Forward-looking Statements
This document contains certain forward-looking statements based on the currently held beliefs and assumptions of the management of GMR Power and Urban Infra Limited ("GPUIL" or "the Company"), which are expressed in good faith and, in its opinion and judgement, are fairly reasonable. For this purpose, forward-looking statements mean statements, remarks or forecasts that address activities, events, conditions or developments that the Company expects or anticipates which may occur in the future. Because of the inherent risks and uncertainties in the social and economic scenario, the actual events, results or performance can differ materially and substantially from those indicated by these statements. GPUIL disclaims any obligation to update these forward-looking statements in light of future events or developments, except as required by law.
Introduction
FY 2025-26 marked a year of strengthening fundamentals through operational excellence and strategic portfolio actions, positioning GPUIL for its next phase of growth. The Company enhanced its financial resilience, strengthened its balance sheet, and improved strategic flexibility, creating a stronger platform for future expansion.
During the year, GPUIL advanced its portfolio transformation agenda through the substantial completion of the divestment of its non-operating gas assets and a hydro asset announced in the previous year. Concurrently, the successful preferential issuance of equity shares and warrants reinforced the capital base and enhanced financial flexibility to pursue emerging opportunities. The Companys core thermal power assets continued to deliver stable operational performance, underscoring the strength and reliability of its operating platform.
Having strengthened its foundations through operational discipline, prudent capital management, and portfolio optimization, GPUIL is well positioned to pursue sustainable growth opportunities and create long-term value for stakeholders.
On the global economic front, the year continued to be shaped by trade and tariff policies pursued by the United States, which kept global supply chains and cross-border investment decisions in a state of flux. While inflation in several advanced economies moderated further, allowing central banks room to continue easing monetary policy, the pace of these cuts remained uneven and contingent on how trade frictions evolved. Governments across the world continued to prioritize economic security, on shoring of critical supply chains and strategic autonomy, reinforcing the broader shift towards protectionism and selective trade partnerships that began in earlier years.
Climate change, energy security and the race for leadership in green technologies and critical minerals remained prominent items on the global agenda throughout the year. The growing dependence of economies on digital and AI-linked infrastructure also kept cybersecurity concerns elevated, with the risk of state- sponsored disruption continuing to weigh on policymakers minds.
The most consequential development came late in the financial year, with the outbreak of armed conflict in West Asia. The resulting disruption to energy flows including the closure of the Strait of Hormuz and damage to critical energy infrastructure across various countries in West Asia triggered a supply squeeze resulting in sharp rise in prices of crude oil, gas, and refined products. This altered the global inflation trajectory and introduced significant uncertainty to global growth trajectory in near to medium term.
In summary, FY 2025-26 continued to be marked by an unsettled geopolitical environment, with ongoing conflicts, shifting alliances and intensifying competition between major powers, shaping the pace and direction of global trade and investment. This backdrop continues to present both risks and opportunities for countries and companies navigating the transition to a more fragmented, yet increasingly technology-driven, global order.
Against this uncertain global setting, Indias economy continued to stand out for its relative resilience. As per the provisional estimates released by the government, Indias real GDP grew by 7.7% in FY 2025-26, an acceleration from the 7.1% growth recorded in FY 2024-25, aided by robust growth in manufacturing and services and continued momentum in government capital expenditure, even as agricultural growth moderated. Retail inflation stayed largely range-bound through the year, giving the Reserve Bank of India room to maintain an accommodative policy stance. Despite global uncertainties, India sustained its position as one of the fastest-growing major economies, with the Government reiterating its ambition of becoming the worlds third-largest economy in the coming years.
Economic overview Global economic scenario
PY 2024 was a challenging year for global growth, impacted by high inflation and high interest rates across major economies. As a result, global growth remained stagnant at approximately
3.3%.
CY 2025 proved more resilient than initially feared. As the world entered 2025, a series of unprecedented tariff measures were announced by the US, due to which trade paradigm across the world was disrupted. Throughout the year uncertainty around US tariffs continued even as various countries took counter measures to balance the impact of new tariffs.
Geopolitical developments in West Asia emerged as a significant macroeconomic headwind during the period. The conflict which started between US-Israel and Iran eventually engulfed the broad West Asia region affecting global energy trade thus driving volatility in commodity prices, increasing transportation and logistics costs, and disrupting supply chains. These factors contributed to inflationary pressures across countries and heightened uncertainty for businesses and investors, as companies operated in an environment characterized by elevated costs and increased geopolitical risk. The resulting supply concerns further underscored the importance of energy security, leading many countries to accelerate investments in domestic energy production, renewable energy, energy storage and other measures aimed at enhancing long-term resilience of their energy supplies.
Despite elevated policy uncertainty, and geopolitical disturbances, global growth came in at an estimated 3.5% in 2025. This resilience reflected the increasing agility with which countries adapted to trade realignment front-loading of shipments, rerouting of supply chains and the negotiation of new bilateral arrangements. Trade policy uncertainty also began to ease towards the end of 2025, as a ruling of the US Supreme Court in January 2026 invalidated tariffs imposed under the International Emergency Economic Powers Act, lowering the effective tariff rate faced by trading partners, even though some measures were subsequently re-introduced under alternative legal provisions.
Performance across the major economies diverged. The United States GDP expanded by 2.1% in 2025, ending the year with stronger-than-expected momentum, supported by surging AI- related investment, fiscal impetus including tax incentives for corporate investment and monetary easing. As per IMF estimates, US growth is projected at 2.3% for 2026 and 2.2% for 2027.
In the Euro Area, domestic demand strengthened through 2025 as lower interest rates supported consumption and investment, and the economy expanded by 1.4% during 2025. The European Central Bank cut its deposit facility rate from 3.75% in June 2024 to 2.00% in June 2025 through eight successive rate reductions. However, the escalation of the West Asia conflict in 2026, in addition to the ongoing Russia Ukraine conflict further fuelled energy prices and inflationary pressures, prompting the ECB to raise the rate by 25 bps to 2.25% in June 2026. Despite resilient household demand, higher energy costs, weaker business confidence and geopolitical uncertainty weighed on growth prospects, leading the IMF to revise its 2026 Euro Area GDP growth forecast to 0.9%.
China continued to face weakness in its real estate sector and subdued domestic consumer confidence through 2025, even as exports remained a relative bright spot. In addition, trade tensions with the US persisted for most of the year, though an easing of tariffs towards the end of 2025 provided some relief. Chinas GDP grew by ~5% in 2025, broadly in line with 5% in 2024. As per the IMFs latest forecast, Chinese economy growth rate is expected to moderate further to 4.6% in 2026, with additional fiscal support helping cushion the impact of the West Asia conflict on the broader economy.
Way forward
Entering 2026, the global economy appeared poised for a stronger recovery, with the International Monetary Fund (IMF) preparing to revise its growth forecasts upward. However, the outbreak of conflict in the West Asia abruptly disrupted this positive trajectory. The closure of the Strait of Hormuz and significant damage to critical energy infrastructure heightened concerns of a severe global energy shock. Consequently, prices of oil, natural gas, diesel, aviation turbine fuel, fertilisers, and several industrial commodities surged sharply, intensifying inflationary pressures and clouding the global economic outlook.
The IMF, assuming the conflict remains limited in duration and scope projects global growth to slow to 3.0% in 2026 and 3.4% in 2027, below recent projections. Crude oil, which averaged USD 67.74 per barrel in 2025, is assumed at USD 82.22 per barrel for 2026. Global headline inflation is projected at 3.9% in 2026 before resuming its decline in 2027, with pressures concentrated in emerging market and developing economies, particularly commodity importers.
Risks of deviation from this outlook are decisively on the downside. A longer or broader conflict, deepening geopolitical fragmentation, a reassessment of expectations surrounding AI- driven productivity and trade tensions could significantly weaken growth and destabilize financial markets, while elevated public debt levels and eroding policy buffers, thus heightening vulnerabilities. Under the IMFs adverse scenarios, a sustained escalation in energy prices would produce materially weaker growth and higher inflation outcomes.
Nevertheless, recent history has consistently shown that the global economy is more resilient than often anticipated, with countries demonstrating remarkable agility and pragmatism in responding to emerging challenges. In an increasingly multipolar world marked by economic nationalism, evolving alliances, and shifting trade relationships, the underlying drivers of growth— global trade, investment flows, and connectivity—are expected to remain robust and continue supporting the expansion ofthe global economy.
Indian economic scenario
While the global economy navigated trade realignment and shocks from conflict in the West Asia, India delivered one of its strongest years of growth and remained the fastest-growing major economy in the world.
As per RBI, Indias real GDP grew by 7.7% in FY 2025-26, compared with 7.1% in FY 2024-25, with nominal GDP expanding by 8.9%. Momentum strengthened throughout the year, with quarterly growth peaking at 8.2% in Q2. Growth was broad-based, driven by resilient domestic consumption, sustained public capital expenditure, a recovery in private investment and buoyant services activity.
A defining feature of the year was the exceptionally benign inflation environment through the first three quarters. Headline CPI inflation declined for nine consecutive months to touch an 8-year low of 1.6% in July 2025 and eased further to historic lows of around 0.25% in October 2025, aided by a prolonged correction in food prices, the longest such decline in the CPI series. The rationalization of GST rates effective September 22, 2025 ("GST 2.0"), which directly impacted around 11.4% of the CPI basket, provided a further structural impetus to disinflation, alongside the reduction in direct tax rates effective FY 2025-26 which bolstered household disposable incomes. CPI inflation for the full year averaged approximately 2.1%.
Low inflation provided the Reserve Bank of India ("RBI") room to support growth. Having reduced the repo rate from 6.5% to 5.5% over the preceding easing cycle and having committed to a phased 100 basis point reduction in the Cash Reserve Ratio to 3%, the RBI delivered a further 25 basis point cut in December 2025, taking the repo rate to 5.25%. Reflecting this environment of ample liquidity and strong growth, gross GST collections for FY 2025-26 rose 8.3% to 22.27 Lakh Crore, with March 2026 collections crossing 2 Lakh Crore in a month for the first time during the fiscal year. Indias sovereign credit rating was upgraded by S&P Global in August 2025, reflecting sustained fiscal consolidation and macroeconomic stability, and the RBI approved a record surplus transfer of 2.86 Lakh Crore to the Government for 2025-26.
Fiscal discipline remained a source of macro economic credibility. The Central Government held the fiscal deficit for FY 2025-26 at 4.4% of GDP thereby fulfilling the commitment made in FY 202122 to bring the fiscal deficit below 4.5% of GDP by FY 2025-26, which was achieved despite the revenue foregone from direct tax relief and GST rationalization while sustaining public capital expenditure of approximately 11 Lakh Crore during FY 2025-26. The Union Budget for FY 2026-27 marked a structural evolution in the fiscal framework, transitioning from fiscal-deficit targeting to a debt-anchored path: the Central Government now targets a debt-to-GDP ratio of 50% (?1%) by March 2031 and 55.6%
budgeted for FY 2026-27 from 56.1% in FY 2025-26. Fiscal deficit for FY 2026-27 budgeted at 4.3% of GDP. A declining debt ratio is expected to progressively free up resources from interest outgo toward priority and capital expenditure reinforcing the medium- term visibility of public infrastructure.
On the geopolitical front, west asia conflict altered the inflation and growth calculus materially. Brent crude, which had traded in the range of USD 60-70 per barrel for much of the year, crossed USD 110 per barrel following the outbreak of hostilities. As a large net energy importer, India is directly exposed to this channel through fuel costs, the trade deficit and the currency.
For the power sector, elevated global energy prices resulted in higher generation costs for gas-based power plants and exerted upward pressure on imported coal prices, underscoring the strategic importance of strengthening domestic energy security. These developments reinforced the imperative to accelerate investments in renewable energy capacity, battery energy storage systems (BESS), and grid modernization from Indian perspective. Together, these initiatives are expected to enhance system resilience, reduce dependence on imported fuels, and mitigate exposure to volatility in global energy markets over the long term.
