JSW Energy Ltd (NSE: JSWENERGY) Q3 2026 Earnings Call dated Jan. 23, 2026
Corporate Participants:
Sharad Mahendra — Joint Managing Director and Chief Executive Officer
Chandrasekaran Prabhakaran — Chief Financial Officer
Bikash Chowdhury — Investor Relations
Analysts:
Unidentified Participant
Anuj Upadhyay — Analyst
Sumit Kishore — Analyst
Mohit Kumar — Analyst
Rajesh Majumdar — Analyst
Apoorva Bahadur — Analyst
Satyadeep Jain — Analyst
Atul Tiwari — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to The JSW Energy Q3 FY26 earnings conference call hosted by Investech Capital Services. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference, please signal an operator by pressing STAR and then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Anuj Upade from Investec Capital Services. Thank you. And over to you, sir.
Anuj Upadhyay — Analyst
Yeah. Good evening everybody. On behalf of Investec Capital, I welcome you all to the conference call of JSW Energy to discuss the Q3 FY26 results. We have with us the leadership team of the company led by Mr. Sharad Mahindra. He’s a joint MD and CEO, Mr. Chandrasekaran Prabhakar, CFO, Mr. Vikash Chaudhary, head IR and ARM. And with this I would now like to hand over the call to Mr. Sharad sir for his opening remark and taking the call forward. Over to you, sir. Thanks.
Sharad Mahendra — Joint Managing Director and Chief Executive Officer
Thank you, Anuj. Good evening everyone and thank you for joining us today for JSW Energy’s Quarter 3 FY26 earnings call. Before we begin our discussion on the results, I would like to wish each of you and your family a very happy new year. I am also delighted to warmly welcome our CFO Chandrasekhar Prabhakaran who joined us at the beginning of January from JSW Steel. Prabhakaran brings with him over 25 years of rich and diverse experience across corporate finance, accounting and governance gained through senior leadership roles in large listed conglomerates. He has been associated with the JSW Group since November 2014 and was most recently serving as the Deputy Chief Financial Officer at JSW Steel Limited.
His appointment also reflects the group’s strong emphasis on leadership development and internal succession planning. Prabhakaran will be closely working with me as we continue our journey of strengthening the company and taking it to new heights together. The third quarter of this fiscal has witnessed a flattish power demand growth primarily driven by an unusually long and intense monsoon season and cooler temperatures which reduce the need for cooling and irrigation pump power demand leading to a muted overall growth. That said, we firmly believe the long term demand growth strongly remains intact and the current softness is largely a weather related phenomena.
Encouragingly, power demand growth in December 25 was robust at 6.5% year on year driven primarily by strong industrial activity. Even for the first 20 days of January, power demand growth is robust at 6%. For the year to date period till December 25, overall power demand growth stood at a modest 0.5% year on year. Another notable trend in last quarter was the all time high December peak demand of 241 gigawatt which also represented the peak power demand for the quarter. To compare the peak power demand, the corresponding quarter of the previous fiscal stood at much lower 224 gigawatt.
This underscores the underlying strength of power demand when weather conditions normalize, highlighting the continued structural growth despite near term volatility. From power sector perspective, bidding momentum during the year has been mixed, reflecting a clear evolution in the sector priorities. There is a growing recognition of the need for reliable and firm power with thermal capacity increasingly gaining prominence. On the thermal front, bits from various states aggregated 12.8 gigawatt during the first nine months of the current fiscal, underscoring renewed demand for dependable base road capacity. In contrast, renewable energy bidding activity has moderated with only 10.4 gigawatt for the first nine months of this fiscal.
Further, 7.6 gigawatt of storage bids were observed in the first nine months compared to 1.6 gigawatt of storage bidding in FY25 in the same period. Additionally, for the first nine months of the fiscal, about 10 to 12 gigawatt of renewable generation PPA is estimated to have been signed. Overall, the bidding landscape points to a clear transition from plain vanilla renewable energy towards a more balanced mix of thermal storage and firm power solutions aligned with the future needs of grid stability and energy security. Despite this broader moderation in bidding activity, our growth pipeline remains firmly intact.
We have already logged in about 18.7 gigawatt of incremental capacity in generation and 29.6 gigawatt hours in storage, which will take our installed capacity beyond our stated target of 30 gigawatt in generation. While we are confident of achieving our 40 gigawatt hour in storage by 2030 during the quarter, the merchant power market remained software with day ahead prices on exchanges declining both sequentially and year on year basis. Despite this, our merchant realization were at 20% premium to the average exchange prices during the quarter. This was possible due to strategic tying up of various back to back short term contracts.
