This article first appeared on GuruFocus .
Release Date: November 12, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Sarda Energy & Minerals Ltd ( BOM:504614 ) achieved the highest ever half-yearly production of iron ore pellets, captive power, hydropower, and coal in Indonesian coal mines.
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The IPP thermal power plant improved its capacity utilization ranking from 125th to 11th in India, with a sector capacity of 85.27% compared to 56.13% in the previous year.
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Hydropower generation increased by 32% year on year, supported by an above-average monsoon and the commissioning of a new 24.9 megawatt hydropower plant.
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The company posted a 61% year-on-year growth in consolidated profit after tax, reaching INR 328 crores, exceeding the previous year's total profit in the first half itself.
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The company's net gearing is negligible, providing headroom for financing growth opportunities, with a robust liquidity position of about INR 2,200 crores in cash and liquid investments.
Negative Points
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The seasonal fall in power price realization negatively impacted the profitability of the thermal power operation.
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The power demand remained subdued due to extended rainfall and below-average temperatures, affecting the weighted average price of power.
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The Indian coal index fell from 140 in September 2024 to 124.68 in September 2025, indicating a decrease in coal prices.
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Steel prices were weak due to seasonal effects and imports, with India remaining a net importer of steel despite anti-dumping duties.
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The company faces challenges in land acquisition for its Indonesian coal mines due to flooding and plasma plantation issues, affecting expansion plans.
Q & A Highlights
Q: Can you provide an update on the SKS power plant's performance in terms of PLF realizations and cost performance in Q2, and any guidance for the second half of the year? A: We achieved a PLF of 55% in Q2, down from 90% in Q1. We aim for an annual average PLF of 80%. We expect coal prices to decrease by about ?200 to ?250 per metric ton, which should save about 15 paise per unit of power cost. - Unidentified_3
Q: With the current softness in steel prices and increased supply from primary steel makers, what strategies do you have to defend margins? A: Steel prices have been weak, but we believe this is the bottom of the cycle. We expect prices to improve post-monsoon. We also sell power instead of using it for production when margins are low, which helps maintain our margins. - Unidentified_4
Q: Is the company planning any organic or inorganic growth in the next two years, specifically for the power segment? A: We have plans for three more hydropower projects of 25 MW each and a 50 MW solar power plant under execution. We are also expanding our existing 600 MW ITP. We are constantly looking for both organic and inorganic growth opportunities. - Unidentified_3
Q: Could you provide an update on the Supreme Court hearing? A: The Supreme Court hearing has taken place twice, and the next hearing is scheduled for the 18th of this month. It's a normal legal process, and we are not facing any hurdles. - Unidentified_3
Q: What is the expected CapEx for FY26 and FY27? A: For FY26, we have estimated a CapEx of ?500 to ?600 crores, and for the next three years, we have lined up CapEx of ?500 to ?700 crores annually. This includes investments in iron ore mines, coal mines, and hydropower projects. - Unidentified_3
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