The external account, however, came under visible pressure, particularly in the final quarter. The merchandise trade deficit widened to USD 333.2 Bn in FY 2025-26 from USD 283.5 Bn in the previous year, as imports grew 7.6% while exports remained broadly flat.
As a result of the above factors, Indian Rupee depreciated by over 11% against the US Dollar during FY 2025-26, the steepest annual fall since FY 2011-12, breaching Rs. 95 per USD.
Foreign Portfolio Investors (FPIs) remained net sellers for a significant part of FY 2025-26, with outflows accelerating sharply following the outbreak of the West Asia conflict in the latter part of the year. Investor sentiment was adversely impacted by the depreciation of the Indian Rupee, a widening external sector imbalance, and the relative attractiveness of technology-driven investment opportunities in the United States and other developed markets. Despite these outflows, domestic institutional investors (Dlls) provided a strong counterbalance, supported by robust domestic savings flows and sustained investor confidence in Indias long-term growth prospects.
Despite these headwinds, Indias external buffers remained strong. Foreign exchange reserves stood at USD 691 Bn at the end of March 2026, an increase of approximately USD 23 Bn over the year, supported largely by valuation gains arising from higher gold prices. The robust reserve position provided an important cushion against external volatility and reinforced confidence in Indias macroeconomic stability.
India made significant progress in expanding its global trade architecture during FY 2025-26, with its Free Trade Agreement ("FTA") network growing to nine agreements spanning 38 countries. Landmark developments included the implementation of the India-Europe Trade and Economic Partnership Agreement ("TEPA"), the signing of the India-UK trade agreement, and the conclusion of negotiations for the India-New Zealand FTA and India-Oman Comprehensive Economic Partnership Agreement ("CEPA"). Progress on an interim trade framework with the United States and the launch of GCC trade negotiations further strengthened Indias integration with key global markets. These developments are expected to improve export competitiveness, attract investment inflows, diversify trade partnerships, and support long-term economic growth.
Indias expanding networkoftrade and investment agreements is expected to create a supportive environment for the power sector by improving access to advanced technologies, long-term capital, and global supply chains. Enhanced engagement with strategic partners can accelerate investments in renewable energy, battery energy storage systems, transmission infrastructure, and green hydrogen. At the same time, greater integration with global markets is expected to support domestic manufacturing of power equipment, strengthen energy security through supply chain diversification, and facilitate the modernization of Indias electricity ecosystem. These developments are likely to play an important role in supporting the countrys long-term decarbonization, energy transition, and power demand growth objectives.
Way forward
India enters FY 2026-27 with strong domestic fundamentals but a more challenging external environment. In June 2026, the RBI held the repo rate at 5.25% with a neutral stance and revised its projections to reflect the post-conflict reality. GDP growth for FY 2026-27 is now projected at 6.6% (lowered from 6.9%), while CPI inflation is projected at 5.1% (raised from 4.6%), reflecting the pass-through of elevated energy and commodity prices.
Policy attention has turned to safeguarding external stability. Alongside the June 2026 policy, the RBI and the Government
announced a package of measures to attract foreign capital including expansion of the Fully Accessible Route for government securities, exemption of foreign institutional investors from capital gains tax effective April 1, 2026, concessional forex swap facilities for external commercial borrowings, and support for fresh FCNR(B) deposits.
The medium-term drivers of Indias growth remain firmly intact: favourable demographics, rising discretionary incomes supported by direct and indirect tax rationalization, a vibrant start-up ecosystem, sustained public infrastructure investment under a credible debt-anchored fiscal path, and the implementation runway of the newly concluded trade agreements. While elevated energy prices and currency pressure present near-term headwinds, still Indias relative growth premium over other major economies is expected to endure.
Infrastructure Initiatives
The Indian Government has taken various initiatives to achieve its ambition of Viksit Bharat (India as a developed nation) by 2047. The government has particularly stepped-up infrastructure spending outlay. In the Union Budget for FY 2026-27, public capital expenditure allocation was increased to Rs. 12.2 Lakh Crore, up from Rs. 11.2 Lakh Crore in FY 2025-26, building on Rs. 2 Lakh Crore allocation in FY 2014-15. This represents continued momentum in infrastructure-led growth, even as the fiscal deficit was lowered to 4.3% of GDP.
To increase private sector participation in infrastructure projects, Ministries have been guided to develop a three-year pipeline of projects to be implemented in PPP mode. State governments are also being encouraged to follow the same path. An Infrastructure Risk Guarantee Fund has also been proposed to provide partial credit guarantees and de-risk private investment during the construction phase. Additionally, for capital expenditure and to incentivize infrastructure reforms, Rs. 1.85 Lakh Crore is allocated for states in FY 2026-27 in the form of 50-year interest free loans, up from Rs. 1.44 Lakh Crore for FY 2025-26. The enhanced allocation is expected to support capital formation by States, accelerate the development of logistics and industrial infrastructure, and promote wider adoption of PPP-led infrastructure projects across the country.
The Government continues to recognize energy security as a critical enabler of sustainable economic development. Reflecting this commitment, the Union Budget FY 2026-27 has significantly enhanced allocations towards the power and renewable energy
sectors. The budgetary allocation for the Ministry of New and Renewable Energy (MNRE) has been increased from Rs. 25,301 Crore in FY 2025-26 to Rs. 32,915 Crore in FY 2026-27, with the PM Surya Ghar Muft Bijli Yojana accounting for the largest share at Rs. 22,000 Crore. Further, the Ministry of Power has been allocated Rs. 29,997 Crore in FY 2026-27, representing a 39% increase over allocation for FY 2025-26. These measures are expected to support renewable energy deployment, strengthen power distribution infrastructure, and advance Indias long-term energy security objectives.
Advancing efforts to strengthen power distribution infrastructure and reduce Aggregate Technical and Commercial (AT&C) losses, the Government has allocated around Rs. 18,000 Crore in the Union Budget FY 2026-27 towards the Revamped Distribution Sector Scheme (RDSS). The scheme forms part of a broader programme with a total outlay of Rs. 3.04 Lakh Crore, including central grant support of Rs. 97,631 Crore, aimed at improving operational efficiency, enhancing financial sustainability of State DISCOMs, expanding smart metering, and modernizing distribution infrastructure. Further, to incentivize implementation of power sector reforms, States are eligible for an additional borrowing limit of up to 0.5% of Gross State Domestic Product (GSDP), subject to achievement ofspecified reform milestones.
In addition, the Government has set an ambitious target of achieving 100 GW of nuclear power capacity by 2047, compared with the current installed capacity of about 8 GW. To support this objective, the Nuclear Energy Mission for Viksit Bharat, focused on research, development and deployment of Small Modular Reactors (SMRs). The Mission envisages operationalization of at least five indigenously developed SMRs by 2033 and is expected to play a key role in strengthening the countrys clean and reliable baseload power capacity. Further, the introduction of the Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Bill, 2025 reflects the Governments continued focus on strengthening the nuclear power sector through a modernized regulatory framework and enhanced investment opportunities to support Indias long-term clean energy and energy security objectives.
On the renewable energy front, sector is increasingly transitioning towards Firm and Dispatchable Renewable Energy (FDRE) solutions, which integrate renewable generation with energy storage to provide round-the-clock and demand-responsive power supply. This shift reflects the growing importance of storage technologies in enhancing grid stability, improving renewable energy integration and addressing intermittency challenges. Recognising this requirement, the National Electricity Plan envisages the deployment of around 236 GWh of battery energy storage capacity by 2031-32. To support the accelerated adoption of storage infrastructure, the Ministry of Power approved an expanded Viability Gap Funding (VGF) support of Rs. 5,400 Crore in June 2025 for the deployment of an additional 30 GWh (30,000 MWh) of Battery Energy Storage Systems (BESS), equivalent to approximately Rs. 18 lakh per MWh of storage capacity. The initiative is expected to attract investments of about Rs. 33,000 Crore, while a minimum 20% domestic content requirement has been mandated for VGF-supported projects to promote domestic manufacturing and strengthen the energy storage ecosystem.
The National Green Hydrogen Mission, launched with an outlay ofRs. 19,744 Crore until FY 2029-30, aims to establish India as a global hub for green hydrogen production and exports.
To promote self-reliance across clean energy supply chains, the Government has launched the National Manufacturing Mission and introduced a range of measures to strengthen domestic manufacturing capabilities in strategic sectors, including solar photovoltaic (PV) cells and modules, wind turbines, electric vehicle (EV) batteries, grid-scale battery energy storage systems and power transmission equipment. In addition, customs duty concessions on critical minerals and select capital goods used in battery manufacturing have been announced to reduce input costs, enhance competitiveness and support the development of a robust domestic clean energy manufacturing ecosystem. These measures are expected to accelerate investments, reduce import dependence and strengthen Indias position in the global energy transition value chain.
The Government continues to support the adoption of electric mobility through targeted policy interventions. Complementing the earlier FAME-II programme, the PM E-DRIVE scheme supports the development of public charging infrastructure across the country, including along major national highway corridors. These initiatives are expected to strengthen the EV ecosystem, accelerate electric vehicle adoption, and support Indias broader energy transition and decarbonization objectives.
Recognising the critical role of transport infrastructure in enhancing economic productivity, improving connectivity and reducing logistics costs, the Government continued to prioritize investments in the road sector. The Union Budget FY 2025-26 increased the allocation to the Ministry of Road Transport & Highways (MoRTH) to 2.87 Lakh Crore, representing a 2.4% increase over last years allocation.
Complementing the expansion of the national transport network, the Union Budget FY 2026-27 announced a new East-West Dedicated Freight Corridor (DFC) connecting Dankuni in West Bengal with Surat in Gujarat. Spanning approximately 2,316 km, the corridor will be developed by the Dedicated Freight Corridor Corporation of India Limited (DFCCIL) and traverse several industrial and mineral-rich regions across eastern and central India. The proposed corridor will connect with the Eastern DFC at Dankuni and integrate with the Western DFC network in Gujarat, creating a seamless freight transportation grid linking key manufacturing centres, mineral belts and major west-coast ports. Designed for high-capacity freight movement, with higher axle loads, double-stack container operations and speeds of up to 100 kmph, the corridor is expected to reduce logistics costs, decongest existing rail networks, improve supply-chain efficiency and strengthen Indias multimodal logistics infrastructure.
Impact on sectors in which GPUIL operates
The Governments continued focus on policy reforms and infrastructure development has provided a strong impetus to the infrastructure sector. As a critical enabler of economic growth, the power sector remains central to Indias development trajectory, with electricity demand continuing to rise alongside expanding economic activity. Accordingly, the Government has
maintained a sustained focus on strengthening power infrastructure, enhancing generation capacity, and ensuring longterm energy security. At the same time, over the past decade, significant emphasis has been placed on accelerating the transition towards clean energy to support Indias decarbonization objectives, reduce dependence on fossil fuel imports, and build a more sustainable and resilient energy ecosystem.
As a result, the power sector has witnessed sustained expansion over the past decade, with Indias total installed generation capacity increasing from approximately 302 GW at the end of FY 2015-16 to about 549 GW as of30June 2026.
distribution transformers and feeders in India. As per the National Smart Grid Mission dashboard (March 2026), 20.33 Crore smart meters have been sanctioned under RDSS, with contracts for over 12 Crore meters already awarded to AMISPs. Cumulative smart meter installations (RDSS and other State schemes combined) have crossed 6.13 Crore, translating into physical progress of over 24% against the 25 Crore meter target, and the installation timeline under the scheme has been extended to March 2028.
While Indias power generation capacity has been increasing significantly, government also recognized a need to improve power distribution network infrastructure. To further this objective, the government earlier launched the Revamped Distribution Sector Scheme (RDSS) setting an ambitious target to install 250 million smart consumer meters along for all
On the green hydrogen ecosystem front, as of February 2026, approximately 8,000 tonnes per annum of green hydrogen production capacity had been commissioned in India. In parallel, competitive bidding under the Strategic Interventions for Green Hydrogen Transition (SIGHT) programme has facilitated the award of green hydrogen production and electrolyzer manufacturing capacities. These measures are expected to strengthen domestic manufacturing capabilities, catalyze private sector investment and position India as a global hub for green hydrogen production, usage and exports.
