CG Power Surges 8% Post Q3 Earnings; Brokerages Cautiously Optimistic

INDUSTRIAL-GOODSSERVICES
Whalesbook Logo
AuthorKavya Nair|Published at:
CG Power Surges 8% Post Q3 Earnings; Brokerages Cautiously Optimistic
Overview

CG Power and Industrial Solutions shares surged over 8% following its Q3 results announcement. The company reported an 18% year-on-year increase in net profit to ₹284.83 crore and a revenue jump to ₹3,175.35 crore. Brokerages, while acknowledging strong execution and order backlog, expressed cautious optimism due to commodity inflation and potential competition, leading to target price adjustments.

Strong Q3 Performance Boosts CG Power Stock

CG Power and Industrial Solutions shares climbed 8.1% to ₹574.65 on Tuesday, reaching an intra-day high after the company released its third-quarter financial results. The market's positive reaction followed a significant uptick in profitability and revenue.
The company posted a consolidated net profit of ₹284.83 crore for the December quarter (Q3FY26), marking an 18% increase from ₹240.53 crore in the same period last year. Revenue from operations also saw a robust expansion, rising to ₹3,175.35 crore from ₹2,515.68 crore year-on-year.

Brokerage Views Mixed Amid Headwinds

Analysts offered a spectrum of opinions, with several cautiously optimistic despite trimming targets. Nomura maintained a 'Buy' rating but lowered its target price to ₹820 from ₹880. The brokerage cited earnings missing estimates, prompting a 7-9% reduction in EPS forecasts for FY26-FY28.
Nomura highlighted concerns over commodity inflation, particularly copper prices, and potential competition from China. These factors, alongside higher semiconductor losses and front-loaded costs, led to revised EBITDA estimates and a trimming of the valuation multiple, though the firm still expects a 32% EPS CAGR over FY26-FY28.
Emkay Global Financial Services upgraded CG Power to 'Buy' from 'Add', reducing its target to ₹775 from ₹850. Emkay pointed to valuation comfort after a recent stock correction and strong execution in both Power Systems and Industrial Systems segments, supported by a substantial order backlog.
The company secured order inflows of ₹4,400 crore, expanding its order book to ₹15,750 crore, a 62% year-on-year increase. Exports also showed strength, up 50% in the first nine months of FY26. Emkay acknowledged pressures on Industrial Systems margins due to price realisations and input costs but remains positive on the company's execution trajectory.

Disclaimer:This content is for educational and informational purposes only and does not constitute investment, financial, or trading advice, nor a recommendation to buy or sell any securities. Readers should consult a SEBI-registered advisor before making investment decisions, as markets involve risk and past performance does not guarantee future results. The publisher and authors accept no liability for any losses. Some content may be AI-generated and may contain errors; accuracy and completeness are not guaranteed. Views expressed do not reflect the publication’s editorial stance.