Gujarat Industries Power Company Limited (GIPCL) has commissioned an additional 105 megawatts (MW) capacity from its 600 MW solar project at Khavda. In a regulatory filing, GIPCL stated that this project in Gujarat's Great Rann of Kutch raises the project's operational capacity to 210 MW. The latest solar project is part of the 2,375 MW renewable energy park being developed in the region. GIPCL aims to commission 600 MWAC by September 2025 and another 500 MWAC by December 2026.

Credit Rating and Operational Performance

This development comes as CareEdge Ratings reaffirmed its ratings on GIPCL's bank facilities, citing stable operational performance from its 500 MW lignite-based capacity, which recorded a blended plant load factor of around 72% in FY24. The agency noted that its 310 MW gas-based capacity remains idle due to high fuel costs, while the performance of its 374 MW renewable portfolio has been satisfactory.

CareEdge flagged the company's large capital expenditure plans in renewables, including 1,100 MWAC of solar capacity at Khavda, as a rating constraint. The agency stated that cash flows from these projects remain vulnerable to weather risks.

Financial Performance

GIPCL reported operating income of INR 1,256 crore (USD 151 million) in FY24, broadly in line with the previous year due to lower tariff realization following a drop in fuel prices. Profitability remained stable with an EBITDA margin of 32% in FY25 compared with 29% in FY24, supported by cost-plus tariffs on its thermal power and compulsory offtake from renewables.

Capacity Expansion Plans

With the Khavda additions, GIPCL's total operational capacity of 1,184 MW is set to nearly double over the next two to three years, with renewables forming the majority, according to CareEdge. The company's expansion plans include commissioning 600 MWAC by September 2025 and an additional 500 MWAC by December 2026, as part of its renewable energy development strategy in the Khavda region.

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