JSW Energy Limited has informed the Exchange about Update on material litigation under Regulation 30(4) of the Securities Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015
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JSW Energy informed the exchange that the Supreme Court has ruled in favour of the Government of Himachal Pradesh in a case involving its step-down subsidiary, JSW Hydro Energy Limited (JSWHEL). The Supreme Court set aside a May 2024 Himachal Pradesh High Court judgement that had capped the free electricity supply to the state at 13% instead of 18%. The original Implementation Agreement required 18% free power to the home state. With the High Court ruling overturned, JSW Hydro Energy will now need to supply free electricity at the higher 18% level as per the original agreement.
This is an adverse ruling for JSW Energy and its subsidiary, as supplying more free power to Himachal Pradesh means lower revenue generation from the project. Investors should expect a negative impact on the earnings potential of JSW Hydro Energy and may see short-term pressure on the stock.