CG Power Q2 Results: Revenue: ₹2,413 crore, up by 21% YoY

CG Power and Industrial Solutions Ltd. announced its Q2 results on Monday for the quarter ended September 30, 2024. The company reported its consolidated profit after tax of ₹220 crore, down by 9.8% from ₹244 crore in the previous year. The company’s revenue surged to approximately ₹2,413 crore, reflecting a 21% year-on-year growth. Despite strong revenue growth, the company reported a decline in net profit and EBITDA margins. Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) decreased by 4.6% year-on-year, reaching ₹294.7 crore.

Quick Highlights:

• Revenue: ₹2,413 crore, up by 21% YoY.
• Net Profit: ₹220 crore, decreased by 9.8% from the previous year.
• Management’s Take: Strong growth driven by increase in order intake in Q2. Outlook remains positive.
• Stock Reaction: Shares fell around 6% on Monday after the quarterly results announcement. 

Management Commentary:

The board has sanctioned the raising of ₹3,500 crore through a Qualified Institutional Placement (QIP), which is pending approval from shareholders and relevant regulatory bodies.

The company highlighted 42% growth in order intake reaching ₹3,302 crore, while the unfulfilled order backlog amounted to ₹7,965 crore, reflecting a year-on-year growth of 48% as of September 30, 2024. Despite challenges in profit margins, CG Power remains optimistic about future growth prospects. 

Stock Market Reaction:

The quarterly result was announced on Monday, during trading hours. Post the announcement of the Q2 results, CG Power's shares saw a decline of around 6% and closed at ₹775.60. On Tuesday, the share price further declined, closing at ₹757. This drop reflects a reaction from investors.

About CG Power and Industrial Solutions

CG Powers and Industrial Solutions is an Indian multinational company into manufacturing, design, and marketing of products related to power generation, transmission and distribution. 

The company plans to enhance the manufacturing capacity of its Power Transformer Units at the Mandideep Plant in Bhopal from 35,000 MVA to 40,000 MVA at its T3 unit. Notably, the board had previously approved an increase in manufacturing capacity from 25,000 MVA to 35,000 MVA in October of the previous year.

This capacity expansion will require a total investment of ₹26.64 crore, which will be financed through internal accruals. The expansion is expected to be completed within 18 months and is being undertaken in anticipation of a rising demand for transformers.