Powergridofindia · risk themes across the available quarters.
Bear-case history
As explained by management, older RTM projects (commissioned 2010-13) are completing 12-year depreciation cycles, causing ~9% revenue reduction per old project due to lower depreciation (5.28% to ~1.2%) and declining interest on loan. TBCB projects yield lower returns (~10-15% vs 17% for RTM).
Laday HVDC project tender failed due to cost escalation from Rs 20,000 crore to Rs 42,000 crore and manufacturer constraints. Now being replaced by 400 KV AC project (estimated Rs 30,000 crore) with timeline still targeted 2029. Order book impact uncertain until government direction received.
Brahmaputra basin opportunity (~Rs 6.4 lakh crore through 2035+) may be bid out under TBCB rather than nominated to Power Grid, unlike initial expectations. Management indicated these are "normal HBDC projects in plain area" more suitable for competitive bidding.
Power Grid's first data center project (1,000 racks) has faced clarifications and issues, pushing commissioning from Q3 to Q4 FY26. No revenue contribution expected this fiscal year.
Domestic manufacturing capacity at 2.28 lakh MVA against projected demand of 4.21 lakh MVA in FY27. Government is considering relaxation for Chinese companies to set up manufacturing in India, which if approved would boost supply.
Though government guidelines (June 2024, March 2025, December 2025) have improved execution, ROW remains a pain point requiring continued engagement with state governments and chief ministers.
Management acknowledged this remains a challenge; discussions ongoing with government of India for resolution, though no timeline provided.
While maintaining 50-60% market share in TBCB projects, competition is intensifying with competitor claiming ₹75,000 crore works in hand including HVDC projects. HVDC projects have only 3 global manufacturers (Hitachi, ABB, Siemens) creating execution dependencies.