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    Hitachi Energy

    POWERINDIA
    Capital Goods·26 May 2026
    Management Summary

    Hitachi Energy reported a strong Q4 and full year FY26, driven by robust order inflows and efficient execution, leading to significant revenue and profit growth. The company achieved a record order backlog of ₹29,555.3 crores, providing substantial revenue visibility. Strategic investments totaling ₹4,000 crores are underway to expand manufacturing capabilities, particularly for large power transformers and power quality products, to capitalize on strong demand from renewables, data centers, and grid expansion, despite ongoing geopolitical and inflationary pressures.

    Highlights

    5

    • Full year FY26 revenue of ₹8,147.7 crores, up 27.6% YoY, demonstrating consistent execution.

    • Full year FY26 PAT of ₹987.8 crores, up 157.3% YoY, with PAT margin at 12.1% (vs 6% last year).

    • Record order backlog of ₹29,555.3 crores as of March 31, 2026, an increase of 53.6% YoY.

    • Q4 FY26 revenue grew 46.2% YoY to ₹2,754.1 crores, and PBT margin improved to 16.1% (vs 13.1% last year).

    • Additional ₹2,000 crores capex approved for a new large power transformer facility and power quality lines, bringing total cumulative capex to ₹4,000 crores, to capture strong demand outlook.

    Concerns

    3

    • Gross margins contracted sequentially in Q4 FY26 due to product mix, though full year gross margins improved to 40%.

    • Geopolitical situation in the Middle East and elevated transport charges are causing pressure on supply chains and inflated freight costs, which are not fully passable to customers.

    • Analyst noted potential weakness in domestic non-HVDC order inflow for FY26, though management stated overall domestic growth.

    Key financials

    Metrics

    6

    Periods

    2

    Q4 FY26

    3
    • Revenue
      ₹2,754.1 Cr
      YoY+46.2%QoQ+32.3%
    • PBT
      ₹443.4 Cr
      QoQ+10.3%
    • PAT Margin
      12%

    FY26

    3
    • Revenue
      ₹8,147.7 Cr
      YoY+27.6%
    • PAT
      ₹987.8 Cr
      YoY+1.6%
    • EBITDA Margin
      15.4%

    Order Book

    high confidence

    Total Value

    ₹ 29,555.3 crores

    as of 2026-03-31

    quantified
    53.6% YoY

    Inflow this qtr

    ₹ 2,422.5 crores

    Execution

    executable over several quarters

    Composition

    HVDC(product)
    66.0%
    Product Segment(sector)
    Utilities & Direct End Customers(client type)
    Exports (FY26)(geography)
    25.0%

    Pipeline

    deal pipeline tcv

    Robust pipeline for transformers across various segments, including 3-4 HVDC projects expected in the next 2 years.

    "The record order backlog provides strong revenue visibility for several quarters, supported by consistent execution and a resilient business model."

    Source:
    Prepared remarks

    Capital allocation

    1
    high confidence
    CategoryHeadline
    Capex

    ₹4,000 crores

    new plan — additional investment to accelerate execution and capture strong demand

    Guidance & targets

    4
    CategoryTargetPriority
    Capacity
    New transformer capacity (GVA)
    30-40 GVA
    		High
    Capex
    Total cumulative capex
    ₹4,000 crores
    		High
    Market Opportunity
    Data center market size in India
    13-18 GW
    		Medium
    Market Opportunity
    Hitachi Energy's share of data center capex
    15%
    		High

    Progress on additional ₹2,000 crores capex

    next quarter / H2 FY27
    CurrentGroundbreaking ceremony on June 12, 2026
    TargetConstruction progress and initial milestones for new transformer facility

    Why it matters

    This significant investment is crucial for future capacity and capturing demand in key growth segments like renewables and data centers.

    But this additional Rs. 2,000 Crores, which we announced, and we are doing the groundbreaking ceremony on 12th of June.

