Power Mech Projects Secures ₹551 Crore in New Contracts

Infrastructure services firm Power Mech Projects Limited announced on July 14, 2024, the acquisition of two operation and maintenance (O&M) contracts worth a total of ₹551.35 crore, excluding taxes and additional levies. These contracts represent a significant expansion of the company’s portfolio in the energy sector.

The first contract, valued at ₹498.39 crore, has been awarded by SJVN Thermal (P) Ltd. It involves commissioning support and comprehensive O&M for the coal-based supercritical Buxar thermal power project, which features two units of 660 megawatts (MW). This project is located in Chausa, within the Buxar district of Bihar. The execution period for this contract is set at 39 months.

In addition, Power Mech Projects secured a second contract from Jhabua Power Limited, a joint venture of NTPC Limited. This contract, valued at ₹52.96 crore, focuses on the operation and maintenance of the boiler, turbine, and generator for a single 600 MW unit located in Seoni district, Madhya Pradesh. The contract is scheduled for a duration of three years, with an option for a one-year extension.

Strong Financial Performance

Power Mech Projects has also demonstrated robust financial growth, as reflected in its latest quarterly results. The company reported a net profit increase of 53.8% year-on-year, reaching ₹129.8 crore compared to ₹84.4 crore in the same quarter of the previous year. This impressive growth can be attributed to strong revenue performance alongside stable operating margins.

Revenue for the quarter reached ₹1,853.3 crore, marking a 42.4% increase from ₹1,301.5 crore in Q4 of FY24, highlighting the company’s effective execution across its key segments. The company’s earnings before interest, tax, depreciation, and amortization (EBITDA) rose by 44.3% year-on-year to ₹215.7 crore, reflecting an increase from ₹149.5 crore reported a year earlier. Operating margins remained consistent at 11.6%, slightly up from 11.5% the previous year, indicating effective cost management strategies.

Despite the positive news, shares of Power Mech Projects Limited closed at ₹3,227.80, down by ₹82.30, or 2.49%, on the Bombay Stock Exchange (BSE). The market’s reaction reflects broader trends in the financial landscape, which can often be influenced by factors beyond individual company performance.

The recent contracts and strong financial results position Power Mech Projects favorably in the competitive infrastructure services sector, providing a solid foundation for future growth and development.