The rapid growth of energy storage systems and Firm and Dispatchable Renewable Energy (FDRE) projects is creating new opportunities across the energy value chain. The increasing deployment of battery energy storage systems and FDRE solutions is expected to enhance grid flexibility, improve system reliability and facilitate deeper integration of renewable energy into the power grid.
The electric mobility ecosystem has also witnessed significant progress. As of March 2026, India had 27,737 public EV charging stations, of which 22,753 were operational, reflecting a substantial expansion in charging infrastructure across the country. The sector is expected to witness continued growth, creating longterm opportunities in charging infrastructure, power systems and associated energy services.
On the transport infrastructure front, National Highway network in India increased by -61% to 1, 46,560 Km at present (December 2025) from 91,287 Km as on March 31, 2014, with the pace of highway construction rising from 12.1 Km per day in 2014-15 to nearly 29 Km per day in 2024-25. The length of 4-lane and above National Highways, including access-controlled corridors, has more than doubled from 18,371 Km as on March 31, 2014 to 43,512 Km at present. Within this, the length of operational access-controlled High-Speed Corridors (HSCs)/Expressways has grown from a mere 93 Km in 2014 to 3,052 Km at present.
The Governments continued focus on expanding freight rail infrastructure, including the proposed East-West Dedicated Freight Corridor connecting Dankuni and Surat. As the project advances through planning and implementation stages, it is likely to generate a significant pipeline of railway EPC opportunities over the medium term. Given the Companys proven track record in the execution of dedicated freight corridor projects, it is well positioned to participate in these opportunities and contribute to the development of critical national rail infrastructure.
Overall, the continued expansion of energy, transport and logistics infrastructure, supported by sustained policy reforms and public investment, is expected to create long-term growth opportunities across the power, renewable energy, smart metering, EPC and emerging energy businesses. The Company is well positioned to capitalize on these growth opportunities.
Key Developments at GPUIL
The Company has, over the past few years, stayed on the course of its stated strategy of strengthening the balance sheet through improved cash flows, debt reduction via asset monetization, value unlocking and prudent working capital management, while simultaneously building new avenues for growth. FY 2025-26 saw this strategy advance further, with several of the initiatives set in motion in the previous year reaching completion, and new steps taken to expand the Companys presence in next-generation energy businesses.
Some of the key initiatives undertaken by the Company during the year are set out below:
1. Monetization of select energy assets
Pursuant to the framework agreement executed in April 2025 with Synergy Investments Holding Limited ("Synergy") for the divestment of the Companys stakes in Bajoli Holi Hydropower Private Limited ("Bajoli Holi"), GMR Vemagiri Power Generation Private Limited ("Vemagiri") and GMR Rajahmundry Energy Limited ("GREL"), the transaction moved substantially towards completion during FY 202526. GMR Energy Limited ("GEL") transferred 70% of its equity holding in Bajoli Holi to Synergy in May 2025, with the residual stake structured to transfer at a later date. Further, 51% stakes in Vemagiri was transferred by GEL and 51% stake in GREL was transferred by GMR Generation Assets
Limited in July 2025. Proceeds from this transaction enabled the Company, and/ or subsidiary to meet its One-Time Settlement obligations towards GRELs lenders and has contributed to a further reduction in the Groups consolidated debt.
2. Preferential issuance of equity shares and warrants
The Board of Directors approved the preferential issuance of equity shares and convertible warrants for a total consideration of approximately Rs. 1,200 Crore in December 2025. Upon subsequently receiving the requisite approvals from Shareholders and the stock exchanges, GPUIL allotted approximately 6.62 Crore equity shares of Rs. 5/- each at an issue price ofRs. 120.88 per share, together with approximately 3.31 Crore warrants at the same price, of which 25% of the consideration was received at the time of allotment, in January 2026 (allotment date: January 28, 2026). The warrants are convertible into equity shares within 18 months of allotment upon payment of the balance consideration. As a result of this preferential issue, the Companys total equity capital increased from around 71.48 Crore to around 78.10 Crore shares and is expected to rise further to approximately 81.4 Crore shares on full conversion of the warrants. The capital raised is intended to strengthen the Companys balance sheet and support its growth plans, particularly in the renewable energy and smart meter infrastructure businesses.
3. Favourable Supreme Court rulings in respect of GMR Kamalanga Energy Limited ("GKEL")
On September 08, 2025, the Honble Supreme Court of India dismissed the civil appeals filed by the Distribution Licensees of Haryana and GRID Corporation of Odisha Limited ("GRIDCO"), upholding the Appellate Tribunals judgment of 20 December 2019 and confirming that linkage coal received by GKEL is to be allocated on a pro-rata basis among the beneficiaries of the project (Haryana, Bihar and Odisha), rather than being attributed to individual Power Purchase Agreements. Following thejudgment, Haryana DISCOM paid GKELs entire outstanding claim of approximately Rs. 1,140 Crore, together with applicable interest as per the terms of the PPA.
Separately, on September 26, 2025, the Honble Supreme Court of India upheld the Orissa High Courts judgment setting aside an arbitral award that had been in favour of SEPCO (the EPC contractor for GKEL), confirming that GKEL has no liability under that award.
4. Strategic initiatives at GKEL
During FY 2025-26, GMR Energy Limited (GEL) undertook key strategic initiatives to strengthen its position in GKEL and enhance the subsidiarys financial profile. In March 2026, GEL acquired the residual 2.37% equity stake held by IDFC First Bank Limited, resulting in GKEL becoming a wholly owned subsidiary of GEL.
In addition, during the third quarter of FY 2025-26, GKEL successfully re-financed its senior debt through a fresh loan facility ofRs. 2,700 Crore. This refinancing reduced the average cost of borrowing from approximately 12.15% per annum
to 9.50% per annum, with the potential for a further reduction to 9.25% per annum upon a credit rating upgrade.
GKEL is also progressing plans for the addition of a 350 MW Unit IV at its Kamalanga thermal power plant in Odisha, which is expected to strengthen the plants generation capacity and support future growth opportunities
5. Foray into C&I renewable energy portfolio
In November 2025, GEL incorporated GMR Kalinga Solar Power Limited to develop a 10 MW solar power project in Kamalanga, Odisha, for which a Power Purchase Agreement has been executed;this was followed by the incorporation of GMR Utkal Solar Power Limited in Dec25 for development of another solar project in Kamalanga. In March 2026, GEL incorporated GMR Karnataka Renewable Energy-I Limited and GMR Andhra Pradesh Renewable Energy-I Limited, with an initial focus on Commercial & Industrial ("C&I") supply and hybrid / Firm and Dispatchable Renewable Energy ("FDRE") solutions. These are early steps taken in line with the Companys stated intent to build a meaningful renewable generation portfolio.
6. Progress in the Smart Metering Business
GMR Smart Electricity Distribution Private Limited (GSEDPL), through its three project SPVs is implementing the Kashi, Triveni and Agra smart metering projects for Uttar Pradesh DISCOMs.
The project implementation is in progress, with approximately 3.9 million smart meters installed as of April 2026, against the total contracted scope of 7.57 million meters. The scope of the contract is expected to expand through additional variation orders from the State, of which an order for 1.02 million meters has already been received.
Energy Sector Outlook and Future Plan Global Power Sector Overview
The global power sectors transition towards cleaner sources of generation accelerated in 2025, with worldwide electricity generation increasing by over 850 TWh. Growth was driven entirely by low-emission technologies, as the combined increase in renewable and nuclear generation exceeded the total rise in electricity output, enabling a modest reduction in fossil fuel-based generation. Renewables accounted for the majority of incremental supply, underscoring the continued shift towards a lower-carbon global power mix. Renewables accounted for most of the incremental generation, with global renewable power generation growing by around 8.5% YoY. Solar PV recorded its largest-ever annual increase, adding nearly 600 TWh of generation, while renewable generation globally almost matched coal-fired generation in 2025. Battery Energy Storage Systems (BESS) also scaled rapidly, with 108 GW of new battery storage capacity deployed globally in 2025, up 40% YoY, with around 80% of additions coming from utility-scale projects, supporting renewable integration, grid flexibility and peak management.
Coal remained a key source of global electricity supply, but coal- fired generation declined by around 0.5%, marking the first noncrisis-related decline since 2015. Natural gas generation increased modestly, while nuclear generation reached a record high of 2,667
TWh in 2024, supported by reactor restarts and new capacity additions in select markets.
Going forward, the sector is expected to be shaped by rising electrification, grid modernisation, storage deployment, data centre demand, and integration of high renewable capacity. However, grid flexibility, transmission constraints, energy security and affordability will remain key challenges for utilities and power producers globally.
Indian Economy - Power Sector Scenario FY 2025-26
Indias economy continued its steady expansion in FY 2025-26, aided by broad-based growth across manufacturing, services and investment. In spite of tremendous economic growth, Indias per capita electricity consumption remains modest, at around 1,460 KWh for 2025-26 (as per Ministry of Power data) vs 1,380 KWh in 2024-25. We continue to trail the global per capita consumption of approximately 4,000 KWh. Thus, there remains a significant headroom for power demand across India as the economy continues to expand and living standards rise.
Indias power demand continued to see structural growth during the year, driven by four key forces. Climate change is pushing up average surface temperatures, increasing cooling-related power demand, further compounded by rapid urbanization. The explosive growth of data centres and AI is set to add meaningfully to this demand — data centre power consumption is expected to contribute -4% of Indias total power demand by FY 32, rising sharply to 9-10% by FY 47. The rise of electric vehicles is another growing contributor, with EV charging expected to account for ~1% of total power demand by FY 32, growing to -5-10% by FY 47. Finally, manufacturing, electrification, and broader GDP growth — spanning steel, cement, batteries, and semiconductors, alongside the substitution of fossil fuels with electricity across industrial processes, continue to add sustained structural demand
Indias power sector expanded in FY 2025-26, with total installed capacity reaching 532.7 GW as on March 31, 2026. Non-fossil capacity stood at 283.5 GW, accounting for 53.2% of total installed capacity, while fossil capacity stood at 249.3 GW or46.8%.
Renewables remained the key growth driver, with solar capacity at 150.3 GW and wind capacity at 56.1 GW as on March 31, 2026. Solar alone contributed 28.2% of Indias installed capacity, while wind contributed 10.5%, reflecting Indias accelerating clean energy transition. Battery Energy Storage Systems (BESS) also started gaining traction, with CEA listing commissioned/in- operation BESS capacity up to May 2026 at -7.5 GWh (4.9 GWh in merchant mode, with additional -3 GWh worth capacity expected to come online by December 26). CEA has estimated Indias storage requirement at -336 GWh by FY30 to support renewable integration and grid reliability. Hydro, including pumped storage, stood at 51.4 GW, supporting grid flexibility and balancing requirements amid rising renewable penetration. Nuclear capacity stood at 8.8 GW, forming part of Indias longterm clean baseload strategy.
The Government has also outlined a roadmap to scale nuclear capacity to 100 GW by 2047, positioning nuclear as a stable, low- carbon source to complement intermittent renewable generation.
Power supply reliability continued to improve, with Indias power shortage reducing to 0.03% till December 2025, supported by sustained capacity addition and grid strengthening.
While renewable energy continued to gain share in the generation mix during FY 2025-26, thermal power remained the dominant source of electricity supply, continuing to play an important role in meeting base-load requirements and supporting overall system stability as power demand continued to grow.
As per Central Electricity Authority estimates released as part of its Long-Term National Resource Adequacy Plan (2026-36), India is expected to require substantial additional coal-based capacity over the coming decade, alongside a large pipeline of renewable, storage and nuclear capacity, to reliably meet projected peak demand of about 459 GW by 2035-36, from 242.49 GW during FY 2025-26. As per CEA, the projected thermal (coal and lignite) capacity requirement by the year 2034-35 is estimated at approximately 307 GW from current 251 GW.
