Reliance Power delivered impressive financial performance in the June 2026 quarter, with consolidated net profit surging 44% to ₹65 crore compared to ₹44.68 crore in the corresponding quarter of the previous year. According to reports from Business Standard, this significant profit growth demonstrates the company's operational efficiency and market positioning during the quarter, despite facing ongoing legal and financial challenges at some of its subsidiaries.
The company's sales revenue increased 4% to ₹1,956 crore in Q1 FY2026, up from ₹1,885.58 crore in the same period last year. As reported by Business Standard, the revenue growth indicates steady business operations and market demand for the company's services during the quarter. However, the company disclosed significant legal challenges, with the Central Bureau of Investigation (CBI) conducting search and seizure operations at registered offices of Reliance Power and Reliance Cleangen Ltd during the quarter, in connection with transactions involving Reliance Commercial Finance Ltd and Reliance Home Finance Ltd. The company stated it had fully cooperated with the investigation and that the searches had no impact on the group's business operations.
Operating profit margin (OPM) stood at 28.75% in the June 2026 quarter, compared to 29.97% in the corresponding quarter of the previous year. According to the financial data reported by Business Standard, this margin compression reflects the company's focus on volume growth over margin expansion during the quarter. The company also disclosed continuing financial stress at two subsidiaries - Rajasthan Sun Technique Energy Pvt Ltd (RSTEPL) has defaulted on lender repayments after technology deployment failed to deliver expected results, while compensation remains stayed by the Supreme Court. Additionally, lender action against Samalkot Power Ltd (SMPL) has resulted in corporate insolvency proceedings after invocation of a corporate guarantee.
During the quarter, ₹34.32 crore outstanding warrants lapsed after not being converted into equity within the prescribed 18-month period, resulting in the company forfeiting ₹302.62 crore received as upfront subscription amount. The company also disclosed that certain group companies and officials continue to be under investigation by the Enforcement Directorate (ED) under the Prevention of Money Laundering Act. While the ED has attached certain group assets, the company is contesting the action through legal proceedings and does not expect any impact on operations or financial statements at this stage. The auditors have flagged material uncertainty relating to the group's ability to continue as a going concern due to the financial position of these subsidiaries.
Despite material uncertainties, Reliance Power remains confident of meeting its liabilities through normal business operations and time-bound asset monetisation. The company stated that its core power generation business continues to operate normally, and it expects to continue as a going concern through planned asset monetisation at SMPL, subject to lender approvals. Shares of Reliance Power closed 0.29% higher at ₹24.25 on the BSE on Thursday, reflecting investor confidence in the company's operational performance despite the legal challenges.
