4.30 Minutes onwards, interesting fact about industry demand, he was mentioned
Total demand 450000 MVA
and Current capacity ~ 37-380000 MVA so still in the short supply 70-80000 MVA (almost 18-20%)
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TARIL | Management Interview
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Q4 is in the direction as what management has guided
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Company is confident of achieving revenue lines that they have projected/committed to the markets
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Upcoming orders has better margins, where sustainable margins will hover around 17-18%.
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By next financial year, company is targeting 70,000 MVA
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Net Profit margins should increase by 10%+ by next financial year
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No such supplies from foreign soil and this demand-supply gap will continue
In India,
Current Capacity: 3.5L MVA level
Demand in India: 4.5L- 4.6L MVA, which will increase 7L MVA by FY29
Watch Management Interview
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Transformers and Rectifiers (India) Limited has secured following Domestic and Export Orders amounting to ₹350 cr
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Transformers and Rectifiers (India) Limited has secured Orders amounting to ₹726 Crore from Gujarat Energy Transmission Corporation Limited
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Net Profit margins should increase to 10%+ by next financial year. It will not increase by 10%
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TARIL | Management Guidance
- Company is targeting new 8,000 cr order inflow in FY26
- Company is also targeting margins to touch 17% by FY27
- Current Orderbook of 3500 cr to be executed this year and the remaining orders in the 1st quarter of the next year
- Major orderbook → Powergrid and NTPC and company is targeting other EPC contractors
- Company will improve margin by operational efficiencies, also by doing backward integration on current setup and not price hikes.
- Company is targeting to fulfill the requirements of India first and then exports, focus will not be not more than 10% w/o compromising on margins
- Current orderbook is at 5200 cr, and company will do similar orderbook of 5200-5300 cr in next 15 days as well
- Company expansion plans will be complete and will be operational by April 2025 with operational capacity of 15,000 MVA and another 22,000 MVA by January next year, so total capacity will be 65,000-70,000 MVA by Jan 2026 incurring costs of INR 500 cr
- 750 cr QIP only for enabling resolution, no immediate need of that fund
Watch the interview here
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Transformers and Rectifiers targets ₹8,000 crore order inflow by end of FY27 Transformers and Rectifiers targets ₹8,000 crore order inflow by end of FY27 - CNBC TV18
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So, the street is finally noticing this counter, and now we have brokerages throwing targets around—giving me a little more confidence (or at least some emotional support).
Regarding competition and margins, eventhough there is a consistent capacity addition i feel at higher kV 400+, TARIL stands tall ? capacity being planned 70k MVA even more than BHEL’s existing 40k MVA..can it be “benefit of economies of scale” ?
Then there’s the mega shift in energy transition (translation: we need way more transformers). Add to that India’s growing power hunger
— some comparison of per capita power consumption thousand units/year. (Iceland: 50, Norway: ~25, USA: ~12, Russia: ~7, Germany: ~6, UK: ~4, Turkey: ~3, China: ~5, Thailand: ~2, Indonesia: ~1, India: ~1)
Looking at this, I’d say margins have a VIP pass for at least the next 2-3 years—until capacity catches up (cue the 4X rule, where demand gets so crazy that one day we wake up to 4X capacity). The real question is: how long till that tipping point?
But, I’d rather hear about ground realities than sugar-coated management optimism. Sometimes the future feels too rosy, like staring at money through foggy glasses… and maybe that’s just my portfolio talking.
If anyone wants to dig in, I’ve tried summarizing recent interviews and numbers below. Let’s hear your take!
