Prabha Energy Limited (**PEL**) is an Indian exploration and production (**E&P**) company specializing in the development of conventional and unconventional hydrocarbon assets. The company is a strategic player in the **Coal Bed Methane (CBM)** and **Marginal Gas Field** sectors, positioning itself as a key contributor to India’s goal of increasing domestic gas production to **5.0 MMSCMD** by **2027-28**. Following a **Composite Scheme of Arrangement** effective **September 22, 2024**, PEL completed a reverse merger with **Deep Energy Resources Limited** and **Savla Oil and Gas Private Limited**, subsequently listing on the **BSE** and **NSE** on **March 19, 2025**. --- ### **Asset Portfolio & Resource Inventory** As of **December 31, 2025**, PEL manages a diversified portfolio of **11 assets** (including relinquished blocks) covering approximately **5,370 sq km** with an estimated prognostic resource exceeding **460 MMBOE**. | Asset Category | Estimated Reserves/Resources | Key Locations | Operational Status | |:---|:---|:---|:---| | **CBM Gas Blocks** | **10 BCM** (Billion Cubic Meters) | Jharkhand (North Karanpura, Jharia) | Development & Early Production | | **Marginal Gas Fields** | **50,247 MMCF** (IGIP) | Jaisalmer, Rajasthan | Active Production | | **Oil & Gas (NELP)** | **310 MMboe** | Chhattisgarh, MP, Gujarat | Exploration Phase | --- ### **Core Operational Segments & Infrastructure** #### **1. Coal Bed Methane (CBM) – The Primary Growth Engine** * **North Karanpura Block:** PEL holds a **25% Participating Interest (PI)** and joint operatorship with **ONGC (55%)** and **IOCL (20%)**. Commercial production officially commenced on **May 16, 2025**. While full-scale evacuation via pipeline is being finalized, PEL has initiated "early monetization" by selling gas through **cascades** to generate immediate cash flow. * **Jharia CBM Block I:** PEL holds a **100% PI** (subject to a **10% revenue share** to BCCL). The company has secured **PNGRB** authorization for an **8-9 km pipeline** to connect the block to the **Urja Ganga** National Gas Grid. Commercial production is targeted for **Q4FY26**. * **Economic Model:** The company targets a robust **EBITDA margin of approximately 70%** over the lifecycle of its CBM blocks, utilizing a **staggered capex strategy** to fund later development phases through internal accruals. #### **2. Marginal Fields & Service Contracts** * **Rajasthan Operations:** PEL operates **3 fields** in Rajasthan under service contracts with **ONGC** (active since 2007). * **Infrastructure:** Facilities include a **Gas Collecting Station (GGS)** at Bankia equipped with specialized purification and drying units, supported by a **15 km** transport pipeline. #### **3. Conventional E&P (NELP)** * The company holds three blocks awarded under the New Exploration Licensing Policy (**NELP**) across Chhattisgarh (**789 sq km**), Gujarat (**534 sq km**), and Madhya Pradesh (**3,776 sq km**). These assets represent long-term exploration upside with a combined resource potential of **310 MMboe**. --- ### **Financial Performance & Capital Structure** #### **Revenue and Profitability Trends** The company is currently in a transitional phase, moving from heavy exploration expenditure to commercial realization. | Particulars (Consolidated) | FY 2024-25 (₹ Crore) | FY 2023-24 (₹ Crore) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | **Revenue from Operations** | **3.95** | **2.79** | **+41.71%** | | **Net Loss** | **(1.40)** | **(0.95)** | **-47.37%** | *Note: Costs for the North Karanpura block are currently **capitalized** under **Ind AS 106**. Depletion will commence once **proved and developed reserves** are fully established.* #### **Debt Management & The 2026 Rights Issue** In **March 2026**, PEL launched a major capital raise to deleverage its balance sheet and fund growth. * **Issue Details:** Raised **₹139.21 crore** via **96,67,258** shares at **₹144 per share**. * **Debt Reduction:** Approximately **₹125 crore** of the proceeds were earmarked to repay unsecured loans and accrued interest owed to **Deep Industries Limited** (a group company). * **MPS Compliance:** Promoters voluntarily **forwent their entitlements** in the Rights Issue to ensure the company meets **Minimum Public Shareholding (MPS)** requirements. --- ### **Strategic Corporate Developments** * **Divestment of Non-Core Assets:** In **December 2025**, PEL sold its **70% stake** (3,50,000 shares) in **Deep Natural Resources Limited** at a premium. This exit from the vehicle-hiring business allows management to focus exclusively on hydrocarbon synergies. * **Leadership Transition:** **Mr. Shanil Paras Savla** assumed the role of **Managing Director** on **January 1, 2026**, for a **3-year term**, succeeding Mr. Shail Manoj Savla. * **Decommissioning Obligations:** Reflecting its commitment to environmental standards, the company increased its provision for **Abandonment Costs** to **₹829.7 lakhs** in **FY 2025**, up from **₹231.74 lakhs** the previous year. --- ### **Risk Factors & Investment Considerations** #### **Operational & Infrastructure Risks** * **Gestation & Liquidity:** The E&P sector requires massive upfront **Capex**. Delays in connecting blocks to the **National Gas Grid** or technical challenges in **de-watering** CBM wells could impact the timing of cash flows. * **Resource Uncertainty:** Reserve estimates are based on geological simulations; actual recovery rates may vary from prognostic figures. #### **Market & Regulatory Risks** * **Commodity & Currency:** Revenue is sensitive to international gas prices and **INR/USD** fluctuations. As of March 2025, the company held unhedged foreign currency payables of **₹64.92 Lakhs**. * **Concentration Risk:** The company may rely on **2 to 3 large buyers** for the majority of its gas off-take. * **Legal & Governance:** * Promoter **Rupesh Kantilal Savla** has a pending appeal in the **Supreme Court** regarding a prior SEBI insider trading penalty. * The company’s **trademark and logo are currently unregistered**, posing a minor intellectual property risk. * Ongoing monitoring of **four new Central Labour Codes** (notified Nov 2025) is required to assess potential impacts on operational costs. ### **Future Outlook** Management anticipates a **"significant improvement"** in financial performance from **FY26** onwards. This growth is expected to be driven by the stabilization of production at the **North Karanpura** block, the commissioning of the **Jharia** pipeline, and the broader tailwinds of the **US$ 67 billion** strategic investment plan for the Indian gas sector.