Domestic coal (including lignite) production for FY 2025-26 stood at approximately 1.08 billion tonnes, broadly stable with a marginal decline of around 1% compared to the previous year, reflecting softer thermal dispatch even as production capacity remained robust. Coal stock positions at domestic coal-based power plants remained healthy through the year, supported by the revised SHAKTI coal-linkage policy notified in 2025, with stocks targeted to rise to around 66 million tonnes by March 2026 from about 51.7 million tonnes in December 2025.
Alongside conventional coal-based generation, the Government continues to promote coal gasification as a cleaner and higher- value use of domestic coal resources. India has set a target of gasifying 100 million tonnes of coal by 2030 and has approved an incentive outlay of Rs. 46,000 Crore to support coal and lignite gasification projects, creating opportunities across chemicals, fertilisers and industrial feedstockvalue chains.
Outlook:
Indias medium-term power demand is expected to remain structurally strong, driven by economic growth, industrialization, data centres, electric mobility, urbanization and rising household consumption. In FY 2025-26, CEA data indicates peak demand of 245.4 GW and unmet demand of only 28 MW (0.01%), reflecting near-complete supply adequacy. This year we have already witnessed peak demand of -270 GW in month of May26 and Jul26. Energy requirement for FY 26 stood at approximately
1.708.8 BU, against supply of 1,708.2 BU, translating into a marginal shortage of only -0.03%.
As per CEAs National Electricity Plan, Indias peak demand is projected to rise to 277.2 GW by FY 2026-27 and 366.4 GW by FY 2031-32, while energy requirement is expected to increase to
1.907.8 BU and 2,473.8 BU, respectively. To meet this, installed capacity is projected to expand to 609.6 GW by FY 2026-27 and 900.4 GW by FY 2031-32, indicating that India is planning capacity addition ahead of demand growth.
While renewable capacity addition will accelerate, thermal power and energy storage will remain critical for grid stability, peak demand management and round-the-clocksupply. CEA projects coal-based capacity at 235.1 GW by FY 2026-27 and 259.6 GW by FY 2031-32, with coal PLF expected to remain around 5859%, reinforcing the role of efficient dispatchable generation. CEA projects BESS capacity addition - 305 GWh and 175GWh of PSPs for Energy storage by FY 32.
Overall, India appears well-positioned to meet projected demand, provided planned generation, storage and transmission capacity are executed on schedule. For GMR Energy, this creates opportunities across efficient thermal operations, renewable growth, storage-linked solutions, smart metering and participation in evolving power market reforms.
While optimizing the operational performance of its existing generation assets, the Company has continued to execute its growth roadmap, aimed at building a diversified, future-ready energy platform.
In this direction, GKEL is progressing with plan to add a 350 MW Unit 4 at its Kamalanga plant in Odisha.
In the Smart Metering business, the Company installed close to 3.9 million smart meters by April 2026 under its AMISP projects for Uttar Pradesh DISCOMs, against a contracted base of 7.57 million meters. The scope of the contract is expected to expand through additional variation orders from the State, of which an order for 1.02 million meters has already been received. The Company also continued to build capabilities in data analytics, customer engagement and energy efficiency services, supporting its presence across multiple segments of the smart utility value chain.
The year also marked the beginning of our efforts to strengthen GPUILs presence in the renewable energy value chain. While these initiatives represent the initial phase of thisjourney, they establish a strong foundation for future growth.
These initiatives reflect the Companys focus on diversifying its generation portfolio, reducing its carbon footprint and establishing a presence in fast-growing renewable energy markets. The Company also continues to evaluate opportunities to utilize available land banks at its existing project locations for future renewable energy development.
The Companys engagement in power trading is expected to deepen further as Indias electricity markets become more dynamic and real-time in nature, with continuing exploration of opportunities across the Day-Ahead Market, Real-Time Market, Green-Day-Ahead Market and emerging green power corridors, underpinned by a strong technology backbone.
As India advances its transition towards a cleaner and more resilient energy future, the Company remains focused on aligning its strategic priorities with emerging sector trends and is well positioned to capture opportunities arising from this transformation.
Transportation and Urban Infrastructure Sector Outlook and Future Plan
Transportation
Railways
The Group made a significant entry into the railway EPC sector in 2015 with the award of two Eastern Dedicated Freight Corridor (EDFC) packages by DFCCIL. Spanning approximately 422 km between New Bhaupur and New Deen Dayal Upadhyaya Junction in Uttar Pradesh, the projects were completed and commissioned successfully, with all defect liability obligations subsequently discharged.
Further strengthening its presence in the sector, the Group secured two additional EDFC packages from DFCCIL in 2016 covering the Ludhiana-Khurja-Dadri corridor across Punjab, Haryana and Uttar Pradesh. These projects have also been commissioned successfully, demonstrating the Groups ability to deliver complex, nationally significant rail infrastructure projects.
Looking ahead, the Group will continue to evaluate emerging opportunities in the railway infrastructure sector through both EPC and Public-Private Partnership (PPP) models. A key opportunity is the proposed East-West Dedicated Freight Corridor, recently announced by DFCCIL, spanning approximately 2,300 km from Dankuni in West Bengal to Palghar/Surat in Gujarat. Leveraging its experience in delivering major dedicated freight corridor projects, the Group intends to actively explore participation in this programme.
Beyond track construction, the ongoing opening of the railway sector to private participation is creating new avenues in the operation and maintenance (O&M) of rail infrastructure. The Group will continue to evaluate such opportunities as part of its strategy to build a diversified portfolio of long-term infrastructure assets.
Highways
Indias roads and highways sector continues to present significant growth opportunities, supported by the Governments sustained focus on expanding and modernizing the national highway network. During FY 2025-26, the National Highways Authority of India (NHAI) advanced several strategic initiatives aimed at strengthening transportation infrastructure, improving connectivity and enabling the adoption of digital technologies across highway corridors.
Among these initiatives, NHAI has outlined plans to develop an extensive optic fibre network along national highways, laying the foundation for future digital highway infrastructure and enhanced connectivity. In parallel, the Cabinet Committee on Economic Affairs approved eight National High-Speed Corridor projects spanning approximately 936 km, with an estimated investment of 50,000 Crore, underscoring the Governments continued commitment to accelerating road infrastructure development.
Backed by increased capital allocation and a strong project pipeline, NHAI is expected to maintain a robust pace of project execution in FY 2026-27 and beyond. The sector outlook remains positive, supported by sustained investments in capacity augmentation, corridor development and technology-enabled infrastructure.
Your Companys current highways portfolio consists of two BOT (Annuity) and one BOT (Toll) projects with a total operating length of 888 lane kilometers. These include Ambala-Chandigarh Highway project, Chennai Outer Ring Road and Adloor - Gundla - Pochanpalli highway.
Urban Infrastructure
In earlier years, GPUILs subsidiary, GMR Krishnagiri SIR Limited (GKSIR) and other companies had partially developed 511 Acres and sold to Tata Electronics Private Limited wherein they established a mobile phone component manufacturing plant with an investment of - Rs. 14,000 Crore & employment of 20,000
people. Later, an extent of 110 Acres was also sold to Tata Electronics Products and Solutions Private Limited for iPhone Assembly plant. Also, about 1,110 Acres have also been sold to State Industries Promotion Corporation of Tamil Nadu ("SIPCOT") for Industrial Development in the Region.
During the financial year 2025-26 GKSIR has taken up the development of -61 Acres of land by creating infrastructure facilities for the purpose of leasing / sale to industrial clients.
Integrating ESG into Responsible Infrastructure Development
At GPUIL, Environmental, Social and Governance (ESG) considerations are embedded into the Companys strategy to deliver resilient, efficient and future-ready infrastructure. Across its diversified portfolio spanning power generation, highways, smart metering and urban infrastructure, GPUIL integrates sustainability into investment decisions, operational excellence and stakeholder engagement to create long-term value while supporting Indias evolving infrastructure and energy landscape.
Recognising the changing dynamics of the energy sector, GPUIL continues to advance its growth strategy, which seeks to transform the holistic business impact by integrating cleaner energy solutions, digital technologies and resource-efficient operations. The strategy focuses on improving the sustainability of existing assets while enabling the transition towards smarter energy systems through digital infrastructure, smart metering, energy efficiency and innovative utility solutions. Through this approach, GPUIL is supporting in improving energy accounting, reducing distribution losses, strengthening demand-side management and accelerating digitalisation of the power sector, while maintaining high standards of environmental stewardship and operational excellence.
The Companys ESG framework is supported by internationally recognized management systems, including ISO 14001 (Environmental Management), ISO 50001 (Energy Management), ISO 46001 (Water Efficiency Management), ISO 14064 (Greenhouse Gas Accounting), ISO/IEC 27701 (Privacy Information Management) and ISO 20400 aligned Sustainable Procurement practices. These systems enable consistent implementation of ESG principles across the Companys businesses while strengthening operational resilience, governance and stakeholder confidence.
Driving Resource Efficiency and Indias Energy Transition
Environmental stewardship remains integral to GPUILs operational philosophy. While supporting Indias energy transition, the Company continues to improve the sustainability performance of its existing assets through resource optimization, circular economy practices and deployment of cleaner technologies.
GPUIL continued to improve operational decarbonization by integrating rooftop solar installations at Kamalanga and Warora, supplying clean electricity for internal consumption. Across its thermal power operations, the Company continued implementing initiatives to improve energy efficiency in line with the Ministry of Powers Perform, Achieve and Trade (PAT) programme, reinforcing its long-standing commitment to energy conservation and operational excellence.
Circular economy principles continued to guide waste management practices across operations. The Company maintained 100% fly ash utilization, significantly reducing landfill dependencywhile supporting resource recovery. Fly ash transportation through rail continued to minimize value chain emissions, while the biomass pellet manufacturing facility at Warora converts horticulture waste into biomass fuel, creating an additional pathway for waste valorization. These initiatives complement externally assured Zero Waste to Landfill performance across the Companys thermal power operations.
Water stewardship remains another important area of focus. Through implementation of IS0 46001-certified Water Efficiency Management Systems, at Warora and Kamalanga, and continuous optimization initiatives, GPUIL maintained water consumption continues to be aligned to industry best practices. Additionally, GMR Kamalanga Energy Limited (GKEL) is a recipient of the Platinum Rating, the highest recognition under the Confederation of Indian Industrys Blue Rating Programme, across both Within the Fence and Beyond the Fence categories for water management. GMR Warora Energy Limited (GWEL) had received the Gold Rating, demonstrating the Companys sustained leadership in responsible water management extending beyond plant boundaries into neighbouring communities.
Environmental protection initiatives also extended to biodiversity conservation. Dense greenbelts covering over one-third of operational areas continue to enhance local biodiversity while improving environmental quality. During the year, Kamalanga completed its Wildlife Management Plan and initiated wildlife awareness programmes across schools in the surrounding region, further strengthening ecosystem conservation efforts.
Operational Excellence through Sustainable Infrastructure
GPUIL continues to demonstrate that operational excellence and sustainability are mutually reinforcing. The Companys integrated management systems, continuous improvement culture and focus on responsible operations received multiple national recognitions during FY 2026.
GKEL received the Excellence in Energy Efficiency Management Award, the highest category under the Confederation of Indian Industry (CII) Energy Excellence Awards, while GWEL received the Efficient Energy Management Award, reaffirming the Companys sustained leadership in energy-efficient operations. GKEL was also honored with the Environment Excellence Award 2025 for excellence in pollution prevention and environmental management.
The Companys approach to sustainability also extends across its highways and smart infrastructure businesses. Environmental, Health and Safety (EHS) management systems are being implemented across smart metering operations to ensure that emerging businesses are developed on the same strong sustainability foundation that characterizes GPUILs mature operating assets.
Building a Strong Safety Culture
GWEL is a recipient of 5-Star Rating under the National Safety Council Safety Rating System, reflecting the maturity of its occupational health and safety management systems. Both GWEL
and GKEL were honored with the prestigious Sarvashreshtha Suraksha Puraskar (Golden Trophy) and Safety Shield at the
National Safety Council of India (NSCI) Safety Awards 2025 in recognition of outstanding safety performance, leadership commitment and robust safety culture. GWEL was also recognized with the 5 Golden Safety Stars under the National Safety Rating System, reaffirming its position among Indias leading industrial organisations for occupational health and safety excellence.
