Transformer sales to cross ₹40,000 crore by FY26 on T&D push: Report
electric transformer industry
are projected to rise 10-11% annually through next fiscal, taking the market size beyond ₹40,000 crore from an estimated ₹33,000 crore in FY25,
CRISIL Ratings
said on Tuesday.
The growth will be driven by significant investments in transmission and distribution (T&D) infrastructure to meet the sharp rise in electricity demand, as installed generation capacity is expected to increase from 485 GW to 570-580 GW, while peak demand is likely to jump over 20 per cent to 296 GW in the same period.
The
National Electricity Plan
(NEP) has targeted a 776,330 MVA increase in transformer capacity to 1,847,280 MVA by FY27, of which only 30% has been achieved till FY25, indicating the need for accelerated investments.
'The strong pipeline in power T&D is creating a revenue opportunity of ₹70,000-75,000 crore for the transformer sector through this and the next fiscal,' said Rahul Guha, senior director, CRISIL Ratings. 'Order books will swell to more than a year's sales from the current nine months, ensuring high sales visibility.'
CRISIL noted that capacity utilisation will climb above 80%, pushing up working capital requirements and capex, estimated at ₹200 crore by next fiscal. Companies are expected to take on additional debt to fund this, but credit profiles should remain stable due to healthy balance sheets and rising cash flows.
Replacement demand will also contribute, as units installed during 2000-05 reach the end of their average 25-year life. Operating margins are projected to hold at 8-10% with no aggressive bidding expected.
'Despite higher debt levels, our rated portfolio's gearing and interest coverage ratio will likely remain stable at 0.6x and 4x respectively through next fiscal,' said Nitin Kansal, director, CRISIL Ratings.
However, the agency flagged timely payments, pace of order awards, and bidding aggression as key factors to watch.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Time of India
3 hours ago
- Time of India
Vikram Solar's ₹2,079-cr IPO to open on Aug 19; fixes price at ₹315-332
New Delhi: Solar module maker Vikram Solar on Wednesday fixed a price band of ₹315 to ₹332 per share for its upcoming ₹2,079 crore initial public offering (IPO). The Kolkata-based firm's maiden public issue would open for subscription on August 19 and conclude on August 21, it announced. The IPO will include fresh issues of equities worth up to ₹1,500 crore and an offer for sale (OFS) of over 1.74 crore shares valued at around ₹579.37 crore at the upper end of the price band, by its promoters. This aggregates the issue size to ₹2,079.37 crore. Of the fresh issuance, the company plans to use the proceeds for funding capital expenditure for investment in its wholly owned subsidiary, VSL Green Power Private Ltd, for both Phase I and Phase II of the project. Vikram Solar commenced its manufacturing operations in 2009 with an installed solar PV module manufacturing capacity of 12 MW, grown to 4.50 GW installed capacity as of the date. According to a CRISIL report, the company holds one of the largest capacities among non-captive manufacturers on the Ministry of New & Renewable Energy's approved list of module manufacturers, with 2.85 GW listed as of June 2025. Vikram Solar has two solar PV module manufacturing facilities located in West Bengal and Tamil Nadu, and a solar cell manufacturing facility with two units, in Gangaikondan, Tamil Nadu. It has established a pan-India presence, serving 19 states and two union territories. The company's key domestic customers include prominent government entities, such as NTPC, Neyveli Lignite Corporation, and Gujarat Industries Power Company and large private independent power producers (IPPs), like ACME Cleantech Solutions Adani Green Energy, Azure Power India, JSW Energy and Rays Power Infra, among others. In terms of financials, Vikram Solar's revenue from operations increased by 36 per cent to ₹3,423 crore in fiscal 2025 from ₹2,511 crore in the preceding fiscal, similarly, profit after tax rose 75 per cent to ₹140 crore in fiscal 2025 from ₹80 crore in fiscal 2024. JM Financial, Nuvama Wealth Management, UBS Securities, Equirus Capital and PhillipCapital are book-running lead managers, while Link Intime India is the registrar for the IPO. PTI>
Economic Times
4 hours ago
- Economic Times
Headline inflation to average 3.5 pc this fiscal: Crisil
Crisil projects India's headline inflation to average 3.5 percent this fiscal year. This is down from 4.6 percent in the previous year. Healthy agricultural production should keep food prices stable. Subdued Brent crude oil prices will help control non-food inflation. Another repo rate cut is expected. Retail inflation has more than halved. This boosts household purchasing power. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Kolkata: Ratings firm Crisil said that headline inflation is expected to average 3.5 per cent this fiscal as compared to 4.6 per cent in the last financial its research report for August, the rating agency said that healthy agricultural production is likely to keep food inflation in kharif sowing is up a healthy four per cent year-on-year as of August 8."We expect headline inflation to average 3.5 per cent this fiscal from 4.6 per cent in the last," Crisil said in its research inflation is defined as a rise in prices of all items in the CPI, including food and geopolitical uncertainties remain under control, Brent crude oil prices are projected to be subdued at USD60 to USD65 per barrel in the current financial year, which should help contain non-food inflation, the report said another bout of repo cut is expected this fiscal. A cumulative cut of 100 basis points so far, along with adequate liquidity, has ensured a swift transmission down the retail inflation rate has more than halved over the past year, slipping even below the lower end of the Reserve Bank of India 's tolerance band of two per cent. It slid to 1.6 per cent in July from 2.1 per cent in sharp fall in retail inflation should buoy household purchasing power, particularly in the lower-income segments. This will create room for further monetary policy easing, the report added.
&w=3840&q=100)
Business Standard
5 hours ago
- Business Standard
India's headline inflation likely to average 3.5% in FY26: Crisil
Ratings firm Crisil said that headline inflation is expected to average 3.5 per cent this fiscal as compared to 4.6 per cent in the last financial year. In its research report for August, the rating agency said that healthy agricultural production is likely to keep food inflation in check. The kharif sowing is up a healthy four per cent year-on-year as of August 8. "We expect headline inflation to average 3.5 per cent this fiscal from 4.6 per cent in the last," Crisil said in its research report. Headline inflation is defined as a rise in prices of all items in the CPI, including food and energy. Assuming geopolitical uncertainties remain under control, Brent crude oil prices are projected to be subdued at USD60 to USD65 per barrel in the current financial year, which should help contain non-food inflation, the report said. Crisil said another bout of repo cut is expected this fiscal. A cumulative cut of 100 basis points so far, along with adequate liquidity, has ensured a swift transmission down the line. India's retail inflation rate has more than halved over the past year, slipping even below the lower end of the Reserve Bank of India's tolerance band of two per cent. It slid to 1.6 per cent in July from 2.1 per cent in June. The sharp fall in retail inflation should buoy household purchasing power, particularly in the lower-income segments. This will create room for further monetary policy easing, the report added. (Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
