Corporate Development     

Published: October 31, 2026
Updated: October 31, 2026

Gujarat Industries Power Company

Old player’s new focus on green power: From thermal power to green energy

Gujarat Industries Power Company (GIPCL) is a power utility promoted by state-owned enterprises who collectively hold a 56.57% equity stake in the company. Considering that it has been in existence for over 40 years, its current power generation capacity of 1,859.40 MW is quite small. However, in terms of revenue, profits, dividend distribution and balance sheet, it is on a strong wicket. The indications are that the company is gearing for rapid growth, confident in its vast experience and aware of the increased power demand across the state.

GIPCL is currently developing a 2,375 MW renewable energy park at Khavda in Kutch district of Gujarat. It also intends to undertake a 400 MW solar project near its Surat lignite power plant. In line with the mandate by the Central and state governments, the company is also pursuing various opportunities in the green hydrogen space and plans to set up production units by leveraging its in-house expertise and tie-ups with various PSUs.

For implementing the 2,375 MW Khavda RE Park, alongside an additional roadmap to implement 1,100 MW of a standalone solar project within the same park, the state government has allocated 4,750 hectares of land to the company in the great Rann of Kutch area.

As such, the land is leased out to support a mix of solar, wind and hybrid clean energy infrastructure. This major development would prove a game changer for GIPCL in terms of improving its metrics drastically, and most importantly will bring a broader shift in its power generation from thermal/lignite to green energy.

Installed capacity

ENERGY HUB

“Khavda RE Park will contribute significantly to our accelerated growth and transformation into a diversified and future-ready power generation company. With the common infrastructure substantially developed, together with the company’s own solar projects progressing towards operationalization, in addition to work on other solar projects also in full swing, the Khavda RE Park is emerging as an important renewable energy hub in the country,” says Ms Vatsala Vasudeva, Managing Director.

Recently, the company invited bids to design, engineer, supply, erect, test and develop a 20MW/120MWh vanadium redox flow battery (VRFB) energy storage system at its 165 MW gas power plant complex at Vadodara. Bondada Engineering secured this contract worth Rs 239.25 crore to execute the BESS project. As a result, the gas station did not generate electricity. The company plans to repurpose its inoperative gas-based combined cycle power plants into standalone BESS stations and expand renewable energy parks coupled with storage across Gujarat.

GIPCL has two captive lignite mines located at Mangrol-Valia and Vastan, with a combined capacity of 5.4 million tonnes per annum, and is pursuing expansion of the Mangrol-Valia lignite mine to meet the enhanced lignite requirement for the extended life of SLPP-I units. In case of inadequate lignite mining, the company either procures coal locally or imports it to run its power plants uninterruptedly. During FY26, it used two lakh tonnes of imported coal.

2030 TARGET

The company had applied for government wasteland in the districts of Jamnagar and Patan for the development of renewable energy projects. While it is not clear whether the government has given its nod, GIPCL has set itself an ambitious target of 5 GW of power generation capacity by 2030, as revealed by Ms Vasudeva.

During FY 26, the company fared impressively by reporting total income of Rs 1,586 crore (PY Rs 1,325 crore), EBITDA of Rs 633 crore (PY Rs 475 crore) and PAT of Rs 402 crore (PY Rs 211 crore). The transition to the new concessional corporate tax regime has resulted in a one-time accounting tax credit of Rs 260 crore; hence, there is a net negative tax provision of Rs 157.74 crore for FY 26. The finance cost shot up by 247% from Rs 32 crore in FY 25 to Rs 111 crore, with long-term borrowings nearly doubling from Rs 1,733 crore to Rs 3,248 crore. EPS improved to Rs 25.93 from Rs 13.97 on equity capital of Rs 155.22 crore, with a book value per share of Rs 247.

The current FY 27 has begun exceedingly well. In the Q1 ended June 2026, the company achieved total income of Rs 611 crore, EBITDA of Rs 354 crore and PAT of Rs 158 crore, translating into EPS of Rs 10.17 in just three months of operations vis à vis Rs 25.93 in the full year (FY 26).

Financial Indicators (Rs. cr)

25-YEAR PPA

“The government of Gujarat allotted the 750 MW lignite-based thermal power project to the company in July 2025. GUVNL gave an in-principle approval to a 25-year Power Purchase Agreement (PPA) in August 2025. Both the state and Central governments have emphasized the need for expeditious implementation of this project, considering its critical role in enhancing grid stability in the South Gujarat region. Land for the power project is in the possession of GIPCL at Vastan village in Mangrol district of Surat. Project management and environment consultants have been appointed. An EPC tender for the project was floated in June this year. I am confident that with the rich experience of the GIPCL SLPP team in establishing the 4x125 MW Surat lignite power plant, GIPCL will execute the project successfully,” says Ms Vasudeva.

Against a decent book value of Rs 247 per share, the Rs 10 face value stock is available at Rs 169, with a yearly high-low of Rs 212-120 and market capitalisation of Rs 2,628 crore. Discerning investors can enter the scrip, keeping at least a 12-month horizon for good appreciation.