Sarda Energy & Minerals Ltd disclosed a temporary shutdown at a hydro power plant operated by its subsidiary, Madhya Bharat Power Corporation Ltd., following a transmission tower collapse on June 18, 2026. The incident, caused by heavy rains at the Sikkim Hydro Power Plant, has halted operations while the company evaluates the extent of the damage and the time required to restore services. The financial impact of the disruption is mitigated as the resulting loss is covered under insurance.

Operational Impact

The collapse of the transmission tower forced the suspension of activities at the facility. Management is currently focused on assessing the structural damage and determining the necessary repairs to resume power generation.

Financial Safeguards

Sarda Energy & Minerals reported a strong financial performance for FY26, with profit after tax rising 58% year-on-year to INR1,109 crores. The company's diversified energy and mining strategy drove a 44% increase in EBITDA to INR2,025 crores, surpassing its earlier guidance of INR2,000 crores. Consolidated revenue for the year grew 23% to INR5,928 crores, while the market capitalization crossed INR20,000 crores during the period.

The Board has recommended a record dividend of 200%, subject to shareholder approval. Operational highlights included the highest ever thermal power generation of 4,155 million units and hydropower generation of 661 million units. The energy segment contributed two-thirds of the total EBITDA, underpinned by the successful integration of SKS Power assets and the commissioning of the 25-megawatt Rehar hydropower project.

Financial Performance

For the fourth quarter of FY26, consolidated revenue stood at INR1,258 crores. EBITDA for the quarter was INR352 crores, while PAT increased 53% year-on-year to INR155 crores. The standalone operating performance was impacted by planned shutdowns, including the replacement of a 30-megawatt captive power unit, though financial results improved due to better market conditions.

Strategic Developments

The Supreme Court dismissed dissenting appeals against the company's resolution plan for SKS Power Generation Chhattisgarh Limited, clearing the path for expansion. Sarda Energy aims to double its thermal capacity to 1,200 megawatts by FY30, leveraging existing infrastructure such as land, water, and grid connectivity. The company has applied for environmental clearance for this brownfield expansion.

In the mining sector, the Gare Palma IV/7 coal mine reached its maximum permissible production limit of 1.8 million tons per annum in FY26. Development of the Shahpur West coal mine is progressing as scheduled, with commissioning targeted before the end of FY27. The company also received consent to operate for expanding production capacity at Gare Palma IV/7.

Expansion and Outlook

The Board approved the expansion of the iron ore pellet plant capacity at Raipur from 9 lakh tons to 20 lakh tons, involving a capital outlay of approximately INR500 crores. The project is expected to be completed within 2.5 years. Additionally, the company approved acquiring a majority stake in Adishankar Khuitam Power Private Limited, which holds rights for a 66-megawatt hydropower project in Arunachal Pradesh.

Management highlighted that the Indian power sector witnessed record peak demand of 270.8 gigawatt during the quarter. While steel prices recovered by 10% to 15% in Q4FY26, the company remains cautious about global volatility and geopolitical tensions impacting input costs. Sarda Energy continues to maintain a robust liquidity position of INR2,380 crores and a net debt-to-EBITDA ratio of well below 1x.

Operational Data Correction

Sarda Energy filed a correction to its investor presentation dated June 5, 2026, regarding domestic coal sales figures. The company revised the data for the Gare Palma IV/7 mine and other domestic operations.