Danish Power

Despite global operating environment volatility due to geopolitical tensions and supply chain issues, India's long-term electrical infrastructure story remains strong. Grid modernization, renewable energy build-out, and data center expansion are structural demand drivers expected to sustain transformer demand for at least 5-7 years. The underlying demand environment for the industry remains healthy, positioning Danish Power to capture demand with quality orders and margins.

Both phases of the company's capacity expansion, planned post-IPO, are now fully commissioned and operational. This has increased transformer manufacturing capacity to approximately 11,000 MVA on an annual basis. The new facility features temperature-controlled shop floors, advanced testing infrastructure, and ESG compliant manufacturing processes, significantly upgrading quality and technological readiness.

The new facility has activated the power transformer division, upgrading capabilities to manufacture transformers up to 100 MVA and 245 KV voltage class. Prototype development and type testing processes have commenced, with formal customer qualifications expected throughout FY27. This segment is anticipated to become a meaningful contributor to revenue from FY28 onwards, despite high entry barriers.

Backward integration, initiated through a subsidiary, is progressing well with a sheet metal fabrication facility. This facility, with a capital outlay of approximately INR 20+ crores, is expected to be commissioned in the next three to four months. The objective is to internalize a key manufacturing component, improving lead times, quality consistency, and operational control.

Danish Power has started supplying transformers for battery energy storage applications, identifying it as an upcoming high-demand growth segment. The company is also building capacities for dry-type transformers to cater to rising demand from data centers. Export revenue has significantly jumped to 8-9% this year, with a continued focus on profitable export growth rather than volume-led expansion, targeting 15-20% export share for FY27.

For FY26, Danish Power delivered a consolidated revenue of INR 521 crores, representing 22% YoY growth. The company maintained healthy EBITDA margins of approximately 19% and achieved a PAT of INR 69 crores, growing 26% YoY. For FY27, the company guides for revenue exceeding INR 700 crores and aims to sustain EBITDA margins around 19%, based on current order visibility and market outlook.

The company's strategic priorities include disciplined order selection, execution, customer quality, and sustaining profitability. Crisil ratings upgraded Danish Power to A minus from triple B, reflecting a valuable step forward. The company has also voluntarily adopted IndAS financial reporting for more efficient and systematic financial reporting.