SEPC loses ₹230 cr order as MOIL cancels contract
The government undertaking has scrapped the vertical shaft project, forcing SEPC to forfeit its earnest money deposit.
What's new
- MOIL cancelled the contract for a vertical shaft design and build project.
- SEPC lost a ₹50 lakh earnest money deposit due to the cancellation.
- Work had not yet commenced on the project.
Why it matters
The loss removes a major revenue pillar for a company already in default and fighting for liquidity. With a credit rating of 'D', SEPC lacks the financial cushion to absorb both the loss of project value and the direct cash outflow from the forfeited deposit.
What we're watching
- Updates on the company's legal proceedings and ongoing debt restructuring efforts.
- Potential further credit rating actions from agencies following this setback.
- Management guidance on pipeline visibility for the remainder of FY25.
The full read
SEPC’s thin pipeline just got thinner. MOIL Limited has pulled a ₹230 crore vertical shaft order awarded to the company only last December. The cancellation is a major blow, stripping away a project worth roughly 16% of SEPC's current ₹1,445 crore market capitalization. Execution had not yet begun, but the impact is immediate: SEPC must forfeit its ₹50 lakh earnest money deposit. For a firm already burdened by credit defaults, a 'D' rating, and active legal battles, this loss is more than just a missed revenue opportunity. It removes a key source of cash flow for a company under extreme liquidity distress. With investor confidence already low, the cancellation makes the path toward financial stability significantly steeper. The company is now left to face its debt obligations with one fewer lever to pull.