Orders & Revenue
- Order book: ₹3,200 crore (FY24) → ₹5,200 crore (FY25) → ₹8,000 crore (FY26 target)
- Revenue: ₹2,000 crore (FY25) → ₹3,500 crore (FY26) → ₹6,000-7,000 crore (FY29)
- Execution: ₹3,500 crore worth of orders planned for FY26, some spilling into Q1 FY27
Margins
- EBITDA Margins: 14-14.5% (FY25) → 15-16% (FY26) → 17% (FY27) → 17-18% (FY29)
- Net Margins: Expected to exceed 10% post-FY27
- Efficiency Play: Focus on operational efficiencies & backward integration, avoiding reliance on price hikes
Capacity
- Capacity: 37,200 MVA (Current) → 65,000-70,000 MVA (Q3 FY26)
- New Additions: 15,000 MVA (April 2025) + 22,000 MVA (Jan 2026)
- Investment: ₹500 crore capex over two years
- Key Competitors: CG Power, Hitachi Energy, Siemens, GE T&D, BHEL
Market
- Industry Tailwinds: ₹4.8 lakh crore capex in transmission (FY23-27), railway electrification, data center growth
- Demand-Supply Gap: 70,000-80,000 MVA shortage in FY25; expected to persist till FY29
- Risks: Rising industry capacity post-FY27 could impact margins if demand slows
- Stock Valuation: High PE (~86), execution must be flawless to justify premium
Future
- Solar & Hydrogen Play: 8,000 MVA allocation for solar/hydrogen by FY26-FY27
- Inorganic Growth: ₹750 crore QIP provision for potential acquisitions (CRGO steel, bushings)
- Exports: Capped at 10% till FY27, may rise to 15-20% post-FY27
Long-term : ₹15,000 crore+ order book & full capacity utilization (~70,000 MVA) by FY29
9 Likes
I think the results are on expected line > https://www.bseindia.com/xml-data/corpfiling/AttachLive/72d122a8-cdb5-40df-9ab3-8a2b0196ed42.pdf
Wht i like is the increasing order flow and enquiries.
Below the chairman comments which i found interesting..as such all men from chair would say interesting things only..
- 1st Phase of new capacity addition of 15,000 MVA will start for commercial production from May 25.
- will expand its Extra High Voltage (EHV) xformer capacity by an additional 22,000 MVA.
- Production from the expanded capacity to begin in Fe.26.With this addition, the total production capacity will exceed 75,000 MVA.
- New Capex infusion of ₹550 Crores in next 15 months of time. Implementation of 4 new backward integration facilities started
I’d like to think tailwinds to continue and should do good going forward, till the competition capacities catch up at EHV segment.
D - Holding
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EPS :
• Q4: ₹3.17
• FY25: ₹7.21 (vs ₹1.64 last year) — massive improvement!
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TARIL outlook from concall was we are confident of 3500 crores Rev in FY26 with current Orderbook of 5200 odd crores and next year probable 8000 crores Order book
Margins will be maintained/sustained as per 1st question ask by Bharat Shah
Exports also hardly 15 odd percent and they are choosy in picking profitable orders due to demand
If FY26 Rev aspirations are met then its close to PEG ratio of 1 and somewhat similar to FY28 Revenue growth rate (CEA projections till FY30 mentioned in concall alluded that this seems quite possible)
HVDC they need to crack Maintenance/Repair order(as per Make in India push) before they get a new One against Leaders
I am optimist on this one considering current Geopoliticial situation as Tariff doesn’t seem to affect them much and not too much Export dependency and Power being a critical Energy Security for countries
Disc : Invested since last 6 months
7 Likes
TARIL Concall: Regarding the impact of reciprocal tariffs, when asked about potential effects on their export market and margins due to reciprocal tariffs in the US, the company stated that there is no reciprocal tariff impacting them as their products are exempted from tariffs.
So Transformer exempted??
Any view please.
1 Like
Transformers and Rectifiers India | Management Interview
- Gave its guidance of Rs 3,500 crore in revenue for FY26 after a strong FY25.
- Expects EBITDA margin to sustain at 16-17%.
- Company says that orderbook will grow to Rs 8,000 crore by the end of FY26.
Watch
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Q4FY25 Concall Notes
Management Tone: Very bullish and confident
Management
- FY26 focus remains consolidation, global expansion, sustainable profitability and margin expansion through backward integration.
- No slowdown in govt capex in power and energy sector.
- Target to become a US 1 Billion $ revenue company with 10% PAT margins (at least) in the next 3 years remains intact with sustained demand both from domestic and export markets.
- Expect to achieve sales of 3500cr in FY26. 16-17% margins sustainable in 2026. Margins in Q4 jumped due to specific high margin orders for EHV transformers. Co does not want to increase margins by increasing realisations (probably peak) but do it through better operational efficiency.
