GE Power India Limited (GEPIL) has taken a significant step in its ongoing legal dispute with Jaiprakash Power Ventures Limited (JPVL), depositing ₹775.00 crore with the latter as part of a court-mediated agreement. This development comes after a series of legal maneuvers involving bank guarantees worth ₹775.00 crore related to previously announced contracts between the two companies.

Legal Proceedings and Court Orders

The dispute came to light when GEPIL filed petitions under Section 9 of the Arbitration and Conciliation Act, 1996, in the Delhi High Court. These petitions sought to prevent JPVL from invoking bank guarantees submitted by GEPIL under their contracts. Initially, the court granted injunctions in favor of GE Power India on August 1 and 4, temporarily halting any action on the bank guarantees.

Turning of the Tides

However, the legal landscape shifted during subsequent hearings. The Delhi High Court appeared inclined to vacate the injunction on the invocation of Advance Bank Guarantees (ABGs) in favor of JPVL. Facing this potential reversal, GEPIL made a strategic move.

GEPIL's Strategic Response

In a bid to protect its interests, GEPIL requested the court to allow it to deposit an amount equivalent to ₹775.00 crore with JPVL. In exchange, GEPIL sought the return of the un-encashed advance bank guarantees. The court accepted this proposal, effectively modifying its earlier injunction order.

Current Status and Future Implications

The Delhi High Court has disposed of the petitions based on this agreement. As per the LODR (Listing Obligations and Disclosure Requirements) filing by GEPIL on August 28, the company received the court's order on August 27, when it was uploaded to the High Court's website.

GEPIL's Company Secretary and Compliance Officer, Kamna Tiwari, stated in the filing that the company is currently evaluating further steps on the matter. This suggests that while a temporary resolution has been reached, the broader dispute between GEPIL and JPVL may not be fully settled.

Financial Implications

The deposit of ₹775.00 crore represents a significant financial move for GEPIL. While this action prevents the immediate encashment of the bank guarantees by JPVL, it also ties up a substantial amount of GEPIL's funds. The long-term financial impact of this decision will likely depend on the ultimate resolution of the dispute between the two companies.

As the situation continues to evolve, stakeholders will be watching closely to see how this legal and financial maneuver affects both GEPIL's operations and its ongoing relationship with JPVL. The resolution of this dispute could have far-reaching implications for both companies and potentially for the wider power sector in India.

GE Power India Limited (GEPIL) has reported a significant turnaround in its financial performance for the first quarter. The company announced its Q1 results, showcasing substantial improvements in profitability and revenue.

Financial Highlights

• Net Profit: GEPIL achieved a net profit of 316.10 million rupees in Q1, marking a remarkable turnaround from a loss of 250.10 million rupees in the same period last year.
• Revenue: The company's revenue grew to 2,867.30 million rupees, up from 2,464.00 million rupees year-over-year, representing an increase of approximately 16.37%.
• Total Income: Total income for the quarter stood at 3,398.30 million rupees, a significant jump of 34.39% compared to 2,528.70 million rupees in the corresponding quarter of the previous year.
• EBITDA Margin: Earnings before interest, taxes, depreciation, and amortization (EBITDA) margin improved to 12.00%, compared to -4.70% in the corresponding quarter of the previous year.

Operational Performance

• Order Backlog: The quarter ended with an order backlog of 26,353.00 million rupees, up by 13.06% compared to 23,309.00 million rupees in the same quarter last year, indicating a strong pipeline of future projects.
• Cash Collection: The company reported robust cash collection performance, attributed to focused efforts on operations and project claims.

Management Commentary

Puneet Bhatla, Managing Director of GE Power India Limited, expressed satisfaction with the company's performance, stating, "We've had a strong start to the year with our orders, sales, profitability, and net cash all exceeding budget. Our focused efforts on operations and project claims have resulted in a robust cash collection performance. This quarter's performance reinforces the success of our growth strategy and provides a solid foundation for the year ahead."

Business Outlook

The strong Q1 results indicate a positive outlook for GE Power India Limited. The company's improved financial metrics, coupled with a growing order backlog, suggest potential for sustained growth in the coming quarters. GEPIL's focus on the power generation equipment market and its comprehensive portfolio of solutions, including emissions control and services, position it well to capitalize on India's ongoing infrastructure modernization and energy sector development.

About GE Power India Limited

GE Power India Limited is a leading player in the Indian power generation equipment market. With manufacturing units in Durgapur, West Bengal, and Noida, the company offers a comprehensive portfolio of power generation solutions. GEPIL focuses on emissions control and services, aiming to provide sustainable, affordable, and reliable electricity solutions across India.

As part of the global GE Vernova group, GEPIL benefits from over 130 years of experience in addressing global energy challenges. The company is well-positioned to contribute to India's energy transition, working towards both electrification and decarbonization goals.