Power Mech Projects Wins ₹970 Crore Vedanta Power Operations and Maintenance Contract
Power Mech Projects has secured a ₹970 crore operations and maintenance contract from Vedanta Power Limited for the company's 1,200 MW Sakti Thermal Plant in Chhattisgarh, adding another large long-duration power-sector order to its expanding project portfolio.
The contract covers end-to-end operations and maintenance of two 600 MW coal-based generating units at the Sakti Thermal Plant located at Singhitarai village in Sakti district.
The total contract consideration comprises:
₹890 crore of basic contract value
and:
₹80 crore provision for additional services.
The ₹970 crore value excludes goods and services tax.
Power Mech will execute the contract over:
60 months, or five years,
from the date of the letter of intent or order confirmation.
The latest win strengthens the Hyderabad-headquartered engineering company's core operations and maintenance business and provides recurring revenue visibility across several financial years.
Power Mech Secures ₹970 Crore Vedanta Power Order
Power Mech Projects disclosed the new contract on:
September 9, 2026.
The order has been awarded by:
Vedanta Power Limited
for its Sakti Thermal Plant in Chhattisgarh.
The company classified the contract as a:
domestic operations and maintenance order.
The project significantly expands Power Mech's engagement with large private-sector thermal-power operators.
Contract Covers 1,200 MW Thermal Power Plant
The Sakti facility has installed capacity of:
1,200 MW.
It consists of:
two 600 MW generating units.
Power Mech's mandate covers operations and maintenance across the plant on an end-to-end basis.
For a thermal-power facility of this scale, O&M responsibilities can involve a wide range of activities required to keep generating units operating safely, reliably and efficiently.
Sakti Thermal Plant Is Located in Chhattisgarh
The power station is located at:
Singhitarai village
in:
Sakti district, Chhattisgarh.
Chhattisgarh is one of India's major power-producing states due to its proximity to large coal reserves and established thermal-power infrastructure.
The location has supported the development of several large generating facilities supplying electricity to industrial and grid customers.
₹890 Crore Forms Basic Contract Value
Of the total ₹970 crore consideration:
₹890 crore
represents the basic contract value.
An additional:
₹80 crore
has been provided for additional services.
This structure gives Power Mech a substantial guaranteed core scope while allowing for supplementary work during the five-year contract period.
The total value is stated excluding GST.
Five-Year Tenure Provides Long Revenue Visibility
The contract will run for:
60 months.
Long-duration O&M contracts are strategically important because they create more predictable revenue streams than one-time construction projects.
Revenue can be recognised over several years as services are delivered.
That improves visibility for:
workforce planning,
cash-flow forecasting,
and resource allocation.
For investors, long-tenure service contracts can also reduce dependence on continually securing fresh short-cycle orders.
O&M Is a Core Power Mech Business
Power Mech Projects has built a major position in India's power-sector operations and maintenance industry.
Its capabilities cover areas such as:
power-plant operations,
preventive maintenance,
equipment maintenance,
shutdown services,
and performance management.
The company has worked across thermal-power assets owned by both:
public-sector
and:
private-sector operators.
O&M has become an important recurring component of its broader engineering portfolio.
Company Provides Integrated Power-Sector Services
Power Mech operates across multiple stages of power and infrastructure project development.
Its capabilities include:
erection,
testing and commissioning,
boilers,
turbines,
generators,
balance-of-plant works,
civil construction,
operations and maintenance,
and mining-related services.
This integrated capability allows it to participate in projects long after the original plant construction has been completed.
That can create repeated revenue opportunities throughout an asset's operating life.
Power Mech Has Previously Worked With Vedanta Group Companies
The latest contract deepens Power Mech's relationship with the wider Vedanta ecosystem.
The engineering company has previously secured large O&M assignments from Vedanta-linked power operations.
In 2024, Power Mech received an approximately:
₹865 crore
operations and maintenance order from Vedanta group company:
Talwandi Sabo Power Limited.
The latest Sakti contract demonstrates continued demand for Power Mech's thermal-power servicing capabilities from major private operators.
Repeat Orders Can Strengthen Customer Relationships
Large infrastructure O&M contracts depend heavily on execution track record.
Power producers generally require service providers with experience managing:
high-capacity equipment,
complex maintenance schedules,
safety requirements,
and workforce-intensive operations.
