market are trading at Rs.6/unit or higher; management believes Rs.6 will be the base average pricing in 4-5 years (~FY 2030-31 to FY 2031-32), and above Rs.6 it expects a comfortable ROE with payback of less than 6 years.
• 13 GW aspiration (period unspecified) — currently at the discussion and land-identification stage, to be discussed at board level with an announcement at the appropriate time; no timeline disclosed for approvals or capex initiation.
• Capacity headroom — at 10-12x leverage, management estimates the balance sheet can support ~4 units of 800 MW (~3,200 MW) of new capacity (period unspecified); brownfield at Shakti is the strategically best location, with coal mining within 60-70 km.
• Ranking ambition — management aims to move from the 5th largest private sector player to the 3rd largest within the next five years (i.e., by ~FY 2031-2032); BTG equipment sourcing is a challenge common to all market participants (industry-wide), though VPL has back-to-back supply commitments from Indian OEMs for tenders it participates in.

Domestic Coal Push and Disciplined Outlook

• ~85% of coal requirement secured through long-term linkages (as of Q2 FY27); focus on maximizing linkage coal, diversifying domestic sources, and completely eliminating imported-coal dependence in FY 2026-2027.
• Meenakshi conversion target — management aims to convert the plant to 100% domestic coal usage (period unspecified).
• Open quantity of 100 MW at Athena will be sold in the open market (period unspecified), where market rates are currently moving at Rs.5-6/unit and above; management continues scouting medium/long-term tenders and expects to tie up the open capacity of Meenakshi and Athena.
• Group offtake option — on Vedanta Aluminum's indication that its aluminum expansion could source power from the group company, the CEO said it is "definitely a possibility" and VPL will brief once it materializes; framed as a possibility, not a commitment.
• Structural backdrop — management cited India's growing electricity requirement and increasing need for reliable base-load power as a strong backdrop for efficient thermal generation; growth approach to remain disciplined, linked to secure fuel tie-ups and acceptable returns.
• ESG metrics — specific fresh water consumption of 1.64 cubic meters/MWh in Q2 FY27, described as one of the lowest industry-wide; local procurement at 53% and local employment at 76%; H1 FY27 CSR programs reached 48,331 beneficiaries.