Further, it is encouraging to note the improvement in the merchant tariffs by about 30% in the first 21 days of January compared to the average tariffs in the previous quarter. Despite last quarter’s subdued merchant market environment the impact on our business has remained limited. This resilience reflects the proactive de risking measures we have implemented over time including prudent portfolio diversification and disciplined contracting strategy. Currently our open capacity stands at approximately 8% which will further reduce to around 5% from 1st of April 2026 following the securing of 400 megawatt 25 year power purchase agreement for our Utkal plant in Olesa with Karnataka Discoms.
Additionally, we have also signed 115 megawatt short term power purchase agreement from our Utkal plant with Assam Discom for two years which further reduces our exposure towards merchant markets. With this, our total plant capacity Almost more than 95% will be tied up in long term. As a result, our portfolio continues to deliver stable and healthy returns underscoring the strength, resilience and flexibility of our business model even in challenging market environment. Now I would like to share the key highlights of our performance this quarter during which we have made meaningful progress across several fronts. Our power sales recorded a strong 65% year on year growth in quarter three of current year increasing from 6.8 billion units last year to 11.1 billion units in the current year.
In this quarter for the nine month period ended FY26 net generation grew by 62% rising from 24.4 billion units to 39.6 billion. Notably, long term PPAs accounted for 82% of total power sales and registered a 63% year on year increase in quarter three supported by our disciplined and robust portfolio de risking strategy. From a mode wise perspective, we witnessed improvement across all sectors. Our solar and wind portfolio net Generation rose by 149% year on year led by organic capacity additions and contributions from O2 power thermal generation increased by 55% year on year primarily driven by contributions from KSK and capacity additions at our Utkal plant.
Further, hydro generation grew 27% year on year versus the national average increase of 13% during the quarter benefiting from improved hydrology and contribution from our new Kuttehar plant in Himachal. I would like to reiterate that our quarterly power sales growth of 65% year on year stands out against a broader industry backdrop which recorded a demand degrowth of 0.1% on year in quarter three. Over the past 12 months we have added 5.2 gigawatt of capacity comprising of 3.1 gigawatt of renewable and 2.1 gigawatt of thermal which has been a key driver of our year on year EBITDA growth.
This expansion includes inorganic capacity additions of 1.5 gigawatt in renewables and 1.8 gigawatt in thermal, further strengthening the scale and resilience of our portfolio. During the quarter we added 125 megawatt of new capacity in renewables including hybrid projects, taking our total installed capacity to 13.3 gigawatt. Our capacity addition represents a significant year on year growth of approximately 64% up from 8.1 gigawatt in the same period last year. Building on this robustness, we have equally deliberate in shaping the quality of our capacity mix. On the capacity front, approximately 3.3 gigawatt which forms around 25% of our current installed capacity, is secured with high quality group captive and CNI customers.
As we scale beyond 30 gigawatt, this is expected to further increase to approximately 5.7 gigawatt. Importantly, these capacities are contracted at highly remunerative tariffs with renewable tire at a high blended average tariff of over 3 rupees 65 paisa per unit. Turning to our recent capacity additions, I am pleased to share that Kutahar plant has now fully stabilized and generated about 130 million units during the quarter. We have also continued to remain at the forefront of innovation. During the quarter we successfully commissioned India’s largest green hydrogen plant at our Vijayanagar location with a capacity of 3,800 tons of green hydrogen per annum, marking a significant milestone in the group’s decarbonization journey.
Many of you may have had the opportunity to visit this facility during the green hydrogen plant visit conducted earlier this month and see firsthand the progress we are making in this emerging area. I am pleased to share that as a reflection of our strong green focus and long term commitment to carbon neutrality, our expanding renewable portfolio enabled us to avoid approximately 14 to 15 million tons of CO2 emissions in the first nine months of this fiscal based on the prevailing Indian grid emission factor. Another important milestone during the quarter was the preferential allotment of equity shares to the promoter group involving a capital infusion of 3000 crores comprising 500 crores through equity and 2500 crores through warrants which will convert into equity over the next 18 months or earlier.
In addition, consistent with last year, we have also received shareholders approval for a potential issuance of up to 10,000 crores through a qualified institutional placement. On the inorganic growth front, the acquisitions announced in the previous quarter Tidong Hydropower and GE Powers India’s Boiler Manufacturing Division are progressing well. We expect to complete the Tidong Hydro Power transaction before the end of current month I.e. 31st January and the GE power. Further, we have also received the NCLT approval for this process is on NCLT approval for our resolution plan submitted by the company for Rigar Champa Railway which is the KSK plant rail infrastructure.
