Order Cancellation
SEPC Work Order Worth ₹230 Crore Cancelled by MOIL; ₹50 Lakh EMD Forfeited
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SEPC Limited informed exchanges that MOIL Limited has cancelled a previously awarded ₹230 crore turnkey work order related to vertical shaft construction. The cancellation also includes forfeiture of Earnest Money Deposit (EMD) worth ₹50 lakh.
PRICE-SENSITIVE TRIGGER
Event: MOIL Limited cancelled a previously awarded work order issued to SEPC Limited.
Type: Order Cancellation
Impact: Negative
Immediate Effect: The cancellation removes a ₹230 crore project from SEPC’s execution pipeline and results in forfeiture of ₹50 lakh EMD.
Key Metrics:
- Cancelled Order Value: ₹230 crore including taxes.
- EMD Forfeiture: ₹50 lakh.
- Awarding Entity: MOIL Limited (Government Undertaking).
- Project Type: Turnkey vertical shaft construction project.
- Nature of Contract: Designing, construction, furnishing and equipping of 3rd Vertical Shaft.
- Execution Status: No execution commenced.
- Execution Date: NIL.
- Entity Classification: Domestic.
Highlight Metric:
- SEPC lost a ₹230 crore government undertaking project after MOIL cancelled the work order before execution commencement.
What Happened ?
SEPC Limited informed stock exchanges that MOIL Limited cancelled a work order previously awarded to the company.
The order, originally disclosed on December 29, 2025, involved designing, construction, furnishing, and equipping of a 3rd Vertical Shaft on a turnkey basis.
The total order value stood at ₹230 crore including taxes.
The company stated that no execution had commenced on the project prior to cancellation.
Additionally, MOIL cancelled the order along with forfeiture of Earnest Money Deposit (EMD) amounting to ₹50 lakh.
The disclosure was made under Regulation 30 of SEBI (LODR) Regulations.
Key Details
Cancelled Project Scope:
- The cancelled contract involved:
- Designing
- Construction
- Furnishing
- Equipping of 3rd Vertical Shaft
- The project was awarded by:
- MOIL Limited
- A Government Undertaking
- The project was structured on:
- Turnkey basis
- No execution activities had commenced before cancellation.
Note:
- The cancellation occurred prior to operational execution, limiting direct execution-stage disruption.
Financial & Operational Implications:
- The cancelled order value stood at:
- ₹230 crore including taxes
- The company faces:
- Removal of future project revenue visibility
- Loss of order book value
- EMD forfeiture amount:
- ₹50 lakh
- Since execution had not started:
- Project-stage operational exposure remains limited
- No major execution cost write-off was indicated
- The cancellation may impact near-term order inflow sentiment.
Note:
- The primary financial impact currently disclosed relates to order book reduction and EMD forfeiture.
Investor Relevance:
- Order cancellations in EPC businesses may affect:
- Revenue pipeline visibility
- Market confidence
- Future execution outlook
- Government-linked mining and infrastructure contracts remain subject to:
- Administrative decisions
- Tender compliance
- Execution readiness
- Investors may monitor:
- Replacement order inflows
- Updated order book position
- Future guidance from management
Note:
- Further clarity on replacement projects or revised order pipeline could become important for investors.
Risk Analysis
Summary:
- The cancellation highlights execution pipeline uncertainty and dependence on large institutional contracts within the EPC business model.
Key Risks:
- Loss of a large project reduces future revenue visibility.
- EPC order book volatility may affect business outlook.
- Forfeiture of EMD creates direct financial loss.
- Delays in securing replacement orders could affect execution momentum.
- Dependence on government-linked contracts increases administrative risk exposure.
- Future order conversion and retention remain important operational variables.
Worst Case Scenario:
- If additional order cancellations or weak order inflows emerge, SEPC’s revenue pipeline and investor confidence may weaken materially.
Risk Level: High
Company Commentary
- SEPC confirmed that MOIL Limited cancelled the previously awarded work order.
- The company stated that no execution had commenced on the project.
- MOIL also forfeited Earnest Money Deposit worth ₹50 lakh.
- The disclosure was made under SEBI Regulation 30 compliance requirements.
Official Exchange Filing: SEPC Limited