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Potential Chinese competition in transformers
View Risks →CG Power and Industrial Solutions Limited — Q3 FY26
CG Power delivered a strong Q3 FY26 with consolidated revenue of ₹3,175 crore, up 26% YoY, driven by robust power systems growth of 44% and a record order backlog of ₹15,753 crore (+62% YoY).
bullish
high
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CG Power delivered a strong Q3 FY26 with consolidated revenue of ₹3,175 crore, up 26% YoY, driven by robust power systems growth of 44% and a record order backlog of ₹15,753 crore (+62% YoY). The power systems segment saw margin expansion of 378 bps to 21.4%, while industrial margins contracted due to commodity cost headwinds. A landmark ₹900 crore power transformer export order for a US data center underscores growing export momentum. Management remains bullish on domestic power demand through 2029, with capacity expansion ahead of schedule. Risks include potential Chinese competition in transformers and margin pressure in industrial segments from commodity inflation.
CG Power का Q3 FY26 का नतीजा शानदार रहा। कंपनी की कुल कमाई ₹3,175 करोड़ रही, जो पिछले साल से 26% ज्यादा है। इसकी वजह बिजली उपकरणों की बिक्री में 44% का उछाल और ₹15,753 करोड़ का रिकॉर्ड ऑर्डर बैकलॉग है। बिजली उपकरणों के मुनाफे में 3.78% का सुधार हुआ, लेकिन औद्योगिक हिस्से में कच्चे माल की बढ़ती कीमतों से मुनाफा कम हुआ। अमेरिका के डेटा सेंटर के लिए ₹900 करोड़ का बड़ा ट्रांसफॉर्मर ऑर्डर मिला है। कंपनी को 2029 तक देश में बिजली की मांग बढ़ने की उम्मीद है। जोखिम में चीनी कंपनियों से मुकाबला और कच्चे माल की महंगाई शामिल है।
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Read Transcript →Quarter Snapshot
Order Backlog (Consolidated)
₹15,753 crore
+62% YoY
Record unexecuted order backlog as of Dec 31, 2025, providing multi-quarter visibility.
Power Systems Order Intake
₹2,046 crore
+16% YoY
Order intake grew 16% YoY, with backlog up 89% to ₹11,289 crore.
Transformer Capacity
40,000 MVA
+135% YoY
Capacity expanded from 17,000 MVA a year ago; targeting 65,000 MVA in one quarter.
Export Order Pipeline
>50% increase
+50% YoY
Export order bookings (excl. Jan 16 large order) grew >50% in 9M FY26 vs 9M FY25.
What Changed vs Last Quarter
NEW
Transformer capacity to reach 65,000 MVA in one quarter
Management guided that transformer capacity will increase from current 40,000 MVA to 65,000 MVA within the next quarter, ahead of original 2028 plan.
NEW
OSAT M2 plant ready by end of December 2026
The larger OSAT plant (M2) is expected to be ready by end of December 2026, with operations starting in Q4 FY27.
NEW
Switchgear brownfield expansion to add ₹400 crore revenue
A brownfield expansion near existing facility will be ready in a couple of months, adding about ₹400 crore incremental revenue.
NEW
Industrial price increases of 17% over nine months
Management has implemented cumulative price increases of ~17% over the last nine months to offset commodity inflation, with market absorption better than expected.
DROPPED
Exero revenue of ~$50M in FY26
Management expects the semiconductor design subsidiary to generate approximately $50 million in revenue for the current fiscal year.
DROPPED
Transformer capacity expansion to 40,000 MVA operational from Oct 1
The expanded transformer capacity from 15,000 MVA to 40,000 MVA became operational on October 1, 2025, and is expected to be fully utilized.
DROPPED
New switchgear capex of 748 crores approved
Board approved greenfield expansion for switchgear business with investment of 748 crores net of taxes to meet demand for MV and EHV products.
DROPPED
Exports target 35-40% of new transformer plant revenue
For the new transformer plant (45,000 MVA), management targets 35-40% of revenue from exports to ensure sustainability.
NEW RISK
Potential Chinese competition in transformers
Government may allow Chinese players to bid for PSU tenders, which could pressure pricing. Management downplayed near-term impact citing 2-4 year setup time.
NEW RISK
Railway business execution delays
Railway segment faced supply stoppages and service issues, impacting margins. New leadership appointed to address challenges.
NEW RISK
OSAT semiconductor losses to persist
Semiconductor segment reported a loss of ₹41 crore (130 bps impact) due to startup costs and deferred revenue; profitability not expected near-term.
RISK GONE
Slowdown in transmission project awards
Analyst noted slower award of interstate TBCB projects in H1 FY26, which could impact order conversion for power transformers and HV switchgear.
RISK GONE
Chinese competition in transformer market
Investor concern about potential government approval for Chinese players to enter the Indian transformer market, though management emphasized operational efficiency as defense.
RISK GONE
Execution delays in power transformer installations
India missed power transformer installation targets in H1 FY26, which could slow backlog conversion to sales, though management noted developers are taking deliveries despite project delays.
Fast read
Guidance and risk preview
Management guided that transformer capacity will increase from current 40,000 MVA to 65,000 MVA within the next quarter, ahead of original 2028 plan.
Government may allow Chinese players to bid for PSU tenders, which could pressure pricing.
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