Winning repeated contracts from large industrial groups can therefore strengthen a contractor's credentials for future tenders.
It also indicates that large customers are willing to entrust long-duration operational responsibilities to the company.
Contract Is Not a Related-Party Transaction
Power Mech stated that its:
promoters,
promoter group,
and group companies
have no interest in Vedanta Power Limited.
The transaction therefore doesn't fall within the definition of a:
related-party transaction.
This disclosure forms part of the company's regulatory obligations for reporting significant orders to stock exchanges.
Power Mech Shares React Positively
Power Mech Projects shares moved higher following the announcement.
The stock climbed as much as approximately:
3.2% intraday
to around:
₹2,493.40
on the NSE.
It later gave up part of those gains as the broader equity market remained under pressure.
The positive initial reaction reflected investor focus on the size and five-year duration of the order.
Contract Adds to Strong Order Book
Power Mech entered FY27 with a substantial order backlog.
Its order book stood at approximately:
₹55,398 crore
following the first quarter of FY27.
The figure provides significant execution visibility across its various businesses.
The order book spans areas including:
civil infrastructure,
operations and maintenance,
mining,
power projects,
and other engineering services.
The Vedanta order adds another ₹970 crore of contracted work to that pipeline.
Order Book Is Multiple Times Annual Revenue
A large backlog relative to annual revenue is important for engineering and construction businesses.
It provides greater confidence regarding future:
project activity
and:
revenue generation.
However, order-book size alone doesn't determine profitability.
Actual performance depends on:
execution speed,
project mix,
cost control,
working capital,
and contract margins.
Power Mech's ability to convert its backlog into revenue efficiently will remain an important investor metric.
Q1 FY27 Revenue Rose More Than 25%
Power Mech reported strong top-line growth in the quarter ended:
June 30, 2026.
Consolidated net sales increased approximately:
25.5% year-on-year
to:
₹1,623.68 crore.
The growth reflected stronger execution across its project portfolio.
Civil infrastructure and O&M activities were among the contributors to the company's expanding revenue base.
Profit Performance Was More Mixed
While revenue increased strongly, profitability remained influenced by project costs and the timing of execution.
The company reported consolidated profit after minority interests of around:
₹80 crore
for Q1 FY27.
Management has continued to focus on maintaining:
execution discipline,
order inflows,
and margin performance
despite volatility in raw-material and operating costs.
Long-term service contracts such as the Vedanta order can potentially add greater stability to the revenue mix.
O&M Contracts Differ From EPC Projects
Engineering, procurement and construction contracts tend to generate revenue during the period in which an asset is being built.
O&M contracts begin after a plant enters operation.
They can continue for:
several years
or even:
decades through successive renewals.
This distinction gives O&M contractors access to recurring revenue from existing infrastructure even when new project construction slows.
The model can therefore complement cyclical EPC activity.
Thermal Plants Require Continuous Maintenance
Coal-based generating plants operate complex equipment under high temperatures and pressures.
Critical systems can include:
boilers,
steam turbines,
generators,
coal-handling systems,
ash systems,
water-treatment facilities,
and electrical infrastructure.
Regular maintenance is necessary to reduce:
equipment failures,
unplanned shutdowns,
and generation losses.
Operational reliability has direct commercial value because outages can reduce the electricity available for sale.
Plant Availability Is an Important Performance Metric
Power producers generally seek high:
plant availability.
A generating unit that remains unavailable due to maintenance problems cannot contribute fully to electricity generation.
Experienced O&M contractors therefore work to improve:
equipment reliability,
maintenance planning,
and outage management.
Even small improvements in operating availability can have substantial financial implications for a large 1,200 MW power station.
Preventive Maintenance Reduces Unexpected Failures
Modern O&M programmes increasingly emphasise:
preventive and predictive maintenance.
Instead of waiting for equipment to fail, operators monitor performance indicators and perform maintenance before problems become critical.
This can involve tracking:
temperature,
vibration,
pressure,
efficiency,
and equipment wear.
Data-driven maintenance can reduce unplanned shutdowns and extend the useful life of plant equipment.
Workforce Management Is Central to O&M Execution
Large thermal plants also require substantial skilled manpower.
O&M contractors may deploy:
engineers,
technicians,
operators,
supervisors,
safety specialists,
and maintenance personnel.
