JSW Energy's Acquisitions Of KSK Mahanadi, O2 Power To Be Key Differentiator In Performance: CEO

JSW Energy Ltd. has reported a "phenomenal" fourth quarter, driven by important acquisitions, operational efficiencies and a surge in renewable energy generation, according to Chief Executive Officer Sharad Mahendra.

The power generation company completed the acquisition of O2 Power on April 9. Its green energy arm, JSW Neo Energy, acquired O2 Power's 4.7 GW renewable energy platform for Rs 12,468 crore. JSW Energy also completed a "very large return-accretive" acquisition of KSK Mahanadi Power Co., which is now JSW Mahanadi, for Rs 16,084 crore after the approval of the resolution plan by the National Company Law Tribunal.

"The quarter has been phenomenal for us for the reasons — one is, of course, in terms of the revenue, in terms of the margins," he said during a conversation with NDTV Profit on Friday.

"But apart from that, some of the big actions... are going to be a key differentiator in our performance," Mahendra said. "These two (acquisitions) are major drivers going forward, whether it is at the Ebitda level or the PAT level."

In just 25 days of operation, JSW Mahanadi demonstrated a dramatic turnaround. It achieved a plant load factor of 77% and a deemed PLF of 99%, compared to a full-year PLF of 67.4% under its previous management, according to Mahendra.

The top executive attributed this to operational efficiencies implemented by JSW Energy. This included leveraging the plant's proximity to coal mines to sell 90 MW of untied merchant capacity. "It is an opportunity that was previously underutilised," he said.

JSW Energy reported a 54% year-on-year generation growth in Q4. It was driven by a 34% growth in the RE portfolio, with wind capacity additions delivering a 67% quarter-on-quarter increase. This happened despite the period preceding the peak wind season, the CEO added.

The company's consolidated net profit jumped 16% to Rs 408 crore in the March quarter.  

On the impact of potential interest rate cuts, Mahendra said it would support JSW Energy's ambitious capital expenditure plans. "A softening of interest rates will benefit capex-intensive industries like ours and improve liquidity."

This is particularly relevant to JSW Energy's 'Strategy 3.0'. The power sector player targets reaching 30 GW of capacity by 2030. It has a planned capex of approximately Rs 1.3 lakh crore between FY26 and FY30.

Shares of JSW Energy closed 3.44% higher at Rs 504.05 apiece on the BSE on Friday, compared to a 0.24% decline in the benchmark Sensex.