Further, I am also happy to share a couple of important strategic development post the quarter. On the thermal front post Q3 we have placed an order for two ultra supercritical turbine generators of 800 megawatt each for our Salvoni thermal plant in West Bengal with Toshiba jsw. The turbine generator package will be manufactured and delivered in line with the project’s construction schedule enabling timely completion and commissioning of the plant. By sourcing critical equipments through our associate company we are strengthening supply chain certainty, improving coordination during execution and mitigating risks arising from industry wide equipment constraints. This contract represents a strategic step in enhancing supply chain control and ensuring execution certainty for the Salboni project.
Further, at Sahaguni location I am pleased to announce the signing of our second 1600 megawatt PPA with West Bengal Discom for a second thermal power plant at Salmoni, increasing our total capacity at the site to 3200 megawatt. This makes Salvoni our largest single location asset. The project benefits from its strategic proximity to coal rocks as well as synergies with the existing 1,600 megawatt unit under construction driving significant operational efficiencies. With this, our secured thermal Capacity stands at 10.7 gigawatt and logged in capacity at total logged in capacity at 32.1 gigawatt providing ample visibility to our ambitious 2030 target of 30 gigawatt.
Moving on the financial performance which I am sure most of you have had an opportunity to look at already revenue for the third quarter increased by 61% year on year to about 4,255 crores in line with the robust growth in capacity and generation. Correspondingly, EBITDA increased by 98% year on year to 2,202 crores for the quarter. With the continued capitalization of newer assets on the balance sheet, interest and depreciation were higher on a commensurate basis, depreciation more than doubled and interest cost jumped by almost 2.6 times on a year on year basis. In quarter three the company has recognized a deferred tax asset and therefore the profit after tax is up by 150% to 420 crores in the quarter.
More importantly, our cash profits increased by 12% year on year to about 570 crore during the quarter on the deferred tax our JSW Energy Utkal has entered into a 25 year power purchase agreement with Karnataka Discom for supply of 400 megawatt of power power commencing 1st April 2026. In view of the reasonable certainty of sufficient future taxable profits from this PPA, the company has recognized a deferred tax assessment of 557 crores on carry forward based business losses and unabsorbed depreciation. Further on our KSK asset as well, there was a deferred tax recognition of 189 crore during this quarter related to carried forward business losses and unabsorbed appreciation.
Further to the above, in alignment with the changes in the labor codes announced recently, we have also provided with a conservative approach. We have provided 65 crores in relation to this which is one off provision in nature. Turning to leverage, net debt at the end of the quarter stood at 63,771 crores up from 61,960 crores as on September 30th September 25th. Excluding capital work in progress, the Pro Pharma leverage ratio stands at approximately 4.9x. The net leverage is expected to come down upon full receipt of the recently completed preferential allotment proceeds. Further, our liquidity remains strong supported by cash and cash equivalents of over 7100 crores on the cost of debt as guided earlier and in line with the recent rate cuts, we continue to see a sustained reduction in the weighted average interest rate during the quarter.
Our cost of debt declined by about 11 basis points quarter on quarter from 8.79 to 8.68%. We expect this declining interest cost trend to continue as and when our bank loans undergo their interest resets. Cash returns on net worth after adjusting for our investment in JSW Steel shares remained robust at approximately 19 to 20%. You may kindly refer to the slide number 14 for this. Finally, on receivables, total receivables at the end of December stood at approximately 3000 crores, translating to debtor days of 73 days, which is a sharp reduction versus the 96 days which we witnessed in the corresponding quarter of last fiscal.
The key takeaway is that the robust capacity additions undertaken so far have now begun translating into higher energy generation as well as cash flows and we expect this momentum to improve going forward. With this I conclude my opening remarks and we can now open the floor for Q and A. Thank you.
Questions and Answers:
operator
Thank you very much. We will now begin the Question and Answer session. Anyone who wishes to ask a question May press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two participants are requested to please use handsets while asking a question. Ladies and gentlemen, we will now wait for a moment while the question queue assembles. Our first question comes from the line of Sumit Kishore from Axis Capital. Please go ahead.
Sumit Kishore
Good evening and thanks for the opportunity. My first question is in relation to the Sardony project. Could you outline the PPA details for the first 1600 megawatt as well as the subsequent 1600 megawatt that you have entered with West Bengal? What is the likely capex pays out for this mega project and how do you. How are you looking to figure out commissioning of the units? That’s my first question.
Sharad Mahendra
See the PPA timelines first to me. Thank you very much. The PPA timelines which are there is from the date of proceed notice to proceed. I think the date it’s 48 months for the first unit of first phase and second unit after another six months. That is 54 months. So all the planning is within the same timelines. We will definitely be completing the phase one within the PPA timelines which are there. So that we are sure. Because we have our supply chain in terms of boiler, turbine and generator which is a challenge which country is seeing.