Business
- Landmark year for co. Highest ever production in cos history with manufacturing at 28882 MVA in FY25 vs 16425 MVA in FY24. Co operating at 60-65% utilisation. Will reach 80% utilisation in FY26.
- Total order inflow in FY24 at 4504cr. Unexecuted order book of 5132cr providing revenue visibility for the next 15-18 months. Order pipeline at 22,000cr (possible to win 25-30%). Company expects an orderbook of 8000cr in FY26. In the current orderbook, around 45% is the utility business and about 55% is the EPC and other businesses. 70% of the product is in the 220kv+ segment.
- Exports make up 15% of the current orderbook and with the goal to maintain this number going forward as opportunities are very high in India with better margin and payment terms. FY 26 exports will be around 10%. As per the company, there is no impact of reciprocal tariffs as the company is exempted from these tariffs.
- Significant milestone- securing supply of a single order of 740 cr from GETCO in March 2025, largest in both the cos and GETCO’s history.
- Growth in Grid expansion is moving fast. As per the CEA, in next 6 years, 381 transformers are required in Grid expansion (220 kv+ segment) and around 193 reactors required. At present, there is not even 50% capacity of that in India.
- Successfully raised 500 cr via QIP (in 3 weeks) which will be deployed for backward integration and enhancing manufacturing capacity.
- Q4FY25 saw successful completion of dynamic short circuit testing of a 500 MVA 400 kv transformer. Also completed dynamic testing of 8.8 MVA IDT. PGCIL approval process formally initiated during the Q.
- Currently co has the capability to manufacture transformers upto 1200 kv. Now, co is targeting to get into the HVDC segment.
- Currently there are no orders in this segment with co but the co has been promised trial order for repair work for HVDC transformers (huge failure of HVDC transformers in the grid). Co is working on developing indigenous tech (make in India) and will not do any tech transfers. Margins in this segment will be similar to current consol margins (16-18%).
- Market for special transformers is growing very fast mainly due to the pickup of green hydrogen and ammonia. Co has been getting enquiry for these rectifier transformers from all over the world. As far as India is concerned, co is the major supplier of these transformers for these furnaces.
- First Phase (½) of new capacity addition of 15,000 MVA will start for commercial production from May 2025. The company will expand its Extra High Voltage (EHV) transformer capacity by an additional 22,000 MVA which will be completed by Feb 2026. These projects will take the total manufacturing capacity of the company to 75,000 MVA.
- Co will be spending 550cr in the next 15 months on this Capex+ Backward integration with FY26 capex at 400 crs (40:60).
- Co also tested a record no. of transformers in Dec 2024 both in terms of MVA and units.
- During Q4, co entered into a tech tie up to accelerate the backward integration journey, strengthening the cos supply chain resilience. Successfully acquired controlling stake in a CRGO processing unit (Posco), achieving 100% backward integration in CRGO (30-35% cost input of a transformer). Co is also going to backward integrate CRGO for reactor coils (only 2 players currently doing this). Co has done long term tie up with mills for CRGO steel supply who will supply on monthly basis.
- Implementation of 4 new backward integration facilities started. Target to be a 100% backward integrated organization by Q1 FY 2627. This will help the co a lot in reducing inspection lead time as the inspector will need to visit only 1 place.
- Debt to equity at 0.2 vs 0.84 yoy. Working towards becoming a net debt free co in the next 1-2 years.
- Non current trade receivables increased significantly in FY25 due to retention money which will be realised in 6-12 months.
- Debtors at 114 days vs 156 days last year. Company working towards achieving a working capital of 120 days with a further target to reduce it to 100 days as a sustainable no.
13 Likes
| FV | 1 | Equity | 30 | |||
|---|---|---|---|---|---|---|
| Price | 496 | 496 | 496 | 496 | ||
| Sales Growth | 56% | 2,019 | 3,148 | 4,908 | 7,651 | 279% |
| EBITDA margin | 16% | 327 | 380 | 442 | 513 | 57% |
| NP Margin | 11% | 216 | 239 | 265 | 293 | 36% |
| EPS | 7.14 | 8 | 9 | 10 | 50.78 | |
| against EPS growth of 36% in FY 29 quoting at 50.78 |
Can you please make this table more legible to read
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