Whalesbook
A significant driver of the rally is a robust capital expenditure plan of ₹9 trillion for the transmission and distribution (T&D) sector through 2032. Analysts at Motilal Oswal Financial Services (MOFSL) note this sustained investment, which began in FY22-23, has substantially boosted order books, revenues, and profit margins for leading companies.
MOFSL sees the initial phase of an upcycle in transformers, expecting it to continue for several years. Companies are expanding capacity to meet both domestic and export demand, which should allow for healthy absorption without immediate price drops. While MOFSL acknowledges that valuations are no longer low, they believe potential earnings upgrades and expanding export markets could support current stock prices. The firm initiated coverage on CG Power and Industrial Solutions, Atlanta Electricals, and GE Vernova T&D India, assigning a 'Buy' rating to each.
Mirae Asset Sharekhan shares this positive view, pointing to strong order books and supportive government policies. They forecast robust execution growth for Q4FY26, with a projected 13% year-on-year increase driven by defense, T&D, and renewable energy sectors. The firm expects strong performance across the board, fueled by significant order intake in power, metro, railways, and data centers, and sustained optimism around public capital spending.