As I said in my remarks also that is all under control. So this is what we wanted to show. And also in terms of the capex we will be announcing. But yes, you can benchmark whatever we have said in the domain is that maybe the phase one about 16,000 crore of investment for two into 800 which we have announced earlier. So we’ll be around that number only.
Sumit Kishore
Okay. And what would be the tariff arrangement here? What fixed variable and what are the details?
Sharad Mahendra
See there are two. First bid the tariff is in the range of 3 rupees 65 paisa which we have already announced. And the second 4 rupees 6 paisa. This is the fixed charges only 3.6 for phase one and 4.06 for phase two. Fuel is passed through.
Sumit Kishore
Fuel is pass through.
Sharad Mahendra
Those things. Those details we will provide you. But that is as per the guideline which is there which is 2350 heat rate.
Bikash Chowdhury
This is Vikash here. We will be happy to connect with you on this. If you want a detailed we will give a detailed presentation and we’ll be. Happy to connect with you.
Sumit Kishore
Okay. My second question is on. You know you had targeted in second half of the year to commission about 1.5 watt gigawatt if I recollect and you know broader question is that given the grid constraints for this financial year now on an organic basis how much re capacity would you be able to close the year by and for the next financial year you have a sizable under construction sort of portfolio. So given grid constraints and other challenges what can be what is doable in FY27 on an organic basis? Also if you could attach.
Sharad Mahendra
Yeah yeah yeah yeah please tell just.
Sumit Kishore
To close this question if you could. Also there’s a big ramp up in CapEx that we are expecting to see in the coming financial year so broadly on an organic basis, your CapEx this year and the next financial year, how are you thinking about it?
Sharad Mahendra
See Sumit1 is that as we have said earlier, you rightly said that 1.5 gigawatt of fresh capacity addition during H2 of current fiscal out of which 125 megawatt we have commissioned during quarter three so we are well on track and in the current quarter the capacity addition which are going to take place it so we will be meeting the guidance what we have given for 1.5 gigawatt in second half of current fiscal and for which grid connectivity and land everything these projects are at advanced stage. Second for next year whatever plans we are having will be definitely giving the numbers later.
We are in the process of finalizing our next year plans but of course keeping in mind the connectivity availability and land as I have been saying for quite some time we are absolutely insulated for next one year to two years from connectivity challenge reason is two steps. What we took has secured us from this uncertainty which the country is facing is one is that we have majority of our projects coming next two years are STU instead of ists interstate it is intra state and STU connectivity is available and second is the O2 acquisition all capacities which are going to come under that hundred percent of the connectivity is available with us for the entire to reach the capacity of 4.7 gigawatt and beyond that if we have to do there is additional capacity connectivity is available beyond 4.7 in O2 also.
So these are the factors it gives us almost certainty that we will not be facing any challenge on these factors regarding capex numbers as and when we finalize our next year plan which we’ll be doing shortly we’ll be definitely making at the right time the announcement
Sumit Kishore
Just. To close the loop on you know you have about.
operator
So your audio is not coming through somit the request you to please repeat.
Sumit Kishore
Even connectivity challenges can get commissioned by say FY28 and also.
Sharad Mahendra
Yes, FY27 and FY28 more or less. Whatever plans we have to reach our 30 gigawatt by 2030, we are on track. And till FY28 we have absolute clarity of the connectivity also.
Sumit Kishore
Thank you. I’ll get back in the chute.
Sharad Mahendra
We will be commissioning as per the PPs because majority of our capacity the PPAs have been signed. So we are on track to to complete everything within the PPA timelines.
Sumit Kishore
Excellent. I’ll get back in the queue. Thank you and be sure.
operator
Thank you. Our next question is from the line of Mohit Kumar from ICICI Securities. Please go ahead.
Mohit Kumar
Yeah. Good evening and thanks for the opportunity. Sir, first question related to the PPA which you acquired for environment with Karnataka. I think it’s 400 megawatt. Is 400 megawatt net capacity. The first subserver question. The second is is it possible to. Help with the fixed tariff of this particular PPA?
Sharad Mahendra
Okay. See this 400 is the net capacity one. And this is a tariff at 5.88, 5.8 rupees at my plant bus
Mohit Kumar
and fixed carrier.
Sharad Mahendra
No, no. This is a fixed tariff of 5.8. But of course escalable. But this 5.8 tariff is the year one tariff which we are going to get from Maharashtra, from Karnataka. It is fixed plus variable fixed single tariff bidding which is there
Mohit Kumar
for 25 years. Is that right?
Sharad Mahendra
Yes. Yeah.
Mohit Kumar
Understood. Sir. My second question is on the
Chandrasekaran Prabhakaran
Salvani. Of course you are already given the order for the the turbine generator for the boiler for 3.2 gigawatt. What is the plan? Are you giving it to the GE facility which acquired or it only source. The source fuel components.
