Powergrid FY25 Annual Earnings Summary
4 quarters covered · ₹47,460 Cr revenue · ₹15,522 Cr PAT · 0.0% average EBITDA margin.
Quarter-by-quarter progression
Management promises made during the year
Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q1 FY25Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q2 FY25Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q2 FY25Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q3 FY25Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q4 FY25Current-quarter commentary contains related risk or weakness, so the promise appears not to have been delivered yet.
Q4 FY25Risks flagged during the year
Management acknowledged that transformers, reactors, and GIS are in tight supply, with costs rising 70-80% since 2017-18, potentially delaying projects.
Q1 FY25 · mediumThe offshore wind evacuation projects (INR 13,100 crore total) are India's first, and management noted costs may be higher than routine projects, posing execution risk.
Q1 FY25 · mediumManagement could not confirm if the 125 GW RE requirement for green hydrogen is included in the National Electricity Plan, indicating potential policy uncertainty.
Q2 FY25 · mediumEESL contributed a loss of INR 100 crore in H1 FY25 due to mounting receivables and interest costs, with no clear timeline for reversal.
Q2 FY25 · mediumNew CERC tariff regulation (2024-29) reduced O&M charges by INR 600 crore annually, impacting profitability by ~INR 300 crore in H1.
Q2 FY25 · mediumRevenue from legacy RTM projects is declining due to lower depreciation and interest, partially offsetting growth from new TBCB projects.
Q3 FY25 · mediumManagement acknowledged challenges in land acquisition (ROW issues) and supply of high-voltage transformers and GIS equipment, which could delay project commissioning beyond the typical two-year timeline.
Q3 FY25 · mediumThe CERC tariff true-up impacted Q3 PAT by INR 140 crore, and the nine-month impact is ~INR 440 crore. This regulatory adjustment could continue to weigh on earnings.
Q3 FY25 · mediumManagement reduced the interim dividend per share (from INR 4.5 to INR 3.25) to conserve equity for the growing CapEx pipeline. Further reductions are possible if CapEx continues to rise.
Q4 FY25 · mediumROW compensation policy changes and state-level adoption delays caused commissioning slippages in FY25; may persist.
Q4 FY25 · mediumCurrent TBCB pipeline is only INR 45,000-46,000 crore, significantly lower than INR 92,000 crore won in FY25, which could slow order book growth.
Q4 FY25 · mediumROE dipped ~100bps YoY as net worth grew faster than profits; further dilution possible if CapEx ramp-up requires equity.
What changed through the year
Q1 FY25 · FY25 CapEx raised to INR 18,000 crore
Management increased CapEx guidance from INR 15,000 crore to INR 18,000 crore due to new project wins requiring spending this fiscal.
Q1 FY25 · Capitalization target of INR 18,000 crore in FY25
Target to commission projects worth INR 18,000 crore in FY25, with INR 25,000-30,000 crore expected in each of FY26 and FY27.
Q1 FY25 · Bidding pipeline of INR 100,000+ crore
Over INR 100,000 crore of transmission projects are in the pipeline, with 70-80% expected to be awarded in FY25.
Q1 FY25 · Data center Phase I commissioning in Q4 FY25
The 1,000-rack data center at Manesar is expected to be commercially available by Q4 FY25, with Phase II of INR 2,000 crore planned.
Q2 FY25 · CapEx target of INR 18,000 crore for FY25, likely to exceed INR 20,000 crore
Management expects CapEx to be at least INR 18,000 crore this fiscal, with potential to exceed INR 20,000 crore.
Q2 FY25 · CapEx of INR 25,000-30,000 crore in FY26
Next fiscal CapEx is guided to be between INR 25,000 and INR 30,000 crore.
Q2 FY25 · Capitalization to reach INR 35,000-40,000 crore in 2-3 years
Capitalization is expected to ramp up to INR 35,000-40,000 crore per annum as projects are commissioned.
Q2 FY25 · Target win rate of ~50% in TBCB projects
Management expects to win about 50% of upcoming TBCB projects, translating to INR 192,000 crore additional orders by 2032.
Q3 FY25 · FY25 CapEx target of INR 23,000 crore
Management reiterated the FY25 CapEx plan of INR 23,000 crore, with INR 19,480 crore already spent by January 31, 2025.
Q3 FY25 · FY25 capitalization target of INR 18,000 crore
Capitalization target for FY25 is INR 18,000 crore, with INR 7,906 crore achieved by January 31, 2025. Management expects to commission ~INR 10,000 crore in the remaining 45-50 days.
Q3 FY25 · FY26 CapEx guidance of INR 28,000-30,000 crore
For FY26, CapEx is expected to be in the range of INR 28,000-30,000 crore, driven by the strong project pipeline.
Q3 FY25 · FY27 CapEx guidance of INR 35,000 crore
For FY27, CapEx is expected to be around INR 35,000 crore, with potential upside from additional HVDC projects.
Q4 FY25 · CapEx of INR 28,000 crore for FY26
Management guided CapEx of INR 28,000 crore for FY26, with potential to increase to INR 30,000 crore based on project wins.
Q4 FY25 · CapEx of INR 35,000 crore for FY27 and INR 45,000 crore for FY28
Management provided CapEx targets of INR 35,000 crore for FY27 and INR 45,000 crore for FY28.
Q4 FY25 · Capitalization of INR 23,000-25,000 crore in FY26
Management expects capitalization of INR 23,000-25,000 crore in FY26, up from INR 9,014 crore in FY25.
Q4 FY25 · Dividend payout may reduce further
Management indicated dividend per share could reduce from INR 9 in FY25 due to higher CapEx requirements.