Power Mech Projects Wins Rs 279 Cr O&M Contract from Telangana Power

Power Mech Projects Ltd announced the acquisition of a significant operation and maintenance (O&M) contract valued at Rs 279.20 crore from Telangana Power Generation Corporation (TSGENCO). The agreement spans three years and covers the maintenance of ash and coal handling plants at the Yadadri Thermal Power Station (YTPS), which comprises five units, each with 800 MW capacity.

The company disclosed in a regulatory filing that the contract includes comprehensive O&M services encompassing mechanical, electrical, and control & instrumentation (C&I) systems. The scope specifically targets the ash handling plants of Stage-I (units 1 and 2) and Stage-II (units 3, 4, and 5), along with the complete coal handling plant for the entire 5x800 MW facility.

The contract value stands at Rs 279.20 crore, excluding GST, and contains a price variation clause applicable for the second and third years. This order marks another important domestic win for Power Mech Projects, with a contract duration commencing from the issuance of the letter of intent (LOI) or order confirmation.

This deal arrives amid robust operational momentum for the company. According to a recent investor presentation, Power Mech Projects recorded order inflows of Rs 3,113 crore in the fiscal year 2027 year-to-date, which includes Rs 970 crore from comprehensive O&M contracts and Rs 855 crore from infrastructure construction projects. These achievements reflect the company's expanding footprint across O&M, civil engineering, and metro/railway sectors.

Over the past five years, the company’s revenue has grown more than threefold, posting a compound annual growth rate exceeding 17%. Alongside this growth, there has been an improvement in operational profitability, with EBITDA margins rising by 67 basis points during the same period. The current order book, excluding mining development operations (MDO), totals Rs 17,317 crore, providing visibility into more than two and a half years of revenue generation. The firm anticipates further margin improvements driven by disciplined capital management and profitable expansion in its MDO and O&M segments.

Earlier this month, Power Mech Projects also secured a Rs 970 crore O&M contract from Vedanta Power for their Sakti Thermal Plant in Chhattisgarh. This contract involves the full spectrum of operations and maintenance activities for two 600 MW coal-based units and is scheduled for completion within 60 months from the LOI date.

The announcement of the Telangana order positively impacted Power Mech’s share price. After a recent decline of over 6% in the past month, shares rebounded by nearly 3% to Rs 2,441 on the National Stock Exchange (NSE) following the news. Despite some volatility, the stock has posted a 5% gain year-to-date but has experienced a 10% decline over the last year. Over longer periods, Power Mech’s shares have delivered notable returns, rising approximately 15% in three years and surging over 400% in five years.

Power Mech Projects operates primarily in infrastructure development and O&M services, with a focus on power generation projects. The company’s ability to secure substantial contracts in the power sector underscores its technical expertise and strengthens its position within a competitive market that continues to emphasize efficient plant operations and maintenance.

Investors and industry watchers will likely monitor how recent order wins and the sizeable order backlog translate into sustained revenue growth and profitability. The company’s diversified portfolio and steady execution of large-scale projects position it well to capitalize on ongoing developments in India’s energy infrastructure landscape.