Sharad Mahendra
See. Yes. As we have announced earlier, the GE boiler manufacturing plant in Durgapur which we are in the process of acquiring. And we expect the process to be completed and the plant to be fully with us by June or July of 26. So we will be making these boilers for our captive requirement in Durgapur only which has a capacity of almost about 1.5 boilers of 800 megawatt 1.5 boiler equivalent material to manufacture. And as and when required we will increase the capacity also there. So we will be manufacturing our own requirements from Durgapur unit only.
Mohit Kumar
And this is my last question. What is the progress on conversion of our LO into LOA into PPA? Of course we have a good pipeline of PPA but still some of the LOAs on the RE side have been having there for quite some time. So what is the kind of conversation happening with the counterparties.
Sharad Mahendra
Yeah, see, see if you see that our total capacity which is there logged it is 4.12.6 gigawatt of capacity which is already contracted. Already PPA signed. Re front. I’m talking.
Mohit Kumar
Yes, my question was more about the pipeline of LOA which is lying with us for quite some time.
Sharad Mahendra
Yeah, that is about. See there is a total capacity which is There is about 4.5 gigawatt for which there is pendencies and some we are expecting shortly to get signed and others we are waiting. But keeping in mind that our contracted capacity and the PPA signed capacity, the gap is such that we are absolutely certain that 30 gigawatt number what we are telling by 2030 that is on track.
Chandrasekaran Prabhakaran
So Mohit, if I have to add on what sir is saying that we already have with the current capacity and with under construction we are at 27.5 gigawatt. Right. And on pipeline is 4.5 and the details of the pipeline is there. So, so you know as well as we know when this pipeline will get converted, right. There are lots of capacity like this which is pending closure. So as and when they close out we will let you know. And we are more than certain that we reach 30 gigawatt by 2030.
Mohit Kumar
Yeah, understood. So thank you and all the best. Thank you. Thank you.
operator
Thank you. Our next question is from the line of Rajesh Majumdar from 361 Capital. Please go ahead.
Rajesh Majumdar
Yes, good evening sir. So in line with the questioning earlier, I had a question on the overall quantum bidding. While you’re saying locked in contracts is fine, but do you foresee a reduction in the total bidding space, particularly in the renewable space next year in terms of the overall market size, in which case keeping our market share around the same, the level of additions will be limited to about 2.5 to 3 gigawatt per annum barring the locked in capacity. Is that a fair assumption?
Sharad Mahendra
I think yes. See there are. We have to understand that there are two, three challenges which are being faced. If you see current year, the capacity with Greenfield as I announced is extremely low in terms of the bidding which has taken place in first nine months. The unsigned PPAs which are there close to 40 gigawatt of bids where when the PPA signing is pending. So that is also slowing down the fresh bidding. Second, the uncertainties in terms of the connectivities like we are seeing a very good Greenfield capacity addition in the current year in the re space.
But will the same number continue for next two, three years is a challenge because now from FY27 we are seeing that the challenge of getting the fresh connectivities will be one of the major bottleneck which is going to be there. So all these factors put together, we definitely see that there will be a moderation in the bidding which we have been seeing till last fiscal and this is likely to continue.
Rajesh Majumdar
But even with that you are saying you’ll be your assumptions assume around 4 gigawatt additions per annum. So that is achievable.
Sharad Mahendra
As I told you, you see our present operating capacity, we are ending the year maybe in the range of whatever I say, 14 and a half, 15 gigawatt and then another about 12 to 13 gigawatt capacity already tied up.
Bikash Chowdhury
And also, and also just to add. And also there is the salmoni which is 3200 megawatt, which is 20, 30 and 31. So it will be more towards the end. They would. They will come up. Right. So it’s not. It’s not the capacity divided by number of years is what we are trying to say.
Rajesh Majumdar
Yeah, no, I understand that. Okay, thank you. My second question is sir, on the case, what is the impact of the tariff reduction on the overall EBITDA per annum and related question is 3Q we’ve seen a 30% drop in the standalone revenues. Is that a reflection of that or something else?
Sharad Mahendra
No, see one is that reduction in revenue. We have to understand that steel weather conditions there have been the reserve shutdowns which have back downs from the states, especially in the northern state of UP which has resulted in the lower revenue and generations. But we have to understand this is a tide of capacity. My plant availability is there. So for me this is not going to have any significant impact on my progress. This thing we will be getting as per the plant availability, my fixed charges. So that is one we are absolutely certain that that is not a challenge you ask.
