Diamond Power Infrastructure Limited completes PPE reconstruction

Diamond Power Infrastructure Limited has completed reconstruction and reconciliation of its property, plant and equipment records and adjusted a Rs 380.9256 crore pre-takeover depreciation shortfall against capital reserve for 1 April 2018 to 31 March 2022. Diamond Power said depreciation for the quarter and half year ended 30 September 2026 was calculated at fully regularised statutory rates.

What did Diamond Power complete in the PPE exercise?

Diamond Power completed physical verification, reconciliation and reconstruction of its property, plant and equipment, or PPE, records relating to periods before new management took control. The completed work covered updates to the PPE register, allocation of asset costs and accumulated depreciation, reconciliation with books of account, estimation of remaining useful lives and recalculation of depreciation from a 1 April 2018 baseline.

The exercise followed disruption to records in April 2018, when investigating-agency actions led to the seizure of substantial company records and digital data. Diamond Power said its operations then came to a standstill, insolvency proceedings under the Insolvency and Bankruptcy Code, 2016 began in August 2018, the National Company Law Tribunal sanctioned the resolution plan in June 2022, and commercial operations restarted in December 2022.

Diamond Power appointed an independent agency to verify assets and reconstruct the records. The company said the process took longer because of the substantial volume of PPE, ongoing activity across sections of its production plant and limited availability of older data. The agency’s report covers physical verification, cost allocation, accumulated depreciation and depreciation calculations both before and after implementation of the resolution plan.

The disclosure concerns the holding company, while the published September 2026 results are consolidated. The consolidated group includes DICABS Nextgen Special Alloys Private Limited and operates in cables and conductors, which Diamond Power reports as one operating segment under Indian Accounting Standard 108, or Ind AS 108.

Why did Diamond Power use a provisional depreciation rate?

Diamond Power used a flat depreciation rate of 20% of the applicable amount during the operational standstill and corporate insolvency resolution process because detailed PPE records were unavailable. The Resolution Professional applied that rate first, and management continued it after the June 2022 takeover as an interim estimate based on partial capacity utilisation and normal wear and tear.

The subsequent reconstruction replaced the flat-rate approach with useful-life assessments for individual asset blocks. Diamond Power said all blocks other than plant and machinery and electrical installations were assessed using useful lives based on original acquisition dates, in accordance with Schedule II of the Companies Act, 2013.

Plant and machinery and electrical installations received different post-takeover treatment. Diamond Power determined useful lives of 15 years for plant and machinery and 10 years for electrical installations, starting from the year of takeover by new management. It said this approach has applied from 1 April 2022.

The company stated that the independent agency recalculated depreciation before the resolution plan using old useful lives and after the plan using estimated balance useful lives. This distinguishes the reconstructed historic charges from the provisional 20% charge used while the register and supporting data were incomplete.

How did Diamond Power record the historical depreciation shortfall?

Diamond Power adjusted the Rs 380.9256 crore depreciation shortfall for the 1 April 2018 to 31 March 2022 pre-takeover transition period against capital reserve. The company said this was consistent with its policy of accounting for amounts relating to the period before takeover by new management through capital reserve.

That policy followed entries for write-offs, write-backs and other asset-and-liability adjustments arising from the approved resolution plan in FY 2022-23. Diamond Power stated that it had retrospectively regularised the depreciation shortfall under Indian Accounting Standard 8, or Ind AS 8, covering accounting policies, changes in accounting estimates and errors.

The filing also identifies a post-takeover resolution shortfall for 1 April 2022 to 31 March 2025 and says it was adjusted against retained earnings as of 1 April 2025. However, the amount shown in the supplied filing text for that adjustment is incomplete, so no figure is disclosed here.

Diamond Power said the current-quarter and half-year depreciation charge through 30 September 2026 was computed at fully regularised statutory rates. The company also stated that its PPE records and depreciation position now stand fully regularised, following the retrospective entries for the earlier periods.

What changed in Diamond Power’s September 2026 results?

Diamond Power’s consolidated depreciation expense was Rs 24.242 crore for the half year ended 30 September 2026, compared with Rs 14.6975 crore for the half year ended 30 September 2025. The increase of Rs 9.5445 crore coincided with the company’s statement that the current-period charge was calculated using fully regularised statutory rates.

Revenue from operations rose to Rs 1,721.7802 crore in the half year ended 30 September 2026 from Rs 740.1559 crore a year earlier. Consolidated net profit increased to Rs 166.3286 crore from Rs 40.4331 crore over the same periods, while profit before exceptional items and tax rose to Rs 167.331 crore from Rs 48.9399 crore.

Property, plant and equipment on the consolidated balance sheet was Rs 734.2426 crore at 30 September 2026, compared with Rs 1,194.0259 crore at 31 March 2026. Capital work-in-progress, reported separately from PPE, increased to Rs 198.3315 crore from Rs 152.3234 crore. The filing does not attribute the movement in PPE solely to the depreciation regularisation.

What does Diamond Power’s disclosure say to watch next?

Diamond Power’s next financial disclosures will show the ongoing use of the reconstructed PPE register and the revised useful-life methodology after 30 September 2026. The specific treatments to track are the 15-year useful life for plant and machinery and the 10-year useful life for electrical installations, both applied from 1 April 2022.

A separate funding event is also relevant to subsequent balance-sheet reporting. During the quarter ended 30 September 2026, Diamond Power raised Rs 1,613.97 crore through a qualified institutional placement, or QIP, by issuing 7.11 crore equity shares of face value Rs 1 each at an issue price of Rs 227 per share.

Diamond Power had utilised Rs 1,097.78 crore of QIP proceeds by 30 September 2026, leaving Rs 516.19 crore unutilised. The company said the balance was held in bank accounts and fixed deposits and was intended for the objects in the placement document, including working capital, capital expenditure, general corporate purposes and issue-related expenses.

The QIP disclosure shows Rs 489.08 crore used for working capital, Rs 33.17 crore for capital expenditure and Rs 340 crore for repayment of outstanding borrowings by 30 September 2026. Diamond Power also said its discharge from criminal consequences in CBI, ED and PLMA matters could facilitate release of attachments and encumbrances, working-capital borrowings and recovery of pre-NCLT receivables; these are company statements about possible future effects.

Conclusion

Diamond Power has completed a reconstruction exercise rooted in the 2018 loss of records, the August 2018 insolvency process and the June 2022 management transition. Its disclosed pre-takeover depreciation shortfall of Rs 380.9256 crore was adjusted through capital reserve, while the filing says a separate post-takeover shortfall was taken to retained earnings without providing a readable amount in the supplied text. Depreciation through 30 September 2026 was calculated at regularised statutory rates.

The next point to watch is the continued application of the revised useful-life estimates in future results, alongside deployment of the Rs 516.19 crore of unutilised QIP proceeds at 30 September 2026. Diamond Power’s disclosed plan allocates the remaining funds among working capital, capital expenditure, general corporate purposes and issue-related expenses.