Power Mech Projects wins mine development project worth Rs 30,000 crore from SAIL

The project has total coal extraction reserves of 96.78 MT along with an annual capacity of 4 MTPA and overburden removal during the project period will be 535.29 MCBM.

The order is four times larger than Power Mech's overall market capitalisation of over Rs 6,000 crore, while it is over 15 times larger than the company's free float market capitalisation of Rs 2,000 crore.

Power Mech has won the order in consortium with PC Patel Infra, wherein the company has a 74 percent stake, while PC Patel Infra will hold 26 percent. A Special Purpose Vehicle will also be formed to undertake the project.

"The project can add peak turnover of around Rs 1,200 crore, plus escalation annually," Power Mech CMD Sajja Kishore Babu said. Revenue booking for this will start from financial year 2024. Babu further said that the project will enable the company to diversify its order book, in-line with its strategy to have an optimum mix between power and non-power segments.

KBP and Tasra's MDO will generate 9 MTPA when the peak capacities of the respective mines are achieved and the coking coal extracted through these mines will be an inexpensive alternative to the coking coal which the country is currently importing and save forex outflow, Power Mech's CMD further said.

Shares of Power Mech Projects are trading 16 percent higher at Rs 4,907.1.