Creating Shared Value for Communities
GPUIL continues to strengthen the socio-economic development of communities surrounding its operations through targeted interventions implemented by the GMR Varalakshmi Foundation. During FY 2026, the Companys CSR initiatives positively impacted approximately 2.25 lakh beneficiaries, with over 80% belonging to vulnerable and underserved communities. Programmes in education supported more than 22,000 students across Government schools and Anganwadis, while healthcare initiatives benefited nearly 2 lakh people through mobile medical units, evening medical clinics, health camps, sanitation programmes and access to safe drinking water. Livelihood initiatives supported around 2,500 beneficiaries through vocational training, farm and non-farm livelihood programmes, with a strong emphasis on women and youth empowerment.
The Company also expanded its skilling ecosystem through new vocational training centres and strategic partnerships with State Governments. Initiatives such as women-led livelihood programmes, youth skill development, employee volunteering and Daan Utsav further strengthened community engagement while contributing to inclusive and sustainable development.
Strengthening Governance and Responsible Business Practices
The Company continues to strengthen governance through active Board oversight, enterprise risk management, internal assurance mechanisms and a robust ethical culture. Sustainability considerations are integrated into strategic decision-making, operational risk management and business planning, ensuring long-term resilience across businesses.
During FY 2026, GPUIL further strengthened responsible supply chain management with 100% of suppliers committing to the GMR Supplier Code of Conduct and Business Ethics. The Company continued conducting ESG capacity-building programmes for suppliers while maintaining alignment with ISO 20400 Sustainable Procurement practices through recertification of its Central Procurement function. Independent third-party assurance of BRSR Core disclosures, regular internal audits, ethics training under the Code of Business Conduct & Ethics and structured risk management processes further enhanced transparency, accountability and stakeholder confidence.
Way Forward
As India accelerates investments in cleaner energy, digital utilities and resilient infrastructure, GPUIL remains committed to advancing its growth strategy in line with the sector requirements, while continuously improving the sustainability performance of its existing businesses. Going forward, the Company will continue to strengthen resource efficiency, expand digital energy solutions,
enhance circular economy practices, maintain industry-leading safety standards and embed ESG considerations across power, highways, smart metering and urban infrastructure businesses. Through these efforts, GPUIL seeks to create long-term stakeholder value while contributing meaningfully to Indias sustainable infrastructure and energy transition.
Discussion and analysis of financial conditions and operational performance
The consolidated financial position as at March 31, 2026 and performance of the Company and its subsidiaries, joint ventures and associates during the financial year ended on that date are discussed hereunder:
1. ASSETS-NON-CURRENT ASSETS
1.1. Property Plant and Equipment (PPE)
PPE has decreased from Rs. 7,124.94 Crore as at March 31,
2025 to Rs. 6,671.41 Crore as at March 31, 2026 primarily due to depreciation charged during the year, offset by capitalisation of CWIP to PPE in the normal course of business during the current year.
1.2. Right of use asset (ROU)
Right of use asset has increased from Rs. 275.46 Crore as at March 31, 2025 to Rs. 346.26 Crore as at March 31, 2026 primarily on account of additions in ROU asset due to new lease agreement entered during the current year offset by amortisation during the year.
1.3. Capitalwork-in-progress
Capital work-in-progress decreased from Rs. 505.26 Crore as at March 31, 2025 to Rs. 453.64 Crore as at March 31, 2026, primarily on account of capitalisation of assets to property, plant and equipment (PPE) during the current year.
1.4. Investment Property
Investment property has decreased from Rs. 165.02 Crore as at March 31, 2025 to Rs. 155.94 Crore as at March 31,
2026 primarily on account of sale of land parcels during the current year.
1.5. Goodwill
There is no change in the value of Goodwill amounting to Rs. 36.93 Crore.
1.6. Other Intangible Assets
Other Intangible assets have decreased from Rs. 564.34 Crore as at March 31, 2025 to Rs. 460.50 Crore as at March 31, 2026, mainly due to amortisation during the current year.
1.7. Investments accounted for using equity method
Investments accounted for using the equity method increased from Rs. 4.00 Crore as at March 31, 2025 to Rs. 254.10 Crore as at March 31, 2026. The increase is primarily on account of recognition of fair value of investments in GREL and GMR Vemagiri Generation Private Limited (GVPGL) (formerly GMR Vemagiri Generation Limited), consequent to change in control in these entities during the year. Refer note 35 of the audited consolidated financial statements.
Additionally, the increase includes Rs. 121.30 Crore representing the Groups share of profit/(loss) from Associates and Joint Ventures during the current year.
1.8. Other Investments
Other investments increased from Rs. 113.64 Crore as at March 31, 2025 to Rs. 350.85 Crore as at March 31, 2026, pursuant to recognition of other instruments in GREL and GVPGL. Refer note 8 of the audited consolidated financial statements.
1.9. Non-current trade receivables
Non-current trade receivables have decreased from Rs. 31.99 Crore as at March 31, 2025 to Rs. 0.41 Crore as at March 31, 2026 due to reclassification of trade receivables from noncurrent to current.
1.10. Loans
Loans have decreased from Rs. 66.86 Crore as at March 31,
2025 to Rs. 53.53 Crore as at March 31, 2026 due to repayment of loans during the year offset by increase on account of new loans extended during the current period.
1.11. Other financial assets
Other financial assets have increased from Rs. 803.06 Crore as at March 31, 2025 to Rs. 1,679.98 Crore as at March 31,
2026 mainly due to recognition of receivable against service concession arrangements ("SCA") in GASML, GKSML and GTSML (Smart Meter SPVs) pursuant to start of billing during the current year and also increase in noncurrent bank balances in the normal course of business.
1.12. Other non-current assets
Other non-current assets have decreased from Rs. 51.07 Crore as at March 31, 2025 to Rs. 50.84 Crore as at March 31, 2026 in normal course of business.
1.13. Income tax assets (net)
Income tax assets have increased from Rs. 22.87 Crore as at March 31, 2025 toRs. 92.52 Crore as at March 31 2026 mainly due to tax deducted at source during the current year.
2. ASSETS - CURRENT ASSETS
2.1. Inventories
Inventories have increased from Rs. 394.84 Crore as at March 31, 2025 to Rs. 499.11 Crore as at March 31, 2026 in in normal course of business.
2.2. Investments
Investments have increased from Rs. 247.37 Crore as at March 31, 2025 to Rs. 585.32 Crore as at March 31, 2026 primarily on account of investment in mutual fund during the year.
2.3. Trade receivables
Trade receivables have decreased from Rs. 1,704.94 Crore as at March 31, 2025 to Rs. 1,179.89 Crore as at March 31, 2026, primarily due to receipt of claims in GKEL. Refer note 44 ofthe audited consolidated financial statements.
2.4. Cash and cash equivalents
Cash and Cash equivalents have decreased from Rs. 688.67 Crore as at March 31, 2025 to Rs. 560.47 Crore as at March 31, 2026 mainly on account of utilization of the borrowings taken by the group companies and regular cash outflows in normal course of business.
2.5. Bank balances other than cash and cash equivalents
Bank balances other than cash and cash equivalents increased from Rs. 297.68 Crore as at March 31, 2025 to Rs. 613.91 Crore as at March 31, 2026 mainly due to additional funds being placed in fixed deposits.
2.6 Loans
Loans have increased from Rs. 25.63 Crore as at March 31,
2025 to Rs. 147.73 Crore as at March 31, 2026 mainly due to the new loans extended to related parties during the current year.
2.7. Other financial assets
Other financial assets have decreased from Rs. 2,215.35 Crore as at March 31, 2025 to Rs. 1,858.78 Crore as at March 31,
2026 primarily due to reduction in unbilled revenue in GKEL offset by recognition of receivable against service concession arrangements ("SCA") of smart meter SPVs pursuant to start of billing during the current year
2.8. Other current assets
Other current assets have increased from Rs. 694.24 Crore as at March 31, 2025 to Rs. 746.11 Crore as at March 31, 2026 primarily due to increase in deposits/balance with government authorities during the current year offset by decrease in advances to suppliers in normal course of business.
2.9. Assets included in disposal group held for sale
Assets included in disposal group held for sale as decreased from Rs. 948.74 Crore as at March 31, 2025 to Rs. 246.93 Crore as at March 31, 2026 primarily due to sale of CCDs and equity instruments held in Bajoli Holi Hydro Power Limited (BHHPL) (formerly GMR Bajoli Holi Hydro Power Limited) (GBHHPL) and sale of stake in GVPGL. Refer note 35 of the audited consolidated financial statements.
3. EQUITY
Increase in equity share capital from Rs. 357.42 Crore as at March 31, 2025 to Rs. 390.51 Crore as at March 31, 2026, mainly due to shares issued under preferential allotment basis during the current year.
Other equity has increased from Rs. 229.49 Crore as at March 31, 2025 to Rs. 1,513.32 Crore as at March 31,2026 primarily on account of increase in securities premium, money received against share warrants and profit for the current year ended March 31, 2026.
Loss of non-controlling interest have increased from Rs. 130.82 Crore as at March 31, 2025 to Rs. 204.80 Crore as at March 31, 2026 mainly due to share of profit of minority and acquisition of non-controlling interests during the year ended March 31, 2026.
4. NON-CURRENT LIABILITIES
4.1. Borrowings
Non-current borrowings have increased from Rs. 8,770.47 Crore as at March 31,2025 to Rs. 9,656.59 Crore as at March 31, 2026 mainly due to new borrowings availed by the Group Companies during the current year offset by the repayment of the borrowings in respect of NCDs through acquisition of NCD by the Group Companies and repayment of loan from banks and financial institutions, as well as the reclassification of certain borrowings as current borrowings in accordance with their repayment terms.
4.2. Lease Liabilities
Lease liabilities have increased from Rs. 17.16 Crore as at March 31, 2025 to Rs. 81.25 Crore as at March 31,2026 mainly on account of new lease agreements entered during the current year.
4.3 Other Financial Liabilities
Other financial liabilities have decreased from Rs. 956.04 Crore as at March 31, 2025 to Rs. 459.99 Crore as at March 31, 2026, mainly due to reversal/extinguishment of derivative liability on account of repayment of underlying borrowings in respect of NCDs through acquisition of NCD by the Group Companies offset by increase in interest payable on account of interest payable on borrowings.
4.4. Provisions
Provisions have decreased from Rs. 135.92 Crore as at March 31, 2025 to Rs. 84.17 Crore as at March 31, 2026 mainly due to decrease in provision for operation and maintenance in highway entities.
4.5. Other non-current Liabilities
Other non-current liabilities have decreased from Rs. 20.52 Crore as at March 31, 2025 to Rs. 13.50 Crore as at March 31, 2026 on account of decrease in deferred/unearned revenue.
4.6. Deferred Tax Liabilities
Deferred tax liabilities have increased from Rs. 75.37 Crore as at March 31,2025 to Rs. 254.88 Crore as at March 31, 2026 mainly due to recognition of deferred tax liability during the year ended March 31, 2026.
5. CURRENT LIABILITIES
5.1. Borrowings
Borrowings have increased from Rs. 1,467.83 Crore as at March 31, 2025 to Rs. 1,846.65 Crore as at March 31, 2026 mainly due to reclassification of borrowings from noncurrent to current in accordance with their repayment terms.
5.2. Trade Payables
Trade payables have increased from Rs. 1,154.96 Crore as at March 31, 2025 to Rs. 1,288.03 Crore as at March 31, 2026 in normal course of business.
5.3. Lease Liabilities
Lease liabilities have increased from Rs. 3.82 Crore as at March 31, 2025 to Rs. 9.09 Crore as at March 31, 2026 mainly on account of new lease agreements entered during the current year.
