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    Power & Instrumentation (Gujarat) Limited

    PIGL
    Capital Goods·20 Aug 2025
    Management Summary

    Power & Instrumentation (Guj.) Limited delivered strong Q1 FY26 financial performance with significant revenue and net profit growth, driven by strategic contract wins in aviation and power distribution. The company is actively diversifying its portfolio and expanding capabilities, including the acquisition of a 60% stake in Peaton. Despite Q1 margin pressure due to project mix and seasonal factors, management remains confident in achieving its full-year growth and margin targets, supported by a robust order book and pipeline.

    Highlights

    5

    • Consolidated total income for Q1 FY26 stood at INR 41.55 crores, raising a robust year-on-year growth of 59.83%.

    • Net profit surged by 40.18% to INR 2.62 crores in Q1 FY26.

    • Secured an INR 80.24 lakh contract from Godrej & Boyce and six contracts worth INR 57.89 crores for the Udaipur Airport Project, marking a major step into aviation-linked infrastructure.

    • Won a significant new order worth INR 70.55 crores from Ajmer Vidyut Vitran Nigam Limited under the RDSS scheme.

    • The company is celebrating 50 years of operations, leveraging this milestone for future growth and value creation.

    Concerns

    3

    • EBITDA grew by 17.36% to INR 4.28 crores, resulting in a Q1 margin of 10.30%, which was noted as 'somber' compared to the previous year's corresponding quarter.

    • Installation activities were slowed down in Q1 due to monsoon rains, impacting execution and margin recognition.

    • Tender finalization has been delayed due to elections, government transfers, and Gram Panchayat elections, affecting the pace of new order conversions.

    What Changed2

    vs Q3 FY26

    Guidance items5 → 4 (-1)Risks discussed2 → 3 (+1)

    Key financials

    Single quarter

    04 metrics
    1. 01Consolidated Total Income₹41.55 Cr+59.8%YoY
    2. 02EBITDA₹4.28 Cr+17.4%YoY
    3. 03Net Profit₹2.62 Cr+40.2%YoY
    4. 04EBITDA Margin10.3%

    Order Book

    high confidence

    Total Value

    ₹ 400 crores

    as of 2025-08-20

    quantified

    Inflow this qtr

    ₹ 129.24 crores

    Execution

    Timelines are like anything between 24 months to 12 months.

    Pipeline

    qualified rfp

    Bid value for tenders in the range of INR 390-415 crores; Ajmer Vidyut Vitran Nigam Limited looking to float tenders for 1200 substations in next 4-5 years.

    "The company is comfortably placed to execute anticipated numbers and is actively bidding for larger projects, leveraging tie-ups for eligibility."

    Source:
    Q&A

    Capital allocation

    3
    high confidence
    CategoryHeadline
    Debt

    Gross ₹15 crores

    M&A

    Peaton

    acquisition · pending regulatory

    Liquidity

    Liquidity disclosed

    Internal accruals are expected to be sufficient for the current year and part of the next year, reducing the immediate need for external working capital.

    Guidance & targets

    4
    CategoryTargetPriority
    Revenue
    Revenue Growth
    50%
    		High
    Margin
    EBITDA Margin
    13-15%
    		High
    Order Book
    Order Book Value
    Double the closing amount
    		High
    Peaton Revenue
    Peaton Revenue Scale
    INR 100 crores
    		High

    Peaton Acquisition Closure

    next month
    CurrentPaperwork ongoing, 60% stake acquired
    TargetAcquisition closed

    Why it matters

    Formal closure of the acquisition is key to fully integrating Peaton and realizing its strategic benefits for diversified solutions and revenue growth.

    So basically, the acquisition got a little delayed, but the paperwork is going on, I think, should be done very soon, should be completed very soon. ... And when do you anticipate the paperwork will be done for Peaton? I think maybe in a month's time or so.

