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    Power Grid Corpn

    POWERGRIDGood
    Power·21 May 2025
    Management Summary

    POWERGRID delivered a strong FY25 with record CAPEX of ₹26,255 Crore and massive TBCB wins of ₹92,000 Crore. However, capitalization significantly missed guidance at ₹9,014 Crore vs ₹16,000-17,000 Crore target, primarily due to RoW challenges. Management guided aggressive CAPEX ramp to ₹28,000-30,000 Crore in FY26 and ₹45,000 Crore by FY28, with capitalization expected at ₹23,000-25,000 Crore in FY26.

    Highlights

    8

    • FY25 standalone income of ₹46,325 Crore with PAT of ₹15,354 Crore; consolidated income ₹47,459 Crore, PAT ₹15,521 Crore

    • Q4 standalone income ₹12,482 Crore, PAT ₹4,336 Crore; consolidated income ₹12,591 Crore, PAT ₹4,143 Crore

    • CAPEX of ₹26,255 Crore in FY25, surpassing ₹20,000 Crore target; 5-year CAGR of 23.5%

    • Capitalization of ₹9,014 Crore vs ₹7,618 Crore YoY, but missed ₹16,000-17,000 Crore target due to RoW delays

    • Won 24 TBCB projects worth ₹92,000 Crore in FY25 with 57% market share

    • Works in hand of ₹1,54,680 Crore; business outlook 2032 of ₹3,06,600 Crore

    • Telecom income crossed ₹1,000 Crore milestone at ₹1,128 Crore (vs ₹910 Crore YoY); consultancy revenue ₹799 Crore (vs ₹553 Crore)

    • EPS ₹16.69; book value ₹99.63; D/E ratio 59:41; RONW 16.75%

    Concerns

    1

    • Capitalization consistently missing guidance

    Key financials

    Metrics

    12

    Periods

    4

    Headline

    6
    • CAPEX FY25
      ₹26,255 Cr
    • Capitalization FY25
      ₹9,014 Cr
      YoY+18%
    • EPS
      16.69 Rs per share
    • Net Worth
      ₹92,663 Cr
    • Gross Fixed Assets
      ₹2.91L Cr

    Q4

    2
    • Income (Standalone)
      ₹12,482 Cr
    • PAT (Standalone)
      ₹4,336 Cr

    Consolidated, FY25

    2
    • Total Income
      ₹47,459 Cr
    • PAT
      ₹15,521 Cr

    Standalone, FY25

    2
    • Total Income
      ₹46,325 Cr
    • PAT
      ₹15,354 Cr

    Segment breakdown

    Transmission
    ₹36,877 Cr Billing FY25₹38,284 Cr Realization FY25
    Telecom
    ₹1,128 Cr Income FY25
    Consultancy
    ₹799 Cr Revenue FY25
    List

    Guidance & targets

    6
    CategoryTargetPriority
    Capital Expenditure
    CAPEX FY26
    ₹28,000-30,000 Crore
    		High
    Capital Expenditure
    CAPEX FY27
    ₹35,000 Crore
    		High
    Capital Expenditure
    CAPEX FY28
    ₹45,000 Crore
    		Medium
    Capitalization
    Capitalization FY26
    ₹23,000-25,000 Crore
    		High
    Returns
    TBCB ROE threshold
    Above 12-13%
    		High
    Dividends
    Dividend per share
    May reduce further from ₹9
    		Medium

    Risks & concerns

    7
    RiskSeverity

    Capitalization consistently missing guidance

    FY25 capitalization was ₹9,014 Crore vs ₹16,000-17,000 Crore target. Q4 alone was guided at ₹11,000 Crore but missed significantly. RoW, supply issues, and skilled manpower cited as reasons. — Analyst acknowledged

    high

    Declining bid pipeline visibility for FY26

    Visible pipeline of ₹46,000 Crore for FY26 vs ₹92,000 Crore wins in FY25. Management says more will emerge in 2-3 months. — Analyst downplayed

    medium

    ROE dilution from equity retention for capex

    ROE dipped 100bps at consolidated level. Net worth grew faster than profits. Dividend cut from ₹10.5 to ₹9, may reduce further. — Analyst acknowledged

    medium

    Leh-Ladakh HVDC technology and execution risks

    No worldwide experience at 4,500-5,000m altitude. Single bidder with concerns. Expected award in Q2 but has been repeatedly delayed. — Both acknowledged

    medium

    Equipment supply chain tightness

    Huge demand for transformers, GIS, conductors. Bulk procurement strategy adopted to mitigate, but supply constraints impacting timelines. — Management acknowledged

    medium

    Areas of Evasion(2)

    • Intra-state TBCB project sizes not shared
    • Exact HVDC capex breakdown deferred

    Q&A highlights

    3

    “there are challenges of ROW and supply issues and skill manpower... in 2025-26, execution will be much faster as compared to FY 2024-25”

    FY25 capitalization was only ₹9,014 Crore vs ₹16,000-17,000 Crore guidance, a major miss that impacts near-term revenue growth

    asked by Sumit Kishore

    1 min read5 chapters

    Detailed Narrative

    01

    Record CAPEX and TBCB Wins But Capitalization Disappointment

    POWERGRID achieved record CAPEX of ₹26,255 Crore in FY25, exceeding the ₹20,000 Crore target. Won 24 TBCB projects worth ₹92,000 Crore with 57% market share. However, capitalization at ₹9,014 Crore significantly missed the ₹16,000-17,000 Crore guidance due to RoW delays in Rajasthan, Haryana, Delhi, and Gujarat. FY26 capitalization guided at ₹23,000-25,000 Crore.

    02

    Massive Business Pipeline Through 2032

    Works in hand stand at ₹1,54,680 Crore including ₹1,05,000 Crore TBCB. Business outlook 2032 is ₹3,06,600 Crore (₹2,70,000 Crore ISTS, balance in other businesses). NEP 2032 envisions ₹9-10 lakh crore in transmission, with only ₹3 lakh crore awarded so far, implying ₹6 lakh crore remaining to be bid by 2029-30.

    03

    Telecom and Consultancy Hitting New Milestones

    Telecom segment crossed ₹1,000 Crore income for the first time at ₹1,128 Crore (vs ₹910 Crore), adding 75 new customers. Data centers being built at Manesar and Chennai. Consultancy revenue grew 44% to ₹799 Crore with 55 new domestic orders and 8 international orders.

    04

    RoW Compensation Policy Evolution Creating Near-term Pain

    Government of India changed RoW land compensation from 15% to 30% (June 2024), tower base from 85% to 200%. In March 2025, further revised to 60% urban/45% semi-urban with market rate pricing. These changes caused delays as states adopted new policies. Management expects claims under change-of-law to recover additional costs.

    05

    HVDC Project Pipeline Provides Multi-year Growth Visibility

    Key HVDC projects: Leh-Kaithal (₹20,000+ Crore, Q2 award expected), Khavda-South Olpad (RFP out, VSC-based), Barmer-Maharashtra (LCC), Kurnool-Vizag (LCC). International projects include India-Singapore via Andaman (₹30,000+ Crore, 2,000MW), India-Sri Lanka, and India-Myanmar. One Sun One World One Grid connecting to UAE/Oman/Saudi Arabia on VSC technology.

    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.