VEDPOWER Q2 FY27 Results Analysis: EBITDA Surges 122%, First Profitable Quarter

VEDPOWER's Q2 FY27 numbers came in strong. Here's a quick read of what worked, what to watch, and what management said.

Quarter Snapshot

Q2 FY27 was Vedanta Power's first clean profitable quarter as a listed entity, with revenue up 38.21% YoY to Rs.2,908 Cr and EBITDA up 121.58% YoY at a 14.48% margin. Earnings quality caveats include zero current tax, a Rs.68 Cr H1 PAT benefit from the useful-life revision, and the Rs.127 Cr SC penalty still in the legal process. Leverage at ~5.49x net-debt/EBITDA remains elevated, but DSCR improved to 1.14x and H1 FCF was Rs.497 Cr.

Key Investment Insights

Key Positives

• Revenue from operations grew 38.21% YoY and 11.54% QoQ to Rs.2,908 Cr
• EBITDA grew 121.58% YoY to Rs.421 Cr with margin expanding to 14.48% from 9.03% YoY
• Reported PAT of Rs.83 Cr vs a loss of Rs.(1,689) Cr YoY; normalized PAT Rs.101 Cr vs normalized loss of Rs.(238) Cr, a +Rs.339 Cr swing
• Exceptional loss narrowed to Rs.(23) Cr from Rs.(2,067) Cr a year ago
• H1 CFO of Rs.940 Cr (vs Rs.771 Cr) with FCF of Rs.497 Cr and CFO/EBITDA of 1.32x
• DSCR improved to 1.14x from 0.54x YoY; ISCR to 1.81x from 0.90x
• Meenakshi Energy contributed 29% of consolidated revenue (Rs.842 Cr) and Rs.32 Cr of PAT
• Standalone EBITDA margin of 15.49% vs 9.25% YoY with standalone PAT of Rs.51 Cr vs loss of Rs.(1,641) Cr

Risk Factors

• Net debt of Rs.7,821 Cr implies ~5.49x annualized net-debt/EBITDA run-rate, still elevated
• Zero current tax against PBT of Rs.79 Cr — reported PAT is entirely deferred-tax-assisted
• Useful-life revision to 40 years raised H1 PAT by Rs.68 Cr consolidated and flatters the YoY D&A comparison (Q2 D&A −38.1% YoY)
• Rs.127 Cr Supreme Court penalty plus undisclosed surcharge booked as exceptional; review petition dismissed with further legal remedies pending
• Finance costs rose 16.28% YoY to Rs.200 Cr on debt-funded Sakti revival capex
• Net working capital flagged negative in the Reg 52(4) note; current ratio 0.89x