And one more question. The tariff production tariff reduction, okay. There will be of course going forward in FY27 as per the PPA terms there will be a tariff reduction of close to about 1 rupee 25 paisa from one of the discoms. So that will definitely have some impact. But operational efficiencies, as I said earlier, during the year we have been building up a lot of operational efficiencies which have come during the year and kept on coming. So that will give us annualized benefit next year to some extent we will be definitely reducing the impact of this tariff reduction from that side and also the sale of the reserve shutdowns and other Things back down from the plants which we have started.
So that we are expecting that the impact on the overall EBITDA will be there something, but it will be minimal.
Rajesh Majumdar
What. What portion of total capacity is impacted. By the surf reduction out of 1800.
Sharad Mahendra
What capacity? Thousand megawatt.
Rajesh Majumdar
Of Thousand.
Sharad Mahendra
Okay, thousand megawatt which is with up. Tied up with you.
Rajesh Majumdar
Right, sir. And my last question is when do we see the first tranche of capital coming to the company? And a kind of. And also do you think that with the promoter stake coming in there is a chance of credit rating improvement in our debt? Yeah, that’s the last question. Thank you.
Sharad Mahendra
Right. See the thing is key, as I have said, maybe you will see the numbers December closing. We have sufficient cash flow free cash with us to take care of our going forward. The capex which is required and the funds which are required. But as I told you that the capacity whatever capacity addition plan once we finalize for next year capital requirement, we have the enabling approval to go for the fundraise as and when during the year if we feel definitely we will be going. But right now we are comfortable and because we have got the promoter equity infusion part of that already.
So which will take us there. And definitely we expect as a market is definitely expecting that with promoter investing at the current levels higher than what the current level is is a positive for us which the market is also seeing and the agencies also.
Chandrasekaran Prabhakaran
And to add on to the rating part, we are one of the best AA in the sector. But really appreciate your point that we will also take it to the rating agency and upgrade it for our best benefits. Thank you very much for this idea.
Rajesh Majumdar
Thank you. Thank you.
operator
Thank you. Our next question is from the line of Apurva Bahadur from IIFL Capital. Please go ahead.
Apoorva Bahadur
Hi, good evening. Thank you. Sir. I was just curious about the Utkal ppa. You said that it was a single part single tariff rate. Just wanted to know in case there is a back down for the plant, how do we get paid? As in will the state be the entire 5.8 rupee tariff or.
Sharad Mahendra
Yeah, as I told you that this is the total tariff which is 5 exact tariff is 5 rupees 78 paisa out of it. The fixed part is 4.04 and 1 rupees 74 paisa is the variable cost. And if the plant availability is there as per the ppa my fixed cost is assured.
Apoorva Bahadur
Okay, Understood sir. Sure. Thank you so much. The other thing sir, on. On Salmoni, the tariff for phase two is the fixed tariff. Is around what 40 paisa higher than phase one.
Sharad Mahendra
Yes, yes.
Apoorva Bahadur
In my understanding typically if the plant is larger there could be utilities which are which there will be commonality of utilities and typically the capex per unit per megawatt goes down. What precipitated this rise in tariffs and was the state okay with it?
Sharad Mahendra
I mean yeah, we have to realize. See one thing. The first phase of my Salgoni project was a year back when the tariff was discovered. The fixed cost. After that if you see all the bids which have happened have happened even at a higher price. State is seeing that what is the total cost. And this is still one of the lowest tariff. State is seeing this as 4 into 800 blended. If you see it becomes a significantly attractive tariff as compared to the almost 12 gigawatt of bidding which has happened during last one year in thermal space this is one of the most attractive tariffs.
So state is absolutely comfortable and regulatory approval also is in place. Keeping in mind what has prevailed, we need to know what has happened in other bids in Assam. Whether it is Bihar or whether it is mp. You see the states. So this is a very good tariff which has been discovered.
Apoorva Bahadur
Understood. So I see your presentation. I believe the Bess containerization and cell assembly plant is about to get commissioned. We have certain Bess PPAs as well which we need to execute. So will we be importing the cells and converting it and containerizing it at our facility for these ppa?
Sharad Mahendra
Yes, exactly. Yes, we are doing that.
Apoorva Bahadur
Okay. And have we placed the orders for the cells yet?
Sharad Mahendra
Yes, we are placed for some and the material will start coming because the trial production plant is stabilized. We have submitted our product for necessary approvals which we expect by March end or early April the approvals to be in place. But by the time we will start the production sometime in February between February March.
Apoorva Bahadur
Sir, can you share how much of cell capacity or sell import orders that you placed?
Sharad Mahendra
Exact number. I will get back to you right now. I’ll let you know. But yes, we understand and we have that sensitivity done. I can understand from where this is coming in terms of the prices which we are seeing the northward movement in prices. So we have been aware of this trend and accordingly we have taken the necessary steps at right time.
Apoorva Bahadur
Much appreciated. Thank you so much.