5.4. Other current financial liabilities
Other current financial liabilities decreased from Rs. 1,846.65 Crore as at March 31, 2025 to Rs. 492.35 Crore as at March 31, 2026, mainly due to reversal of liability towards capital goods, payable to SEPCO by GKEL. Also, decrease is on account of reduction in interest payable due to repayment of interest on borrowings and repayment of interest payable to NCD holders through acquisition of NCDs by the Group Companies.
5.5. Other current liabilities
Other current liabilities have decreased from Rs. 1,088.86 Crore as at March 31, 2025 to Rs. 515.28 Crore as at March
31, 2026 mainly due to reversal of other liabilities payable to SEPCO by GKEL.
5.6. Provisions
Provisions have decreased from Rs. 420.20 Crore as at March 31, 2025 to Rs. 179.69 Crore as at March 31, 2026 mainly due to reversal of provision for loss in associate pursuant to One-time Settlement ("OTS") with the consortium of lenders of GMR Rajahmundry Energy Limited ("GREL") along with the decrease in other provision on account of reversal/write back.
5.6. Liabilities included in disposal group held for sale
Liabilities included in disposal group held for sale decreased from Rs. 255.14 Crore as at March 31, 2025 to Rs. 23.63 Crore as at March 31, 2026 mainly due to sale of stake in GVPGL. Refer note 35 of the audited consolidated financial statements.
Overview of our results of operations
The following table sets forth information with respect to the revenues, expenditure, and profit/(loss) on a consolidated basis
(Rs. in Crore)
| Particulars | March 31, 2026 | March 31, 2025 |
| Continuing operations | ||
| Income | ||
| Revenue from operations (including other operating income) | 7331.86 | 6343.97 |
| Other income | 416.32 | 513.85 |
| Total Income | 7,748.18 | 6,857.82 |
| Expenses | ||
| Revenue share paid / payable to concessionaire grantors | - | 56.57 |
| Consumption of fuel | 2,367.82 | 2,519.23 |
| Cost of material consumed | 1,219.25 | 297.13 |
| Purchase of traded goods | 847.45 | 660.14 |
| Transmission and distribution charges | 29.12 | 11.82 |
| Sub-contracting expenses | 151.73 | 160.92 |
| Employee benefits expense | 282.59 | 251.89 |
| Other expenses | 829.64 | 719.17 |
| Total expenses | 5,727.60 | 4,676.87 |
| Earnings before finance cost, tax, depreciation and amortization expenses (EBIDTA) and exceptional items | 2,020.58 | 2,180.95 |
| Depreciation and amortization expenses | 665.80 | 599.85 |
| Finance costs | 1,658.67 | 1,571.01 |
| (Loss)/profit before share of profit/ (loss) of investments as per accounting under equity method, exceptional items and tax from continuing operations | (303.89) | 10.09 |
| Share of profit/ (loss) of investments as per accounting under equity method | 121.30 | (133.53) |
| Loss before exceptional items and tax from continuing operations | (182.59) | (123.44) |
| Exceptional items | 963.76 | 1,899.72 |
| Profit before tax from continuing operations | 781.17 | 1,776.28 |
| Tax expenses | 194.55 | 38.38 |
| Profit after tax from continuing operations (i) | 586.62 | 1,737.90 |
| (Rs. in Crore) | ||
| Particulars | March 31, 2026 | March 31, 2025 |
| Discontinued operations | ||
| Profit/(loss) from discontinued operations before tax expenses | 27.07 | (185.65) |
| Tax expenses | - | - |
| Profit/(loss) after tax from discontinued operations (ii) | 27.07 | (185.65) |
| Total profit after tax for the year (A) = (i+ii) | 613.69 | 1,552.25 |
| Other comprehensive loss for the year, net of tax (B) | (15.36) | (73.68) |
| Total comprehensive income for the year, net of tax (A+B) | 598.33 | 1,478.57 |
Sales/Operating Revenue
The segment wise break-up of the Sales/Operating Revenue are as follows: (Rs. in Crore)
| Particulars | For the year ended | |
| March 31, 2026 | March 31, 2025 | |
| Revenue from Operations: | ||
| Power | 5,406.99 | 5,330.85 |
| Smart Meter Infrastructure | 1,417.78 | 320.54 |
| Road | 218.37 | 396.69 |
| EPC | 91.92 | 190.75 |
| Others | 386.55 | 315.23 |
| Inter segment and inter operations | (189.75) | (210.09) |
| Total Revenue from operations | 7,331.86 | 6,343.97 |
Operating revenue from power segment
Revenue from the power segment consists of generation and sale of electrical energy from GMR Warora Energy Limited ("GWEL"), GMR Kamalanga Energy Limited ("GKEL") and GMR Gujarat Solar Power Limited ("GGSPL"). Also, it includes energy and coal trading revenue from GMR Energy Trading Limited ("GETL") and GMR Infrastructure (Singapore) Pte. Limited ("GISPL") respectively.
There is an increase of 1.43% in the operating revenue from power segment from Rs. 5,330.85 Crore in FY 2024-25 to Rs. 5,406.99 Crore in FY 2025-26. This was mainly because both the thermal plants GKEL and GWEL operated at similar PLF levels as previous year. In addition, the power segment benefited from a higher contribution from the coal trading business, driven by increased market demand and higher trading volumes during the year
Operating revenue from smart meter infrastructure segment
Revenue from smart meter infrastructure segment mainly consists of revenue on account of smart meters installation & control and maintenance. The revenue has been recognised in accordance with Ind AS 115, as the meters are operational and the performance obligations have been satisfied.
During the current year, the revenue is recognised for the full year, wherein revenue recognition had commenced since December 2024 in the previous year when all the performance obligations were met.
Operating revenue from road segment
Revenue from the road operations is derived from annuity payments received from NHAI for our annuity projects and toll charges collected from road users ofthe toll road projects.
The operating revenue from road segment has decreased by 44.95% from Rs. 396.69 Crore in FY 2024-25 to Rs. 218.37 Crore in FY 2025-26 mainly due to closure of operation in GHVEPL on account of handover of project pursuant to amicable settlement between GHVEPL and NHAI effective from July 01, 2024.
Operating revenue from EPC segment
Revenue from the EPC segment is derived from the execution of engineering, procurement and construction works in connection with railways and roads.
EPC sector operating revenue is Rs. 91.92 Crore in FY 2025-26 and Rs. 190.75 Crore in FY 2024-25. DFCC project is completed and track is hand over to DFCCIL for operations. However, certain ancillary works are pending completion, which company is in process of completion.
Operating revenue from Other Sectors
Revenue from other sector includes management services revenue, investment revenue and operating revenue of aviation businesses. During the FY 2025-26, other sector has contributed Rs. 386.55 Crore to the Operating Revenue as against Rs. 315.23 Crore in FY 2024-25.
Expenditure
Revenue share paid/payable to concessionaire grantors
The revenue share paid/payable to various concessionaires has decreased from Rs. 56.57 Crore in FY 2024-25 to Rs. Nil in FY 202526 primarily on account of handover of GHVEPL project to NHAI on account of amicable settlement between GHVEPL and NHAI effective from July 01, 2024.
Operating and administrative expenditure Sub-Contractina expenses
The decrease in sub contracting expenses is mainly on account decrease in corresponding revenue in ongoing DFCC project as DFCC project is completed and track is handed over to DFCCIL for operations. However, certain ancillary works are pending completion, which company is in process of completion
Consumption of fuel
The decrease in fuel consumption is primarily attributable to lower coal prices during the current year.
Purchase of Traded goods
The increase in purchase of traded goods is mainly on account ofincrease in corresponding revenue in coal trading.
Cost of material consumed
The increase in cost of materials consumed is primarily attributable to smart meters, as the related costs for smart meters installations are recognised for the full year, wherein the costs recognition had commenced since December 2024 in the previous year
Employee benefits expenses
The increase in employee benefit costs in the current year is mainly on account of increase in head count due to increased operations, annual increments and project/variable payouts during the current year.
Other expenses
Other expenses include:
• Consumption of stores and spares, electricity and water charges, manpower hire charges, rentals, repairs and maintenance, legal and professional charges, provision for
doubtful advances, logo fees, fair valuation on financial instruments through P&L, write off/provision towards investments, travelling and conveyance, communication, foreign exchange differences and other miscellaneous expenses.
There is increase in other expenses in FY 2025-26 mainly due to increase in consumption of stores & spare expenses, airport service charges, logo fees, repair and maintenance expenses, rent expense due to increase in operations.
Finance Cost
The finance costs have increased from Rs. 1,571.01 Crore in FY 2024-25 to Rs. 1,658.67 Crore in FY 2025-26 mainly due to new borrowings availed during the current year.
Exceptional items
Exceptional items comprise the reversal of payable to capital creditor and other liabilities, impairment (net) of loan and investment in joint venture and associates, impairment/ reversal of receivables from various customers and profit/(loss) on sale of investment and investment property.
Share of profit / (loss) of investments as per accounting under equity method
Increase in share of profit of Joint Ventures and Associates mainly due to accounting of share of profit on the fair valuation gain on plant as recorded by GMR Rajahmundry Energy Limited (GREL).
Tax Expenses
Tax expenses mainly comprise current tax and deferred tax. The increase in tax expenses in FY 2025-26, as compared to FY 202425, is primarily attributable to the recognition of deferred tax liability during the current year.
Significant changes in key financial ratios, along with detailed explanations
In compliance with the requirement of listing regulations, details of significant changes (i.e. Change of 25% or more as compared to the immediately previous financial year) in key financial ratios and any changes in return on net worth ofthe company (on standalone basis) including explanations therefore are given below:
| Particulars | Numerator | Denominator | March 31, 2026 | March 31, 2025 | Variance | Reasons for variance |
| Interest Coverage Ratio | Earnings before interest, taxes, depreciation and amortisation | Interest Expenses | 0.67 | 1.05 | (35.95%) | Due to increase in finance cost during the FY 2025-26 |
| Operating Profit Margin | Earnings before interest, taxes, depreciation and amortisation | Revenue | 63.56% | 63.75% | (0.30%) | Not applicable |
| Return on Net Worth | Net Profit / (loss) | Equity (excluding fare valuation through other comprehensive income) | (1.13%) | 5.70% | (119.84%) | Due to loss incurred during the FY 2025-26 |
Also refer note 40 of the standalone financial statements for key financial ratios including reason for variances (other than above), on standalone basis.
Corporate Social Responsibility
GMR Varalakshmi Foundation ("GMRVF") is the Corporate Social Responsibility arm of the GMR Group. The Group has been undertaking CSR activities on a significant scale since 1991. GMRVF supports the companies under the Group in implementing their CSR mandates. GMRVFs purpose is to work in the fields of Education, Health and Empowerment such that its activities directly benefit mainly the communities in the immediate neighborhood of the Groups projects. Currently, GMRVF is working with selected communities in about 20 locations in India. The locations are spread across different states namely Himachal Pradesh, Odisha, Maharashtra, Punjab, Tamil Nadu, Telangana and Uttar Pradesh.
During the FY 2025-26, GMRVF implemented the CSR activities in the areas of Education, Health and Livelihoods in all its project areas.
Significant achievements of GMRVF in the year FY 2025-26 are as below:
• Precision Farming Project implemented at Warora stood as runner-up at Group level CIP competition in Promising Innovation category.
• 647 women & farmers supported for vegetable and wheat cultivation at Warora
• About 300 farmers supported at Kamalanga for fish farming, paddy, groundnut and potato cultivation etc.
• Initiated temporary Skill Training Center (Kasi Viswanath Kaushal Vikas Kendra) at Varanasi with 6 courses including the E-Auto training course in partnership with Mahindra
• 25 Individual Sanitary Lavatories (ISLs) supported by GMRVF were inaugurated at Majra Rai village, Warora. Over the past 7 years, GMRVF has facilitated the construction of 1,024 ISLs in Warora
• Installed a new Water ATM at Borda, Warora to provide clean, safe, and affordable drinking water to about 1000 community members
• Repaired 6 check dams and farm ponds bringing 145+ acres under irrigation, improving groundwater levels, benefiting 5,000+ villagers at Warora
• AI model developed for detection of wrong side driving with IIIT-H support and successfully piloted at Toopran
Risk, Concerns and Threats: Identification, assessment, profiling, treatment and monitoring
The Company has developed the Enterprise Risk Management framework across all its businesses and key assets.