    How to verify

    capital_allocation.m_and_a[target='Peaton'].status

    Risks & concerns

    3
    RiskSeverity

    Q1 Margin Pressure

    EBITDA margins in Q1 were 'somber' compared to the previous year, attributed to the project mix (supply-heavy) and monsoon-related installation slowdown. — Analyst acknowledged

    medium

    Tender Finalization Delays

    Finalization of tenders has been delayed due to general elections, government transfers, and Gram Panchayat elections, impacting the conversion of pipeline into orders. — Management acknowledged

    medium

    Working Capital Requirements for Growth

    An analyst raised concerns about working capital needs for aggressive growth, but management stated that internal accruals, past fundraising, and improved receivable days should be sufficient for the current and part of the next year. — Analyst downplayed

    low

    Q&A highlights

    8

    “Q1, the margins have been a little bit somber compared to the last year corresponding quarter. But on an average, for the full year, should we expect about 10% double-digit margin that is there, at least for the last couple of years? ... Yes, definitely the quarter one had a certain impact. Actually, see, the ratio of our work, it is against supply and installation. There are two portions to it, basically. ... I mean, maybe a 14% to 13%, 14%, 15% of EBITDA. That's what we're looking at.”

    Clarified the reason for lower Q1 margins and reiterated the higher full-year EBITDA margin target, linking it to project execution cycles.

    asked by Paras Chheda

    3 min read6 chapters

    Detailed Narrative

    01

    Strong Q1 FY26 Performance and Strategic Wins

    Power & Instrumentation (Guj.) Limited reported a robust Q1 FY26, with consolidated total income growing 59.83% year-on-year to INR 41.55 crores. Net profit surged 40.18% to INR 2.62 crores, reflecting the resilience of the business model. The company secured significant contracts, including an INR 80.24 lakh project from Godrej & Boyce, a prestigious INR 57.89 crores for the Udaipur Airport, and an INR 70.55 crores order under the RDSS scheme in Rajasthan, highlighting its technical capabilities and diversification strategy.

    02

    Peaton Acquisition and Product Portfolio Expansion

    The company is in the final stages of acquiring a 60% stake in Peaton, a manufacturing firm specializing in low voltage, high voltage panels, and compact busway systems, with paperwork expected to conclude within a month. This acquisition aims to provide comprehensive solutions, particularly for the aviation sector, leveraging licenses from Siemens and Rittal Germany. Peaton, which had a turnover of INR 34 crores last year with 7-8% EBITDA margins, is projected to scale to INR 100 crores in 1.5-2 years, significantly contributing to the company's growth.

    03

    Diversification and Market Opportunity in Power Sector

    PIGL is strategically diversifying its portfolio across various segments within the electricity domain, including EHV, RDSS, and aviation-linked infrastructure, to mitigate risks and capitalize on India's bullish infrastructure landscape. The power sector is projected to see INR 40 lakh crores investment over the next decade, with significant outlays in airport infrastructure (INR 60,000 crores by FY27) and distribution schemes like RDSS and Deendayal Upadhyaya Gram Jyoti Yojana (INR 43,033 crores). The company is actively bidding for larger EHV projects and sees ample opportunities in the modernization of power distribution networks.

    04

    Q1 Margin Dynamics and Full-Year Outlook

    While Q1 FY26 EBITDA grew 17.36% to INR 4.28 crores, resulting in a 10.30% margin, management acknowledged this was 'somber' compared to the previous year. This was attributed to the Q1 being supply-heavy, which typically yields lower margins than the execution-heavy Q3/Q4, and a slowdown in installation due to monsoon rains. However, the company maintains a full-year EBITDA margin target of 13-15%, expecting improvement as execution picks up in later quarters.

    05

    Order Book Visibility and Execution Strategy

    The un-executed order book stands at approximately INR 400 crores, with a bid pipeline also in the INR 390-415 crores range. Management aims to double the order book by March 2026 and is prepared to bid for projects up to INR 300-400 crores, leveraging tie-ups for eligibility. Project execution timelines typically range from 12 to 24 months, with daily monitoring to ensure timely completion, as exemplified by the Udaipur Airport project targeting completion by March 2026.

    06

    Human Resources and Operational Preparedness

    To support its aggressive growth targets, the company has established a full-fledged HR department and has added 12 professionals in the last 3-4 months for both Power & Instrumentation and Peaton. Recruitment is ongoing, and systems, including updated software and HR tools, are in place. The company is also expanding its marketing team, with a senior hire expected soon, to support new product launches and broader market reach.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.