Sharad Mahendra
Thank you.
operator
Thank you. Our next question is from the line of Satyadeep Jain from Ambit Capital. Please go ahead.
Satyadeep Jain
Hi, thank you. Just wanted to check on re contracted capacity BPA in the pp. Specifically can you give an update on FDRE for what is happening? There.
Sharad Mahendra
That. That battery thing. See. We are waiting for the regular approval. We have. We are waiting for the regulatory approval for the fdre. We have received the letter. We’re waiting for regulatory approval. That is the state. There is no further communication to us from Rajasthan on this.
Satyadeep Jain
There is no communication on cancellation.
Sharad Mahendra
We are waiting for. The PPA has been signed. We are waiting for the regulatory approval. That’s all. Nothing else PPA has been signed.
Satyadeep Jain
That I know. But the. The SCRC approval is still pending, right?
Sharad Mahendra
Yes, yes, yes.
Satyadeep Jain
And just want to understand on the NEP also the government has been focusing a lot on distribution side. I know historically that is one area that you’re not focused on. Is there anything. Are you incrementally looking at that at all or is that a no go zone for you?
Sharad Mahendra
There is nothing is no go for us. We definitely keep looking towards the opportunities as the sector as the segment is evolving now we see lot of tailwinds in this area also. So we are in the sense that looking towards the various opportunities. We are estimating. We are also observing what is happening in UP which has come out with privatization. So we are keeping a track. But definitely we have to come with a concrete plan. But we are. There is definitely no go is not the world for us.
Satyadeep Jain
Just confirming you have evaluated. You’ll take a decision later on. But you have evaluated all these privatization opportunities.
Sharad Mahendra
Yeah, we are in the process because there is a sufficient capital allocation strategy also efficiently. So that also is a part which clears that how to prioritize and when to abort.
Satyadeep Jain
Okay. And on the DSM just wanted to given you also have a very wind heavy portfolio. Have you? You also obviously commented on that proposal for dsm. Just wanted to understand the government is also talking about DSM being at par with thermal by 2030. What is the implication basis the historical schedule generation you’ve analyzed on your portfolio from DSM tightening.
Sharad Mahendra
See, this is a industry wide issue. We have to understand. So as an industry we are definitely. We have taken up and the losses which are there at the industry level because of this is something. The cooling and other various other options which are we as an industry we have taken taken up and wind association is also actively working on these DSM settlement mechanism and loss of resistance. It would be that lots of resistance. It would be relaxed is what we feel. And let us wait for some more time on this. But yes, industry has taken this up with the ministry.
Satyadeep Jain
Okay, thank you so much.
operator
Thank you. Our next question is from the line of Nikhil from UTI Mutual Fund Please go ahead.
Unidentified Participant
Thank you sir, just have a couple of questions. So we have seen a lot of renewable generation getting curtailed in the quarter. Wanted to understand how much was the impact of it on our financial.
Sharad Mahendra
See the curtailment which is there. We have to understand that again because of the evacuation constraints and especially being witnessed majorly in the state of Rajasthan. So what is happening? There are two types of curtailments. One is against the GNA which is there that I have the grid connectivity and still the curtailment is there for the grid stability point. I financially I am protected because I am getting the full paper cost full as per the tariff. I am getting that. A part of our small part of the capacity which came up early and the connectivity is maybe a few months ahead.
We have got a TGN which is a temporary connectivity. As and when there is a pressure on the grid, this temporary grid connected with connectivity gets curtailed wherein there is a financial impact. So our portion is significantly small as compared to the large capacity which we operate. So our capacity, it’s negligible right now till now the impact on us and the positive which has happened we have just maybe about a week, 10 days back the new, this evacuation, this connectivity has got started with this. The even the curtailment has significantly reduced which has benefited us also from the temporary grid connected portfolio.
Unidentified Participant
Understood. And sir, any understanding as to why the wind PLFs have been lower? Because industry wide they’re a bit better than what we have reported at 16%.
Sharad Mahendra
See the thing is we have to understand the wind portfolio. If we see asset to asset. Our wind PLF in fact has been one of the best and significantly higher than what it was last year. We have to remember that a large portion of my acquired capacity of Mitra which is from 850 kilowatt machine to maybe 2 2.3 gigawatt giga megawatt of machines. So there the PLFs are low, those are low PLFs by design which all was considered at the time of acquisition. The valuation was done accordingly. So when on a blended basis, you see our PLF on a blended basis may look lower but on all the fresh capacities which we are commissioning there the PLFs are in line or slightly better than what is there in the country.
And going forward, as and when the new capacities get added with the newer portfolio, percentage of wind increasing in the overall, our PLF will also overall also will improve.
