India: Godawari eying 3 mnt pellet output in FY26 following capacity ramp up

• Trial pellet production expected from Oct’25
• Iron ore output increases 9% y-o-y

Godawari Power and Ispat Limited (GPIL), central India’s leading steelmaker, recently announced its first quarter financial year 2026 (Q1FY’26) results. Project construction of 2 mnt pellet plant is going on as per schedule and the major equipment have been received at site and installation work is in process. The company expects to start trial production from October 2025.

Quarterly performance highlights:

• Iron ore production in Q1FY’26 stood at 642,243 tonnes (t), an increase of 9% y-o-y as compared to 590,488 t in Q1FY’25.
• The company’s pellet production stood at 673,750 t in the quarter under review, up by 3% y-o-y compared to 651,700 t of production volume in Q1FY’25.
• Total pellet sales in Q1FY’26 stood at 466,575 t, a rise of 6% y-o-y as compared to 442,102 t in the year-ago period.
• Steel billet output for the quarter stood at 103,470 t, a y-o-y decrease of 9% compared to 113,480 t in Q1FY’25.

Performance highlights:

Financial 

• EBIDTA falls y-o-y: The company’s standalone EBITDA was recorded at INR 298 crore (cr) in Q1FY’26, a y-o-y fall of 24% as against INR 391 cr in the same period last year.
• PAT drops y-o-y: GPIL’s profit after tax (PAT) fell by 27% y-o-y to INR 201 cr in Q1FY’26 from INR 275 cr in Q1FY’25.

Sales and production guidance:

• FY’26 pellet output guidance up:The company increased its production guidance for pellet to 3 mnt for FY’26 from 2.45 mnt in FY’25 indicating a strategic push toward higher capacity utilization and operational scale-up. This revised guidance is well supported by a strong start to the year, with 20–25% of the full-year target already achieved in Q1, along with improved raw material availability following the resumption of Boria Tibu mine operations.
• Average pellet sales realisation drops: GPIL’s average sales realisation stood at INR 9,828/t in Q1FY’26, a decrease of 6% y-o-y from INR 10,503/t in Q1FY’25 amid softness in market prices across key product categories, particularly galvanized products.
• Battery energy storage project (10 GWh): A new greenfield project under the subsidiary Godavari New Energy Pvt. Ltd, aimed at manufacturing battery packs and containers. This aligns with clean energy and decarbonisation goals.

Upcoming capacities, projects

• Cold rolling mill complex: GPIL’s board has approved a capex of INR 900 crore for setting up a 0.7 million tonnes per annum (Mntpa) Cold Rolling Mill (CRM) complex. This facility will enable the company to convert HRC into Cold Rolled Coil and manufacture high-margin, value-added products such as color-coated steel, and zinc-aluminium-magnesium coated steel.
• Battery energy storage system: Under its subsidiary Godavari New Energy Private Ltd, GPIL plans to set up a 10 GWh Battery Energy Storage System (BESS) project with an investment of INR 700 crore. The facility will manufacture battery packs and containers, with part of the raw materials to be supplied by GPIL’s upcoming CRM complex. The project will aims to leverage incentives under the Package Scheme of Incentives 2019 from the Government of Maharashtra.
• Resumption of Boria tibu mine operations: The company resumed operations at its Boria tibu iron ore mine following the approval of the revised mining plan by the Indian Bureau of Mines (IBM). This resumption is expected to further enhance the availability of captive raw material and support the increased pellet production and cost-efficiency targets set for FY’26.
• Approval to supply billets for transmission projects: GPIL has received approval from PGCIL (Power Grid Corporation of India Ltd.) to supply steel billets to manufacturers of galvanized steel structures used in transmission projects. This approval opens up new market opportunities and reflects the quality of GPIL’s products. It also complements the company’s integrated steel production capabilities and supports volume and margin expansion.