Managing workforce productivity is therefore one of the major economic variables in long-duration O&M contracts.
Power Mech's established manpower and engineering base gives it experience handling these complex deployments.
Safety Performance Is Critical
Power-plant operations involve substantial occupational risks.
Workers may be exposed to:
high-temperature systems,
electrical equipment,
heavy machinery,
coal-handling facilities,
and elevated structures.
Large industrial customers consequently place significant emphasis on:
safety systems,
training,
permit procedures,
and compliance.
Strong safety performance is essential for retaining long-duration O&M relationships.
India's Thermal Fleet Remains Large
The Vedanta contract comes despite India's rapid expansion of:
renewable energy.
Coal-based thermal power remains a major part of the country's electricity system.
Thermal plants continue to provide:
baseload generation,
grid stability,
and dispatchable power
when renewable output fluctuates.
This means existing coal plants will continue to require substantial operations and maintenance spending even as solar and wind capacity expands.
Rising Electricity Demand Supports Thermal Utilisation
India's electricity demand continues to grow due to:
industrialisation,
urbanisation,
higher household consumption,
data centres,
railway electrification,
and manufacturing expansion.
Renewables are expected to supply an increasing portion of incremental generation.
However, thermal power remains essential for meeting demand when solar or wind generation is unavailable.
Higher utilisation of existing thermal assets increases the importance of reliable plant maintenance.
O&M Spending Can Extend Asset Life
Power plants represent major capital investments.
Extending their useful operating lives can therefore create substantial economic value.
Effective maintenance can help preserve:
boiler performance,
turbine reliability,
generator efficiency,
and balance-of-plant systems.
Operators often prefer specialised contractors because the contractor can spread engineering expertise across multiple power plants.
This creates economies of experience.
Private Power Producers Increasingly Outsource O&M
Outsourcing O&M allows power producers to focus on areas such as:
fuel procurement,
power sales,
capital allocation,
and regulatory strategy.
Specialist contractors can manage day-to-day operations and maintenance under defined performance parameters.
The model can reduce the need for plant owners to maintain very large permanent technical teams.
For companies such as Power Mech, this creates a recurring addressable market.
Scale Can Improve Power Mech’s O&M Economics
As Power Mech manages more plants, it can potentially spread:
training,
technical expertise,
procurement,
and specialised engineering resources
across a larger contract base.
Scale can also strengthen its ability to mobilise teams rapidly for new projects.
This creates a competitive advantage when bidding for large contracts requiring extensive manpower and specialist capabilities.
Contract Provides Revenue Across Multiple Financial Years
Because the Vedanta contract runs for five years, its revenue contribution will extend across several reporting periods.
A simple division of the total value would imply an average contract value of roughly:
₹194 crore per year.
Actual revenue recognition may vary depending on:
work performed,
additional services,
contract milestones,
and accounting treatment.
The order therefore represents a meaningful recurring contribution rather than a one-quarter revenue event.
Additional Services Could Add Flexibility
The ₹80 crore provision for additional services gives the contract flexibility for work beyond the base scope.
Large thermal assets often require unexpected or supplementary maintenance over multi-year operating periods.
Having additional service provisions can reduce the need to negotiate separate contracts for every incremental requirement.
It may also create upside if those services are fully utilised.
Contract Strengthens FY27 Order Inflow
Power Mech has targeted significant new order inflows for FY27.
Management has previously indicated ambitions for annual order inflows around:
₹12,000 crore
as it expands across power, infrastructure and mining.
The Vedanta contract moves the company further toward that objective.
Large contract wins are particularly important because they increase future revenue visibility without requiring hundreds of smaller projects.
Power Mech Is Diversifying Beyond Traditional O&M
Although O&M remains a core business, Power Mech has increasingly diversified.
The company participates in:
civil infrastructure,
mining development and operations,
railways,
water projects,
industrial construction,
and renewable-energy-related work.
Diversification can reduce dependence on any single segment.
At the same time, power-sector expertise remains a major foundation of the company's business model.
Mining Development Is Becoming More Important
Power Mech has expanded into:
mine development and operations, or MDO.
Mining can provide another source of long-duration revenue because contracts may extend for many years.
Management expects MDO revenue to increase meaningfully as new projects ramp up.
