Deccan Gold Mines Set to Launch India’s First Gold Mine in 80 Years
With operations approved at Jonnagiri, Deccan Gold plans to extract 400 kg of gold by FY27, pushing stock to a 10-month high.
Deccan Gold Mines Breaks Ground on India’s First Post-Independence Gold Project
In a landmark moment for India’s mining landscape, Deccan Gold Mines Ltd. is on the verge of beginning operations at the Jonnagiri Gold Mine in Andhra Pradesh — the nation’s first gold mining venture since gaining independence. The company, working alongside its affiliate Geomysore Services (India) Pvt. Ltd., has received crucial clearance from the Andhra Pradesh Pollution Control Board (APPCB), paving the way for both extraction and processing activities to kick off at the site.
Hanuma Prasad Modali, the managing director of Deccan Gold, shared insights into the project’s potential, stating that the mine could eventually yield up to 750 kilograms of gold annually. However, during its initial phase, the company aims to extract 400 kilograms in the first operational year.
From Regulatory Approval to Operational Readiness
The APPCB’s clearance is a pivotal milestone that authorizes both mining activity and the operation of the gold processing facility. While the final regulatory barrier has now been cleared, Deccan Gold’s management has indicated that operations will not begin immediately. Trial runs are expected to take place over the next few months to ensure that systems are functioning efficiently before large-scale production starts.
The mined gold is expected to be sold to refineries located in close proximity to the project site, providing logistical ease and ensuring smooth monetization of output.
Gold Output and Financial Expectations for FY27
Looking ahead, the company anticipates a substantial revenue windfall in the financial year 2026–27 (FY27). If Deccan Gold achieves its target of extracting 400 kilograms of gold in the initial year, it estimates a revenue of ₹300–₹350 crore, supported by an EBITDA margin of approximately 60%. This high margin underlines the profitability potential of the Jonnagiri project.
As operations scale up, the company hopes to reach its full production capacity of 750 kilograms per year, creating a strong foundation for sustainable growth and earnings.
Stock Surges to 10-Month High on Project Announcement
News of the regulatory approval and operational launch has triggered a sharp rally in Deccan Gold Mines’ stock. The share price jumped as much as 14.28%, touching a high of ₹170.50 per share, marking its strongest level since August 6, 2024. As of 10:17 a.m., the share price had moderated somewhat, settling at ₹166.75 while maintaining a robust gain of 11.70% for the session.
This price movement came amid unusually high trading volumes, with activity reaching nearly 13 times the 30-day average, reflecting significant investor interest. The Relative Strength Index (RSI) stood at 49.23, signaling neutral territory without overbought or oversold conditions.
Long-Term Stock Performance Reflects Investor Optimism
Deccan Gold Mines has demonstrated robust performance in the broader market context as well. The stock has gained 58.42% over the past 12 months, and has delivered 46.70% year-to-date (YTD) returns. These figures highlight growing investor confidence, likely fueled by expectations surrounding the Jonnagiri project and optimism about India’s untapped gold mining potential.
This resurgence in gold mining activity is not just significant for Deccan Gold but also marks a notable shift in India’s resource exploration landscape, which has long been underdeveloped in terms of precious metal mining.
A Major Leap for Indian Mining and Resource Development
The Jonnagiri Gold Mine stands as a symbol of progress in India’s mining sector, which has historically seen limited activity in gold extraction. For decades, India has remained dependent on gold imports to meet domestic demand. The successful launch of this project could potentially reduce that reliance and inspire further exploration and development of mineral-rich regions across the country.
The project also brings with it socio-economic benefits, including job creation, infrastructure development, and state revenue generation in Andhra Pradesh. Moreover, Deccan Gold’s collaboration with Geomysore underscores the strategic value of partnerships in bringing long-term, capital-intensive mining projects to life.
Final Thoughts
Deccan Gold Mines’ journey toward launching India’s first post-independence gold mine is a landmark moment not only for the company but also for the nation’s mining sector. With production set to begin following final trial runs, the company expects to generate ₹300–₹350 crore in revenue in FY27 from 400 kg of gold, eventually ramping up to 750 kg annually.
The announcement has already ignited strong investor enthusiasm, sending the stock soaring to a 10-month peak. As India embarks on a renewed path of mineral exploration and domestic resource utilization, Deccan Gold is spearheading an initiative that could usher in a transformative chapter for domestic gold mining in India.
The image added is for representation purposes only