Unidentified Participant
The final question on the thermal bed, I mean at four rupees, I mean the returns that you’ll make are very Good. So any, any understanding as to how big can we look at our thermal portfolio? Say five, five, six years down the line.
Sharad Mahendra
Right now if you see that the thermal portfolio has a time period of maybe 48 to 54, 60 months to complete the project, the greenfield project. So right now what we are seeing is that 4 into 800 we have in Salamoni which we are absolutely working on. In addition to that at KSK when we acquired another 3 into 600 work which is already on is one capex because that will be balance of plant was fully ready part work of all other three units was done. So this will be completing additional capacity of 1.8 gigawatt at KSK will be coming at a much lower specific cost capex as compared to a greenfield and tariffs as you rightly said what are prevailing in the market.
So we are right now next five to six years seeing Salvoni coming in JSK edition and maybe if any other good opportunity is there we’ll be open. But it’s a time which will, it takes its own time.
Unidentified Participant
Okay, we have started CAPEX on the additional 1.8 gigawatt at KSC.
Sharad Mahendra
Yes we have started for the fourth unit which was already 30 to 40% of the work was complete when we acquired and also the some of the material which was lying in the port which we have been able to get after the NCLT order. We have placed the orders and enabling work has started and now very soon the entire work will start and we expect in about three years time we should be in a position to commission this.
Unidentified Participant
Commission one unit or the three units.
Sharad Mahendra
And then subsequently every three to six months that by balance two units also.
Unidentified Participant
Understood? Thank you sir.
operator
Thank you. Ladies and gentlemen, you are requested to please restrict yourselves to two questions only per participant. Our next question comes from the line of Atul Tiwari from JPMorgan. Please go ahead.
Atul Tiwari
Yes, thanks a lot. Sir, my question is on industry. So you mentioned that in the first nine months we have seen about 12 gigawatts of thermal bits from state. So to your mind how much more can happen over the next one or two years from the states only Are we looking at a similar number higher number and what can be your share potentially for the new thermal colleagues?
Sharad Mahendra
Yeah, this is again a question. See the government of India has announced 97 gigawatt of capacity addition fresh capacity commissioning by 203432 to 34 period. So in line with that whatever the pipeline is and balance so we see some bits, fresh bits definitely will be coming. Some of The States have already given their indication that they are preparing for the bidding so we expect maybe giving exact number will be difficult but yes, definitely there will be some fresh bits we expect expect at least for next one and a half to two years in thermal space will be coming.
Regarding us as I told you that we are absolutely full till 203132 but yes, any attractive opportunity with the sufficient timelines and efficient capital allocation we will be exploring all the possibilities and decide because now we are secured from the material supply point of view supply chain security with the acquisition of GE boiler plant and placing the Toshiba into the Toshiba jsw. So we are secured in terms of the supplies of BTG which has been a big constraint for the industry. So we will be evaluating the opportunities as and when the future bids come.
Atul Tiwari
Yeah thanks a lot sir. And my second question is on Consol PBT or PAT numbers excluding the deferred taxes. So obviously your capacity growth has been quite strong and generation and cash flows are good but your TVT has been under pressure because of depreciation and interest cost down in second quarter I believe and this year it’s in loss. So I mean how do you think about this dynamics as you further ramp up CAPEX and capacity over next 12 years asking because it does impact your reported roe post depreciation etc. So is that a target in your calculation at all to get the reported ROEs to 30, 40, 15% kind of number or you are okay to continue at a very suppressed PBT level?
Sharad Mahendra
Yeah, I’ll request Mr. Prabhakaran to just reply to your question.
Chandrasekaran Prabhakaran
So if you look at loan like currently we are kind of adding capacities now initially what happens is that as you add capacities initially I think if you look at the returns it is kind of at a lower rate and overall once the interest and this one starts coming down that is the time in which basically you will find the returns at a PPT level. So considering that that initially since we are in the kind of play phase where we are in the execution phase, the next two, three years we’ll have and this quarter specifically will have anyway a lower plf right in terms of serious both for wind and solar so that’s a seasonal one but as in we kind of stabilize I think should.
Kind of even out, you know.
Sharad Mahendra
And to add to what Prabhakaran said we have about 5.2 gigawatt of capacity which is wind and hydro right. So that on third quarter is always muted so we should actually look at it from on a year basis than just looking at one quarter.
Atul Tiwari
Yeah. Okay, thanks.
operator
Thank you. Ladies and gentlemen. We will take that as a last question. I would now like to hand the conference over to the management for closing comments. Over to you, sir.
Sharad Mahendra
Thank you everyone and thanks for being with us today. And again wish you a very, very happy 2026 and look forward again meeting you all. Thank you very much.
operator
Thank you. On behalf of Investec Capital Services. That concludes this conference. Thank you all for joining us. You may now disconnect your lines.