The revised framework takes into account best practices in Enterprise Risk Management focusing on the followings:
• Strengthening linkage between Corporate Strategy and Risk Management functions to help the Company focus on key strategic risks.
• Integrating detailed risk assessment into the Companys annual exercise of Strategy-setting and Annual Operating Plan vis-a-vis its tracking and monitoring through the defined governance structure.
• Integrating the existing Business Continuity Plan (BCP) and Disaster Recovery Plan (DRP) with ERM framework to enable business operations to swiftly adapt to disruption while maintaining continuous business operations and safeguarding people, assets and overall brand equity.
• Strengthening the commitment to sustainability and demonstrable efforts to reduce, eradicate or mitigate the impact of its operations on the environment and community have also become more comprehensive. The Companys ESG program is rooted in materiality that has helped it organise and prioritise relevant ESG factors.
Reporting: The leadership of all the businesses of the GMR Group regularly review their risk assessment and mitigation procedures and present to their respective Boards/ Committees. Further, a consolidated perspective is presented to the Risk Management Committee of the Company. Based on the above process, the Management has taken cognisance of risks in the recent times for which appropriate plans are being made and actions being taken.
During the year, the Company has prioritised the several risks that it regards as significant for its business operations and strategies. These risks have been described hereunder along with existing and proposed mitigation measures:
> Arbitration/ litigation risks
GPUIL continues to have arbitration claims over counterparties across its energy and transportation businesses:
• We have ongoing arbitration with DFCCIL on the two railway freight corridor projects over unresolved claims for compensation for change-in-law, and prolongation claim arising from the Black Swan event of prolonged pandemic lockdown.
For addressing these risks:
• GPUIL relies on its robust in-house mechanism for dispute risk assessment, which provides the management with an early evaluation of the risks and costs associated with every potential arbitration/ litigation.
• The Company would typically work with a combination of strong in-house counsel - both corporate and sectoral, and specialist external counsel as per the specific requirements.
• Prolongation claim to DFCCIL against pandemic lockdown has been initiated under the provisions of the contract and its resolution is expected to be reached in due course.
Some of the litigations and disputes were resolved during the year:
• Long-standing litigation with SEPCO was resolved in favor of GPUIL by the Supreme Court in September 2025.
• GKEL recovered Rs. 1,138 Crore in regulatory dues from Haryana DISCOMs in September 2025
• The settlement agreement between GPEL (SPV for Pochanpalli highway) and NHAI was finalized in Q4 FY 26 and the settlement was reached at Rs. 40.82 Crore. The asset is due for handback to NHAI in September 2026 after a mandatory major maintenance for 56 lane kilometer is completed.
• Our Ambala-Chandigarh highway asset has been granted one-year extension for compensating the revenue loss.
> Financial risks
• Liquidity risks
• GPUIL, being substantially a holding company with limited operating cash flows, has been constrained to service or refinance the corporate debt / outstanding loans.
• Additionally, at the subsidiary level, there remains a liquidity risk to meet obligations including debt servicing/ repayment.
• Outstanding regulatory cycle for receivables from DISCOMs may worsen to over 5 months from last years 2to3 months.
• Any adverse outcome of ongoing litigations may have impact on ability to repay debt.
• Liquidity requirements for Smart Meters projects, setting up renewables at our existing thermal assets and airports, other new business initiatives will need to be arranged.
There have been positive developments during the year that have mitigated some risks and the Company is monitoring other developments:
• Sale/ divestment - Divestment of stressed nonoperational assets are now largely closed, reducing Group debt by ~ Rs. 4,400 Crore. Further payments expected in the current year.
• Regulatory receivables — significant recovery GWEL and GKEL have realised substantial long-pending regulatory receivables from DISCOMs;recovery continues.
• GKEL refinancing & covenant changes to enable cash upstreaming to GPUIL completed.
• The Companys Board of Directors has approved preferential issuance of equity shares and convertible warrants in December 2025.
• Interest rate risk
• Residual inflation pressure keeping rates elevated, though the macro backdrop has eased — RBI has cut the repo rate over the last 12 months.
• Interest rate on debt remains the key exposure.
• Existing debt across assets still contributes, though several tranches now refinanced at lower cost.
Some developments that have helped in mitigating the interest rate risks are:
• All corporate loans are taken at fixed rate, thus any increase in interest rate will not materially impact us.
• Inflation moderated during FY 26, RBI cut repo rates by 75 bps during last FY 26.
• Over the past few years, divestment of assets, loan from GAL, KIA FCCB conversion and waiver of interest, settlement with NHAI for HV, etc. - all improved overall credit worthiness of GPUIL.
• Refinancing of debt at GKEL during FY 26 has led to reduction in interest costs due to improvement in credit rating.
• Existing project entities are focused on improving operating cash flows and improve their ratings to access cheaper debt.
• Credit risk
• Sale of electricity to DISCOMs still carries credit risk, though sector receivables have improved sharply.
• DISCOMs are now relatively regular on operational dues;regulatory dues still largely delayed via litigation.
• Smart Meter receivables has signitificantly increased which poses credit risk for GPUIL.
Mitigation of credit risk:
• All receivables closely monitored and reviewed frequently by top management
• The Late Payment Surcharge (LPS) Rules of 2022 has significantly brought down the legacy DISCOM dues to 3,300 Crore. in Mar 26 from ~ Rs. 1.39 Lakh Crore. in Jun 22. Dues to generators is now down -96% since the 2022 LPS Rule.
• The direct debit facility in PMPM (per meter per month) fee mechanism allows the Company to ensure timely collection of dues.
• The Company also pursues advocacy with the government agencies through industry platforms for expediting resolution of any issues in collection.
> Regulatory risks
• The Energy sector remains under ESG scrutiny, and upholding climate targets is still a factor in accessing cheaper capital for coal-based projects. Despite this challenge, the regulatory environment for thermal power has eased materially over FY 26.
• The exemption is credit-positive for the sector — reducing sector-wide capex and easing tariff pressure.
• Slow pace of resolution at regulatory forums may still delay outcomes on some unresolved matters.
> FGD related risk
• MoEFCC notification dated 11 July 2025 substantially revised the FGD framework: Category C plants (outside sensitive zones) are exempt from mandatory FGD installation;CategoryA are required to comply by Dec 2027;Category B is assessed case-by-case.
This removes a major capex and cash-flow overhang from GPUILs energy business.
As mitigation, the company actively takes several measures as described below:
• Tracking of all developments in the regulatory environment.
• Making representations through industry associations to safeguard business interests from political intervention.
• Identifying, monitoring and updating management on regulatory developments and their impact.
• Where necessary, engaging in arbitration and/or litigation to protect the Groups interest.
• The Company works closely with all relevant stakeholders to mitigate the impact of policy changes arising from changes in State Governments.
• Under the revised FGD norms, GWEL is in Category C (exempt);GKEL secured an Environmental Clearance amendment in May 2026 formalizing its exemption — removing the earlier FGD capex and tariff overhang.
> Operational risks
• Thermal power plants - Any downside deviation to project PLFs will impact cashflows;PLFs may be affected by unscheduled maintenance, linkage coal supply, or lower power demand.
• Smart meter installation - delays attract liquidated damages.
• Lower traffic on Ambala-Chandigarh traffic declined 13.3% YoY in Q4 FY 26.
Over the year, some positive developments have taken place, which mitigate some of the operational risks, as described below:
• Plant PLFs (Plant Load Factor) remain strong on healthy power demand and better coal availability.
• Planned maintenance and regular maintenance capex is improving the reliability of the plants thereby reducing the risk of lower PLF & efficiency.
• Smart Meters, ~42 lakh meters installed by July 2026.
• We have received an extension for the installations. Hence there is no risk of liquidated damages.
• Since Ambala-Chandigarh highway operation has been extended for another one year, we will be compensated for the shortfall in traffic.
> Technology risks
GPUIL is exposed to risks from rapidly changing
technology both on the operational and policy/ regulatory
fronts, some ofwhich are:
• Our thermal/ conventional generation assets are exposed to risks from rapid shift in energy mix — solar & BESS (Battery Energy Storage System), wind, green hydrogen, etc.
• Generation technology and storage technology are fast evolving. For instance, battery technology is moving from conventional lithium-ion to sodium-ion. This exposes the new storage business to early standards lock-in, leading to risk of premature obsolescence.
• Legacy metering, SCADA and billing platforms in urban/distribution assets may soon become incompatible with smart-grid and IoT standards.
Some of the mitigation measures for addressing technology-related risks are as follows:
• We plan to expand further into renewables, storage and hybrid PPAs;scenario-based capex gating and asset-repurposing.
• We are continuously exploring the evolving generation and storage technologies with local and global players.
• GPUIL also partners with leading technology companies for technology partnership in its projects. Bosch joined as technological partners in implementing UP smart meter project.
? Reputation/ brand risks
GPUILs businesses do not have noteworthy exposure to
reputation and brand risks. However, reputation may have
some impact due to the followings:
• The energy businesses may be lagging behind in meeting ESG expectations.
• Risk of certain assets defaulting on debt obligations.
• Negative litigation outcomes.
• Smart meter installation is consumer facing business which requires interaction with residents and can pose a brand reputation risk due to potential customer resistance to adoption.
Taking cognizance of increasing pressure on power generation industry to meet ESG expectations, GPUIL has taken proactive action in diversifying its energy portfolio and is taking measures to ensure full compliance with any new regulations that existing businesses may be subjected to.
• To mitigate risks to reputation in broader public perception, GPUIL takes proactive steps to ensure it communicates through PR and Investor teams.
• The Companys policies are continuously being updated to assess, check and enhance brand value with respect to:
o Operational excellence.
o Strong governance (including ethics standards),
o Strong Sustainability credentials,
o CSR.
• The Company is making continuing efforts to meet its debt obligations, improve liquidity and credit profile of GPUIL.
• The Company continues to work proactively with stakeholders for protecting brand name.
• Outsourced manpower installing smart meters are provided training on softer aspects to deal with consumers.
> Cybersecurity Risks
There has been no noticeable breach of cyber security in the Companys network. However, due to evolving threats, vulnerability to increasingly sophisticated hacking methods, the Companys businesses may be affected in different ways as below:
• Data loss.
• Malware/ Cyber-threat.
• Impersonation.
• Given the nature of operations at GPUILs assets the Company is not exposed to any severe cybersecurity risk.
• Smart Meters business, being highly digital in nature, may be exposed to cyberattacks.
As the energy and road assets do not have any operations that heavily depend on informationsharing or live online transactions, they generally face minimal risk of disruption from online threats. However, the Company has taken several measures which are described below:
• GPUIL is part of the group-wide centralized cyber security program in place, covering people, process and technologies aspects of Cyber Protect, Detect, Respond & Recover capabilities.
• 24 x 7 Next Generation Security Operations Centre monitoring all critical infrastructure for any suspicious activity.
• AI/ML based End Point Detection implemented across all computing devices.
• Next Gen Web Application Firewall protecting all public facing websites.
• Periodic Vulnerability assessments and Penetration testing are conducted of the environment along with continuous attacksurface monitoring.
• Periodic User awareness communications and trainings are conducted.
• Periodic program maturity assessment is conducted to drive continuous improvement plan.
• For UP smart meter project, BOSCH was appointed as technology partner.
> Political Risks
The Smart Meters projects in several states are facing consumer dissatisfaction as described below:
• Prepaid Smart Meters have become a live political issue in 2026, with protests across UP, Bihar, Goa, Maharashtra, Karnataka and J&K over over-billing and disconnections.
• UP ordered ~85 lakh prepaid meters converted to postpaid after protests and regulatory intervention, altering the prepaid revenue/collections model on which AMI service providers projects were bid — though contractor payments have continued.
