Sarda Energy & Minerals Ltd (SARDAEN) Q1 FY27 Earnings Call: Posts Record EBITDA of Rs. 762 Cr, Net Debt-Free with Rs. 2,500 Cr Liquidity

Sarda Energy & Minerals Ltd held its Q1 FY27 earnings call on August 01, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Record EBITDA and PAT on Strong Energy Contribution

• Revenue of Rs.1,717 crores in Q1 FY 2026-2027, with EBITDA of Rs.762 crores — the highest ever quarterly figure for the company.
• PAT of Rs.478 crores includes a Rs.110 crore one-time net benefit from the Sikkim hydro regulatory approval; normalised PAT would be ~Rs.368 crores.
• Energy business contributed ~70% of consolidated EBITDA, underscoring the segment's dominant profit profile during the quarter.
• Net debt-free on both standalone and consolidated bases; liquidity exceeded Rs.2,500 crores as of 30 June 2026, with all expansions funded through internal accruals.
• Thermal PLF averaged 85.9% in Q1 FY 2026-2027; small hydro generation faced a ~1% shortfall due to delayed monsoon, improving in July.
• Metals production was temporarily impacted by planned outages: 30 MW CPP replacement at Raipur, 23-day Vizag CPP maintenance, and 53-day Siltara ferroalloy unit refurbishment.

Higher IPP Generation, Improving Realisations, Hydro Normalised

• Power realisations for FY 2026-2027 guided in the Rs.5-6/unit range; management clarified Q1's back-calculated Rs.8/unit included prior-period adjustments.
• IEX day-ahead prices averaged Rs.3.85/unit in Q1 FY 2026-2027 (vs Rs.3.92 in Q1 FY 2025-2026), rising to ~Rs.5/unit in July 2026 from Rs.4.20/unit in FY 2025-2026.
• IPP generation guided higher — management expects to exceed 415 crore units (FY 2025-2026 actual) by a reasonable margin in FY 2026-2027.
• Sikkim hydro project normalised and operating at full capacity; management sees "no residual impact" from the disruption in Q2 FY 2026-2027.
• 30 MW captive power plant commissioned in FY 2026-2027, expected to boost steel volumes; 50 MW captive solar project delayed, with commissioning expected before end of Q2 FY 2026-2027.
• Large hydro (113 MW) generated more than FY 2025-2026 even after a 13-day shutdown; small hydro saw ~1% shortfall in Q1 due to delayed rains, but Q2 is expected to be the strongest hydro quarter.

Thermal Doubling, Coal Mining Scale-Up, and Long-Dated Hydro Pipeline

• Thermal expansion at SKS from 600 MW to 1,200 MW — regulatory process on track; TOR submission expected in ~3 months (by Q3 FY 2026-2027), with final environmental clearance in 6-8 months.
• Coal mining capacity target of 7.1 MTPA includes: 1.8 MTPA Gare Palma 4/7, 2 MTPA Gare Palma 4/5, 2.1 MTPA Bartunga, 0.6 MTPA Shahpur West, and 0.6 MTPA Chanduri (provisional).
• Shahpur West high-grade coal mine targeted by end of FY 2026-2027; Bartunga Hill expected by end of FY 2027-2028; both supply sponge iron and ferroalloys.
• 66 MW Arunachal hydro project — most approvals received, construction expected to begin in FY 2026-2027 itself; approach road work has started.
• New plant to commence power generation by FY31 — management anticipates "total turnover will more than double by that time (period ending FY31)".
• ~Rs.300 crores investment in waste heat recovery power plant at Vizag as part of sustainability initiatives; all expansion funded through internal accruals.
• Management stated "no material execution risk to the FY30 growth roadmap," with the only potential exception being minor delays due to regulatory approvals.

Range-Bound Steel, Modest Ferroalloy Improvement, Anti-Dumping Support

• Steel prices remain range-bound with a mild negative bias in Q1 FY 2026-2027; ferroalloy prices saw modest improvement during the quarter.
• Management expects stable prices for both ferroalloys and steel in H2 FY 2026-2027, with ferroalloy margins potentially improving due to softening raw material prices.
• Steel pricing uptick contingent on a peace accord in West Asia; domestic demand from data centres and infrastructure projects remains robust, especially post-monsoon.
• Domestic crude steel production grew >7.5% in H1 CY 2026 (Jan-Jun 2026), outperforming China; India's apparent steel consumption grew YoY but momentum moderated sequentially.
• Management welcomed "the government's anti-dumping investigations to address unfair imports and support domestic steel producers," noting imports exceeded exports again after two quarters.

Outage Impacts, Mineral Wool Ramp-Up, and Coal Cost Trends

• Transmission tower collapse resulted in 5 days of generation loss in July (within Q1 FY 2026-2027), already reflected in Q1 results; restoration cost negligible and fully covered by insurance.
• Mineral wool project at 60-65% capacity utilisation; targeting full capacity in 3-6 months (within FY 2026-2027), but ramp-up constrained by imported equipment delays due to the East Asia crisis.
• Mineral wool revenue guided at Rs.90-110 crores for FY 2026-2027; the project is not yet profitable.
• Indian coal index (June 2026) was 21% higher than June 2025 and 11% higher than March 2026, attributed by management to global supply disruptions and Indonesia's export restrictions.
• Planned outages impacted metals production — 30 MW CPP replacement at Raipur, 23-day Vizag CPP maintenance, and 53-day Siltara ferroalloy unit refurbishment — all concluded during Q1 FY 2026-2027.

No Formal Guidance, but Power Uptrend and Demand Tailwinds Cited

• Management declined to provide specific EBITDA or PAT guidance for FY 2026-2027 due to volatile market conditions, but stated Q2 FY 2026-2027 operations "should be better".
• Power realisations expected to trend upward over time, driven by inflation and rising peak demand; management noted peak-hour tariffs are improving as solar oversupply is balanced by battery energy storage and policy changes.
• 1,550 MW solar project faces right-of-way challenges due to railway land acquisition; permission expected within 1-2 months, with no execution risk beyond the revised commissioning timeline.
• Industry data cited by management — India's power generation grew 9.4% YoY to ~523 billion units in Q1 FY 2026-2027, with thermal generation growing 7.5% and solar generation jumping 45%.
• West Asia conflict viewed as manageable for India's domestic demand-driven economy; elevated oil prices could cause inflation and affect steel demand.
• Long-term demand drivers from data centres and infrastructure projects remain robust; management also cited India's energy security and manufacturing-led growth priorities as supportive for the expansion pipeline.