Ceigall India Limited, one of the country’s fastest-growing EPC and infrastructure development companies, has taken a major stride in expanding its power transmission footprint with the announcement of a new Letter of Intent (LOI) awarded by REC Power Development and Consultancy Limited (RECPDCL). The LOI pertains to the establishment of a state-of-the-art 400/220 kV Gas Insulated Substation (GIS) in Velgaon, Maharashtra, marking a significant milestone in the organisation’s journey toward diversifying beyond traditional highway and bridge construction into more sustainable, asset-backed infrastructure segments.

The announcement, made on 25 November 2025, reflects a strong endorsement from REC Power Development, a key implementing agency in India’s power transmission and distribution sector. The Velgaon substation, to be developed under the Tariff-Based Competitive Bidding (TBCB) mechanism, marks Ceigall’s entry into a highly specialised vertical of the power infrastructure industry, regarded for both its technical complexity and long-term value creation potential.

A Strategic Move Into Power Transmission

The awarded project involves the construction of a 400/220 kV GIS substation, a modern and compact power infrastructure system that ensures high reliability, reduced footprint, and enhanced safety. GIS substations are becoming increasingly preferred in urban and industrial clusters due to their high efficiency, minimal maintenance requirements, and superior environmental performance.

For Ceigall, traditionally known for its large and complex EPC projects across highways, expressways, elevated corridors, and major bridge structures, this move represents a deliberate strategic push toward areas that generate long-term, recurring revenue in addition to EPC payments. The project is structured with a two-year construction timeline, followed by a 35-year operation and maintenance (O&M) commitment, ensuring revenue visibility for nearly four decades.

According to information disclosed by the company, the project will generate an annual annuity of ₹58.5 crore for 35 years, supported by a total EPC cost of approximately ₹450 crore. This revenue model ensures stable cash flows and strengthens the company’s financial resilience, particularly in periods of EPC market volatility.

Expanding into Sustainable, Asset-Backed Infrastructure

The long-term O&M structure of the Velgaon GIS project provides Ceigall an avenue to evolve from being purely a contract-based EPC organisation to becoming a hybrid model player—one that builds, operates, and maintains crucial infrastructure. This transformation has been underway for several years, supported by the company’s expanding portfolio of Hybrid Annuity Model (HAM) projects in the road sector.

With this new venture into power transmission, Ceigall is positioning itself as a sustainable infrastructure company, capable of participating in India’s journey of strengthening its national grid, enhancing transmission reliability, and preparing for future growth driven by industrial development and green energy integration.

This diversification aligns with broader national policy trends. India is rapidly upgrading its transmission infrastructure to accommodate shifting demand patterns, renewable energy integration, and urban expansion. Demand for GIS-based substations is rising sharply, particularly in regions with land constraints or dense habitation—factors that make the Velgaon project a strategically located asset.

Leadership Speaks: Commitment to Precision and Quality

Commenting on the LOI, Mr. Ramneek Sehgal, Chairman & Managing Director of Ceigall India Ltd., expressed enthusiasm and confidence in the company’s ability to execute the large-scale, technologically advanced project. He noted:

“We are honoured to be entrusted with the Velgaon GIS project by REC Power. This demonstrates Ceigall’s engineering strengths and our commitment to delivering large-scale, future-ready infrastructure. As India rapidly upgrades its power transmission backbone, Ceigall remains focused on building assets that enhance grid reliability and meet the highest benchmarks of safety and performance. The Velgaon substation will be a crucial addition to the regional power network, and we look forward to executing it with precision and excellence.”

This endorsement by RECPDCL further validates Ceigall’s growing reputation for managing complex projects with adherence to quality, time, and performance standards. The company’s expanding expertise across engineering design, procurement, and large-scale project execution creates a strong foundation for success in the power sector.

Strengthening FY25–26 Order Book

The Velgaon substation project joins a series of major project wins secured by Ceigall in FY25–26. The company continues to be active in national highway upgrades, mobility corridors, high-capacity bridges, railway overbridges, and essential urban infrastructure works. These projects demonstrate Ceigall’s core technical competence, diversified sector participation, and growing trust from central and state implementing agencies.

Analysts tracking infrastructure growth in India note that Ceigall’s move into the power sector not only diversifies but also stabilises its order book. Substation projects typically operate on longer cycles and include multiyear revenue streams from O&M activities, contributing to a more balanced annual performance.

A Transformative Milestone for Ceigall

With India prioritising sustainable infrastructure, grid modernisation, and efficient energy distribution, companies capable of delivering complex transmission assets are set to play a pivotal role. Ceigall’s entry into this domain with a major GIS substation project signals its readiness to operate in high-value engineering environments.

The Velgaon project combines technical sophistication, long-term revenue generation, national relevance, and strong institutional support, making it one of the most strategic additions to Ceigall’s ongoing and future project portfolio.

As the company moves forward with construction, the Velgaon substation is poised to become a critical node in Maharashtra’s power network, enhancing grid stability for years to come and solidifying Ceigall’s position as an emerging leader in comprehensive infrastructure development.

Join our Telegram Channel for Latest News and Regular Updates.

Start your Mutual Fund Journey  by Opening Free Account in Asset Plus.

Start your Stock Market Journey and Apply in IPO by Opening Free Demat Account in Choice Broking FinX.