GPUIL is strategically handling the political risk mitigation through various measures such as:
• Contractual protection: The Company actively pursue contractual protection against uncertainties emerging from change-in-law and change-in-scope, etc.
• Payment-security hardening: The Company engages with stakeholders and regulatory bodies for robust mechanism to insulate cash flows from politically driven payment delays.
• Stakeholder & government engagement: GPUIL maintains structured engagement with the Ministry of Power, UPPCL/ DISCOMs and industry forums (CII/ FICCI) to shape stable AMISP contract norms, with early-warning monitoring of state election calendars and tariff-populism signals.
> Competition Risks
Our company may be exposed to strategic risks due to
highly competitive environment in the sectors that we
have operating assets in as well as new businesses that
we plan to enter in. These risks are described below:
• Competition in renewable energy projects: Due to large amount of capital chasing the renewable energy opportunities in India, the competition for our entry in this segment is high.
• Competition for highways/ railways/ EPC contracts: Intense competition on highways and railways projects with players having low cost of capital.
• Aggressive competition from big strategic competitors and financial players in areas such as Smart Metering/ Transportation projects.
• In both energy and transportation sectors, we have to compete with other players having access to low cost of capital resulting in highly competitive bids, thus impacting our growth plans.
The Companys rich experience provides with the options and opportunities to mitigate risks well which are described below:
• The company has robust mechanism for bid screening and selection which helps it to select profitable bids only.
• We have predefined thresholds for commercial appetite when selecting the opportunities. If the economics of the bid are below the thresholds, we do not proceed with the bid.
• Our overall competencies and rich experience in transportation and energy sectors has enabled us to maintain our competitive position in both sectors.
• We are constantly reviewing our business strategy based on assessment of growth prospective in the sectors that the company operates in.
• Long term PPAs for thermal power are in demand, amid rising RTC power requirement from the states.
• We are working towards improving cashflows at Holdco through various initiatives - asset monetization, debt restructuring/ improving Credit rating of our assets to lower the cost of debt; refinancing;upstreaming of cash from assets to Holdco. These initiatives will help us reduce our cost of capital and hence make us more competitive.
> Climate Risks
• Changing weather patterns are leading to more probability of extreme weather events such as:
• Rainfall, floods, landslides.
• Drought conditions.
• Earthquakes.
Since, the Company has hydro and road projects in its portfolio, these are exposed to such weather events.
The Company relies on vast experience from its businesses and internal processes to mitigate climate risks.
• The Business Continuity Plans continue to focus on:
• Operational continuity of the energy assets.
• Financial sustainability - cash conservation and reduction of cost structure.
• Organizational resilience.
• The Company maintains adequate insurance to cover for such contingencies.
> Business Environment risks
The business environment exposes GPUIL to various risks
such as:
• Regulatory and tariff uncertainty in the power and urban infrastructure sectors can compress margins, as evolving CERC/SERC orders and appellate disputes affect the timing and quantum of cost recovery.
• Commodity and fuel price volatility, particularly in coal, solar panel, battery, construction inputs, etc., can materially raise operating and project costs and squeeze profitability across generation and EPC activities.
• Macroeconomic and interest-rate cycles, including elevated borrowing costs and inflation, can increase the cost of capital for capital-intensive infrastructure assets and strain debt-servicing capacity.
• Intensifying competition and aggressive bidding in smart meters, renewables and infrastructure projects can erode returns and lead to the acquisition of projects/ assets at unsustainable price points.
• Geopolitical tensions and supply-chain disruptions can delay equipment delivery, inflate landed costs, and jeopardize the timely commissioning of critical projects.
To mitigate business environment risks, GPUIL takes various measures as follows:
• For addressing the regulatory and tariff related risks, our Company actively engages with regulators, while diversifying its portfolio across regulated and merchant segments to reduce dependence on any single tariff outcome.
• The Company manages its capital structure prudently by refinancing at favorable rates, extending debt maturities, and using instruments to lower and diversify its overall funding cost.
• The Company applies disciplined investment criteria with clearly defined return thresholds and walks away from over-priced bids, focusing instead on markets and asset classes where it holds an operational or strategic advantage.
• The Company is progressively rebalancing its portfolio towards renewables and cleaner urban infrastructure, and it embeds ESG targets into its long-term capital allocation and stakeholder reporting.
• The Company diversifies its supplier base across geographies, maintains buffer inventories for critical components, and builds contractual protections and contingency schedules into its EPC and procurement arrangements.
> Talent risks
• For Companys new businesses in the energy sector, a pool of trained manpower specializing in new technologies and large-scale project management may not be readily available.
• Availability of skilled manpower for Smart Metering and renewables pipeline may be impacted due to the intensifying competition.
• Competition for IoT / data-analytics and OT- cybersecurity skills also poses risk.
The Company is taking several measures to mitigate talent risks:
• Building a dedicated pool of manpower with specialized technical and project-management skills; structured hiring, training academies and lateral induction for smart-metering, renewables and O&M roles.
• Blended resourcing through outsourcing / consulting and strategic partnerships (e.g. BGSW-Bosch for metering system architecture) to meet critical, time- bound resource requirements.
• Shift from agency model to staffing model continues to lift productivity which is evident from increase in daily installation from 5000 units to 7000 units.
• Technical staff are also provided continuous training and skilling to mitigate the talent risk.
Internal control systems and their adequacy
The Companys internal financial control framework has been established in accordance with COSO framework to ensure adequacy of design and operating effectiveness of operational, financial and compliance related controls. The design and operating effectiveness of the internal controls are regularly reviewed by Management Assurance Group ("MAG") (Internal Auditors of the Company) during audits.
The Company has put adequate policies and procedures in place, which play a pivotal role in implementation and monitoring of internal controls, which are embedded in various business processes, including IT & SAP. MAG assesses opportunities for improvement in business processes, policies, systems and controls and provides their recommendations to strengthen Companys internal control environment.
Respective Business/Company CEOs are responsible for ensuring compliance with laid down policies and procedures. It helps the Company to accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control and governance processes.
MAG is responsible for undertaking internal audits across the group and they are assisted by outsourced audit firms. The internal audit scope covers, inter alia, all businesses and corporate functions, as per the annual audit plan reviewed and approved by the Audit Committee in the beginning of every financial year.
Audit issues identified are addressed through systemic implementation of appropriate corrective and preventive action by the respective functions. Emphasis is always placed on automation of controls within the processes to minimise deviations and exceptions.
MAG presents in quarterly Audit Committee Meeting, key audit issues along with action taken report on pending audit issues. Head MAG provides an assurance to the Audit Committee confirming compliance to prescribed processes while carrying out audits, reporting audit observations, monitoring and implementation ofthe agreed action plan for closure.
Developments in Human Resources and Organisation Development at GPUIL
HR continued to play a critical role in supporting business growth through large-scale workforce mobilization, leadership hiring, capability building, succession planning, and employee engagement. These initiatives strengthened organizational readiness, enhanced leadership bench strength, improved workforce capability, and positioned the GPUIL to deliver its growth and transformation agenda.
> Power / Energy Sector
1. Talent Acquisition & Workforce Expansion Strategic Workforce Mobilization
• Successfully onboarded 9,732 outsourced workforce personnel through staffing partners, compared to an average deployment of 3,998 employees in January 2026.
• Average deployment included 3,999 Technicians, 3,974 Helpers, 194 DEOs, and 194 SDAs.
• Achieved the highest-ever deployment of contractual manpower through staffing agencies, ensuring timely execution of Smart Metering projects.
Leadership & Critical Talent Hiring
• Onboarded 156 employees across businesses and functions;Key leadership positions filled
Learning & Development
Key capability-building initiatives included:
• Campus-to-Corporate Program for 35 GETs.
• High-Performance Culture Initiative for Smart Metering.
• Launch of Dakshata, a capability-building program across employee levels.
• Team-building and collaboration workshops for Regulatory & Contracts, Legal and Corporate Affairs teams.
• Business Simulation & Strategy Workshops for Smart Metering leadership.
Learning Impact
• 183 learning programs conducted;1,792 participant workdays delivered;13,976 learning hours completed.
• 84% employee training coverage.
2. Leadership Pipeline & Succession Planning
• Strengthened leadership readiness and succession plans for critical positions across businesses.
3. Employee Engagement & Well-being
Recognition & Rewards
• Recognized 184 employees, covering 20% ofthe workforce and reinforcing a culture of appreciation and performance excellence.
Employee Engagement
• Conducted 75 engagement and wellness initiatives across locations
Employee Well-being
• Continued the Positive Intelligence Programme to promote mental fitness and emotional well-being.
• Conducted 5 well-being interventions covering 110+ people managers, focusing on selfawareness, resilience, and team wellness.
> Common HR initiatives across GPUIL (Power & Urban Infra)
For the Sector, we conducted Values, Beliefs and Culture Induction for new joiners covering almost 300+ employees for GPUIL in the last 6 months, through both online and inperson interventions to institutionalize GMRs Values & Beliefs framework.
Engaged 70+ employees in the last 6 months through inner excellence sessions across Delhi, Warora, nurturing emotional fitness of employees.
As a Values, Beliefs and Culture initiative, 60+ employees participated in our digital campaigns.
Impact:
• Strengthened alignment with GMRs Values & Beliefs framework.
• Enhanced employee wellbeing and emotional resilience.
• Increased employee engagement and participation across businesses.
Established a Unified HR Data Foundation
Implemented a Group-wide Master Data Transformation programme, consolidating employee records from multiple legacy systems into a single, authoritative HR platform. The initiative standardized employee data across existing, newly formed, and acquired entities, creating a single source of truth for enterprise-wide workforce management and analytics.
Modernized Payroll and Employee Self-Service Experience
Successfully transitioned payroll, leave, attendance, tax, and employee self-service processes to a modern digital platform integrated with the core HR ecosystem. Delivered through a structured change management programme, the transformation ensured seamless payroll continuity, anytime- anywhere-any device accessibility, enhanced employee experience, and strengthened compliance readiness across the Group.
Capability Development
• Developed a Functional Competency Dictionary and mapped technical and behavioral competencies across roles to support competency-based talent development.
• Successfully onboarded and developed 64 early-career professionals comprising 9 Management Trainees, 3 Graduate Finance Trainees/CA-MTs, 2 Group Management Trainees, and 50 Graduate Engineering Trainees.
• The programme focuses on developing future-ready talent through comprehensive learning journeys, business exposure, and leadership readiness interventions.
• Rolled out GLIDE (GMR Leadership Identification & Development Excellence), GMRs flagship leadership assessment and development initiative, covering 286 leaders across leadership levels.
• Conducted Development Centres for 93 leaders using a comprehensive assessment framework.
• Designed Individual Development Plans (IDPs) for participating leaders to enable focused leadership development and succession readiness, with implementation in progress.
Employee Value Proposition, Rewards & Compliance
(across sectors)
• Implemented Labour code across entities to ensure compliance with new labour laws
• Enhanced Group Medical coverage and support to junior employees with premium and corporate buffer.
• Introduced medical insurance policy forsuperannuated employees.
• Conducted benchmarking, updated job architecture and pay ranges in line with benchmarking.
• Revised PLIP policy with updated business metric to align with improving margins and investors expectations.
• Launched insurance scheme for retired employee on self-funded basis
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IIFL Capital Services Limited - Stock Broker SEBI Regn. No: INZ000164132 (Member ID - NSE: 10975 BSE: 179 MCX: 55995 NCDEX: 01249), DP SEBI Reg. No. IN-DP-185-2016, IA SEBI Regn. No: INA000000623, Merchant Banker SEBI Regn. No. INM000010940, RA SEBI Regn. No: INH000000248, BSE Enlistment Number (RA): 5016, AMFI-Registered Mutual Fund Distributor & SIF Distributor
ARN NO : 47791 (Date of initial registration – 17/02/2007; Current validity of ARN – 08/02/2027), PFRDA Reg. No. PoP 20092018, IRDAI Corporate Agent (Composite) : CA1099
This Certificate Demonstrates That IIFL As An Organization Has Defined And Put In Place Best-Practice Information Security Processes.
