JSW Energy has announced a significant development in its thermal power expansion through a turbine generator supply contract for its 1,600 MW Salboni project. JSW Thermal Energy Limited, a wholly owned subsidiary of JSW Energy Limited, has entered into a supply contract with associate company Toshiba JSW Power Systems Private Limited for the procurement of critical equipment for the Salboni thermal project in West Bengal.

Contract Details and Strategic Partnership

The supply agreement covers two steam turbine generators, each with a capacity of 800 MW, forming the core equipment for the 1,600 MW Salboni thermal project. The following table outlines the key contract parameters:

The turbine-generator package will be manufactured and supplied according to the project's construction schedule, supporting timely completion and commissioning of the plant. By sourcing key equipment through an associate company, JSW Energy aims to enhance supply-chain certainty, improve coordination during execution, and reduce risks arising from industry-wide equipment shortages.

Thermal Capacity Expansion Strategy

JSW Energy's thermal power portfolio demonstrates significant growth trajectory. The company currently owns and operates 5,658 MW of thermal generation capacity, fueled by a mix of imported and domestic coal. With the 1,600 MW Salboni project under construction and an option to add 1,800 MW at KSK Mahanadi, the company's total thermal capacity is expected to increase substantially.

The expanded thermal capacity of 9,058 MW would represent approximately 30% of the company's total locked-in capacity of 30.5 GW, underscoring the balanced role of thermal power within its overall generation portfolio.

Leadership Perspective on Strategic Value

Sharad Mahendra, Joint Managing Director and CEO of JSW Energy, emphasized the strategic importance of the partnership: "The turbine generator supply contract with Toshiba JSW is a strategic step in strengthening supply-chain control and ensuring execution certainty for our Salboni Thermal Project. Our long-standing association with Toshiba, forged in 2008, is built on shared values of excellence, innovation, and a commitment to long-term value creation."

Mahendra further highlighted the project's contribution to India's energy security, stating that the Salboni Power Project underscores the company's commitment to supporting India's energy security by adding reliable baseload capacity that complements the country's expanding renewable footprint.

Company's Overall Generation Portfolio

JSW Energy has established a comprehensive generation portfolio with total locked-in capacity of 30.5 GW. The capacity breakdown includes:

• Operational capacity: 13.3 GW
• Under-construction projects: 12.4 GW across thermal and renewable
• Under-acquisition hydro: 150 MW
• Pipeline projects: 4.6 GW

The company also maintains 29.4 GWh of locked-in energy storage capacity through hydro pumped storage projects of 26.4 GWh and battery energy storage systems of 3.0 GWh. JSW Energy aims to reach 30 GW generation capacity and 40 GWh of energy storage capacity by FY 2030, with a target to achieve carbon neutrality by 2050.

Motilal Oswal has issued a BUY rating on JSW Energy with a target price of ₹657, representing a 34% upside potential. The recommendation follows the brokerage's plant visit to the company's Vijaynagar facility on January 7-8, 2026, where the company showcased its green hydrogen and floating solar projects.

Operational Capacity Expansion

JSW Energy has demonstrated strong execution capabilities by significantly expanding its operational footprint. The company's capacity growth highlights its robust project implementation:

Green Hydrogen and Solar Initiatives

The company has commissioned two significant renewable energy projects at its Vijaynagar facility. The 5,000 m³/hour green hydrogen plant was commissioned in November 2025 for captive consumption by JSW Group's adjacent steel plant. However, green hydrogen economics remain challenging, with current costs hovering around USD 3.5-4/Kg compared to the USD 2-2.5/Kg level required for mass-scale commercialization.

The 20MW floating solar plant, commissioned in September 2025, represents a novel approach that eliminates land acquisition requirements and provides natural cooling benefits. This cooling effect boosts generation by slowing down module degradation, though internal rates of return remain broadly similar to ground-mounted solar plants.

Project Pipeline and Financial Stability

JSW Energy's strategic positioning is strengthened by its substantial project pipeline and improved cash flow stability:

The significant reduction in merchant exposure to approximately 5% of the installed base substantially enhances cash flow stability, while the majority of the pipeline being secured under long-term power purchase agreements provides revenue visibility.

Financial Projections

Motilal Oswal's positive outlook is driven by the company's strong, PPA-backed renewable pipeline. The brokerage has projected robust financial growth over the forecast period:

These projections reflect the expected benefits from the company's expanding renewable energy portfolio and improved operational efficiency. The combination of capacity expansion, reduced merchant exposure, and a substantial secured pipeline positions JSW Energy favorably for sustained growth in the renewable energy sector.