Rajesh Power Services has secured a turnkey order worth ₹1,629 crore from Dakshin Gujarat Vij Company Limited to modernize power networks. This contract expands the company's order book to approximately ₹5,400 crore. Investors should monitor how the company manages the execution timeline and working capital requirements for this large two-year project.
Rajesh Power Services has secured a major infrastructure contract from Dakshin Gujarat Vij Company Limited (DGVCL), valued at ₹1,628.74 crore. The project involves upgrading electrical distribution infrastructure by transitioning existing overhead lines to underground cabling systems. The scope also includes the integration of SCADA-compatible technology, which allows for remote monitoring and control of the power network. This turnkey project, where the company handles everything from design to final commissioning, is scheduled to be completed over the next 24 months.
Impact on Order Book and Growth
The addition of this contract marks a significant jump in the company's project pipeline. The total order book has grown by approximately 35%, rising from ₹4,000 crore to roughly ₹5,400 crore. This development follows a period of strong financial performance for the company. In the first half of fiscal year 2027, Rajesh Power Services reported a 46% year-on-year rise in revenue to ₹929.26 crore, with a net profit of ₹79.22 crore, marking a 34.8% increase compared to the same period last year. The consistent growth in the order book suggests a strong demand for infrastructure upgrades in the power sector.
Financial and Operational Risks
While the order win is a positive development for revenue visibility, investors should consider the specific challenges associated with large-scale EPC (engineering, procurement, and construction) projects. The company faces a geographic and client concentration risk, as a significant portion of its work is dependent on state-owned power distribution companies, particularly in Gujarat.
Additionally, projects of this scale often require substantial working capital. In this industry, payments are frequently tied to specific project milestones, which can sometimes lead to cash flow pressure if receivables are delayed or if project execution faces unexpected hurdles. Investors may want to track the company's ability to maintain efficient capital usage while scaling up its operations over the 24-month execution window. Potential raw material price fluctuations could also impact project margins if not managed effectively through appropriate contract terms.
Market Reaction
The company’s stock was trading in the range of ₹825–830 as of November 5, 2026, following the announcement of the order. Market participants will likely focus on future updates regarding the project’s commissioning schedule and any further order wins from other regional power distribution companies. The key monitorables for shareholders moving forward will be the company’s ability to execute these large projects on time without a significant increase in debt or strain on cash reserves.