    How to verify

    capital_allocation.capex.purposes[description='Greenfield large power transformer facility in Karjan, Vadodara']

    Risks & concerns

    3
    RiskSeverity

    Volatile geopolitical environment

    Impacts supply chains and creates inflationary pressures. — Management acknowledged

    medium

    Supply chain pressure and inflated freight costs

    Geopolitical situation in the Middle East and elevated transport charges are causing pressure, with some costs (like freight) not fully passable. — Management acknowledged

    medium

    Inflationary commodity prices

    Elevated inflation and metal prices, though largely mitigated by price variation clauses in contracts. — Management acknowledged

    medium

    Q&A highlights

    8

    “our export strategy is a 3-prong strategy. So, the number one is we have certain allocated markets. And in the allocated markets, on a long-term basis, together with the local sales and marketing organizations, we start selling the products. No 2 Hitachi Energy companies will compete in any market. We develop the market on a long-term basis. That's the first strategy. And the second one is, we do manufacture certain products only in India in the whole Hitachi Energy ecosystem. That's what we call a global feeder factory. ... Thirdly, we manufacture a component which is part of the full product, what we call the feeder factories.”

    Clarifies the multi-faceted approach to export orders, including allocated markets, unique product manufacturing in India, and component supply to other Hitachi Energy entities globally, ensuring no internal competition.

    asked by Parikshit Kandpal

    2 min read6 chapters

    Detailed Narrative

    01

    Strong Financial Performance in FY26

    Hitachi Energy delivered a strong performance in Q4 and full year FY26. For the full year, revenue grew 27.6% YoY to ₹8,147.7 crores, with PAT increasing by 157.3% to ₹987.8 crores, resulting in a PAT margin of 12.1%. Operational EBITDA for FY26 stood at 15.4%. Q4 FY26 saw revenue growth of 46.2% YoY to ₹2,754.1 crores and a PBT margin of 16.1%, reflecting solid operational execution despite a challenging environment.

    02

    Record Order Backlog and Growth Drivers

    The company achieved a record order backlog of ₹29,555.3 crores as of March 31, 2026, representing a 53.6% YoY increase and providing strong revenue visibility. Full year order intake was ₹18,456.5 crores, growing 1.6% YoY. HVDC projects constitute approximately two-thirds of the order book and contributed about 15% to FY26 revenues, being margin-accretive. Growth drivers include renewables, data centers, transmission, and industrial capex, with exports contributing around 25% of full year revenue.

    03

    Strategic Capacity Expansion for Future Demand

    Hitachi Energy's Board approved an additional investment of ₹2,000 crores, bringing the total cumulative capex to ₹4,000 crores. This investment is primarily for establishing a greenfield large power transformer facility in Karjan, Vadodara, and adding two new lines for power quality products in the Bangalore factory. The new transformer facility aims to produce 30-40 GVA of capacity by Q4 2028, doubling existing capacity and positioning the company to capture strong demand from new sectors like data centers and renewables.

    04

    Sustainability and Operational Excellence

    Sustainability remains central to the company's strategy, achieving 100% renewable energy in operations and an 11% reduction in water usage from the 2019 baseline. The Halol facility earned a Water Positive Index certificate, and both Halol and Mysore facilities are certified platinum for zero waste to landfill. The company reported zero fatalities in FY26, reinforcing its commitment to safety. ESG ratings improved, with Crisil rating at 61 ('strong') and NSE rating at 62 ('adequate').

    05

    Market Outlook and Data Center Opportunity

    India's energy landscape is undergoing structural transformation driven by energy security, policy support, and accelerating electrification. The data center market in India, currently less than 2 gigawatts, is projected to grow 6-9 times to 13-18 gigawatts in the next 5 years. Hitachi Energy estimates that 15% of data center capex is attributable to its offerings, presenting a significant growth opportunity. The company is also exploring opportunities in energy storage, with projections of 80 gigawatts over the next 5-6 years.

    06

    Navigating Geopolitical and Inflationary Pressures

    The company is actively navigating a volatile geopolitical environment, which has led to supply chain pressures, elevated inflation, and increased metal and transport prices. While commodity price increases are largely passed through to customers via price variation clauses in contracts, inflated freight costs remain a challenge. Management is implementing several initiatives to mitigate these risks and maintain operational efficiency, believing the temporary industry slowdown🌐 is now behind them.

    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.