Sarda Energy & Minerals (504614) Q2 25/26 earnings summary

Executive summary

• Achieved record half-yearly production in iron ore pellets, captive power, hydro power, and Indonesian coal mine output, with energy segment contributing up to 72% of EBIT and driving growth.

• Strategic expansion in thermal and hydro power, including commissioning of Rehar hydro project and acquisition of SKS Power (IPP Binjkot), boosting capacity and segment performance.

• Strong liquidity position with over INR 2,200 crore in cash and liquid investments, and net debt/EBITDA ratio as low as 0.32x.

• Ongoing vertical integration across minerals, energy, and metals to optimize costs and value addition.

• Board approved unaudited results for Q2 and H1 FY2025-26, including full-period impact of SKS Power Generation acquisition.

Financial highlights

• Consolidated revenue for H1 FY2025-26 reached ₹3,161 crore, up 52% year-on-year; Q2 FY26 revenue at ₹1,528 crore, up 32% year-on-year.

• EBITDA for Q2 FY26 was ₹580 crore, up 48% year-on-year; H1 FY26 EBITDA at ₹1,277 crore, up 75% year-on-year, with margins improving to 36.3%.

• Consolidated net profit after tax for H1 FY2025-26 was ₹764 crore, up 90% year-on-year; Q2 FY26 PAT at ₹328 crore, up 61% year-on-year.

• Standalone revenue and PAT also saw strong year-on-year growth, with standalone PAT up 95% in Q2 FY26.

• Liquidity robust with significant cash generation and net debt below INR 500 crore as of September 2025.

Outlook and guidance

• Doubling of IPP Binjkot (SKS Power) generation capacity planned; 75 MW hydro and 50 MW solar projects under development.

• Expecting 80% annual PLF for SKS power plant and cost savings from lower coal prices.

• CapEx of INR 500–700 crore per year committed for next three years, focused on iron ore, coal mines, and hydro projects.

• Energy division expected to be the major EBITDA contributor from FY26 onwards.

• Hydropower business is seasonal, impacting quarter-on-quarter comparability.