The business therefore complements O&M by adding another recurring infrastructure-service revenue stream.
Civil Infrastructure Is Also Driving Growth
Civil infrastructure has become another important part of Power Mech's portfolio.
The company competes for projects involving:
roads,
railways,
buildings,
water systems,
and industrial facilities.
Growth in India's infrastructure investment has created opportunities for engineering companies with strong execution capabilities.
However, competition can be intense and margins vary considerably by project type.
Strong Order Pipeline Creates Execution Challenge
A very large order book also creates challenges.
Power Mech needs sufficient:
working capital,
employees,
equipment,
project managers,
and subcontractors
to execute multiple large projects simultaneously.
Rapid expansion without corresponding operating systems can pressure:
cash flows
and:
margins.
Management therefore needs to balance order acquisition with execution capacity.
Working Capital Remains Important for Engineering Companies
Engineering businesses frequently experience delays between spending money on:
labour,
materials,
equipment,
and subcontractors
and receiving payments from customers.
This creates working-capital requirements.
Long-term O&M contracts can provide more predictable monthly or periodic billing than some EPC projects.
That can make them strategically attractive when payment terms are well structured.
Vedanta Power Emerged From Group Demerger
Vedanta Power has become a separately listed business following the restructuring of the broader Vedanta group.
The company was among the businesses created through Vedanta's demerger, alongside entities focused on:
aluminium,
oil and gas,
and iron and steel.
Vedanta Power began trading independently in:
June 2026.
The restructuring is intended to give each business greater operational and capital-allocation focus.
Independent Power Business Can Focus on Plant Performance
As a standalone power company, Vedanta Power can concentrate more directly on:
generation efficiency,
plant availability,
fuel management,
capacity expansion,
and capital allocation.
Selecting specialist contractors for plant operations can form part of that strategy.
The Power Mech contract therefore comes during an important transition period for Vedanta's power assets.
Sakti Plant Requires Reliable Long-Term Operations
A 1,200 MW thermal station represents a substantial generating asset.
Reliable operation requires continuous coordination across:
equipment,
personnel,
fuel systems,
maintenance schedules,
and safety processes.
The five-year contract indicates that Vedanta Power is seeking a long-term service relationship rather than a limited maintenance assignment.
That increases both the responsibility and revenue opportunity for Power Mech.
Order Strengthens Power Mech’s Position in Private Power Sector
Power Mech works with both public and private power companies.
Large contracts from private operators such as Vedanta strengthen its position in a segment where customers often place strong emphasis on:
operating efficiency,
availability,
and cost discipline.
A successful five-year execution could also improve the company's credentials when competing for future outsourced O&M contracts.
Future Renewals Could Add Long-Term Upside
The current agreement covers five years.
Large power plants typically require O&M services throughout their operating lives.
If Power Mech performs successfully, there could eventually be opportunities for:
contract renewal
or:
additional scope.
No future extension has been announced, and any renewal would depend on performance and commercial negotiations.
Nevertheless, long-term customer relationships can create recurring opportunities beyond the original contract period.
Conclusion
Power Mech Projects has secured a ₹970 crore end-to-end operations and maintenance contract from Vedanta Power Limited for the 1,200 MW Sakti Thermal Plant in Chhattisgarh, strengthening its position in India's long-duration power O&M market.
The contract covers two 600 MW coal-based generating units and will run for 60 months from the date of the letter of intent or order confirmation. The total value comprises ₹890 crore of basic contract consideration and ₹80 crore reserved for additional services, excluding GST.
The order adds meaningful recurring revenue visibility to Power Mech's already substantial project pipeline. The company reported an order book of approximately ₹55,398 crore following Q1 FY27, while quarterly revenue increased more than 25% year-on-year to around ₹1,624 crore.
For Vedanta Power, the agreement secures specialist operating and maintenance capabilities for one of its major generation assets. For Power Mech, it deepens an existing relationship with the Vedanta ecosystem and reinforces O&M as a core recurring-revenue business.
With India's electricity demand continuing to rise and thermal generation remaining critical to grid reliability, large power stations will continue to require significant spending on operations, preventive maintenance, equipment reliability and plant availability.
The Vedanta order therefore provides Power Mech with not only another major contract win, but also five years of visibility from a 1,200 MW operating asset in one of India's most important power-producing states.