Synopsis: CG Power & Industrial Solutions shares traded firm after the company reported a strong Q2FY26 performance, marked by a 29 percent year-on-year rise in net profit to Rs. 284 crore. The order backlog climbed 88 percent to Rs. 14,953 crore, while the company unveiled its first semiconductor OSAT facility in Gujarat.
A semiconductor and power solutions stock remained in focus after the company announced its September quarter results showcasing steady growth in profitability and a robust order pipeline. The market sentiment turned positive, driven by healthy operational performance and visibility in upcoming projects.
CG Power & Industrial Solutions Ltd, with a market capitalisation of Rs. 1,15,663.17 crore, opened at Rs. 757.80 against the previous close of Rs. 748.70 and touched an intraday high of Rs. 757.80, marking a gain of 1.21 percent.
What’s the News?
The company announced its Q2FY26 results, reporting steady operational performance with margin stability and healthy profitability.
On a quarter-on-quarter basis, sales increased from Rs. 2,878 crore to Rs. 2,923 crore, a rise of 1.6 percent, while operating profit slightly dipped from Rs. 381 crore to Rs. 377 crore, down 1 percent. The operating margin remained steady at 13 percent. Profit before tax improved from Rs. 364 crore to Rs. 388 crore, up 6.6 percent, and net profit rose from Rs. 267 crore to Rs. 284 crore, an increase of 6.4 percent. Earnings per share climbed from Rs. 1.76 to Rs. 1.82.
On a year-on-year basis, the company delivered a strong growth trajectory. Sales grew from Rs. 2,413 crore to Rs. 2,923 crore, up 21.1 percent, while operating profit increased from Rs. 295 crore to Rs. 377 crore, a 27.8 percent jump. The operating margin expanded from 12 percent to 13 percent. Profit before tax surged from Rs. 294 crore to Rs. 388 crore, rising 31.9 percent, and net profit improved from Rs. 220 crore to Rs. 284 crore, reflecting a 29.1 percent increase. EPS grew from Rs. 1.45 to Rs. 1.82.
The company’s margin improvement was driven by the strong performance of its Power Systems segment, partially offset by increased investment in talent acquisition for CG Semi and Axiro. ROCE for the quarter stood at a healthy 31 percent. Order intake for the quarter rose 45 percent year-on-year to Rs. 4,772 crore, while the unexecuted order backlog surged 88 percent year-on-year to a robust Rs. 14,953 crore, providing multi-quarter visibility.
Segment-wise Performance
In the Industrial Systems segment, aggregate sales for the quarter stood at Rs. 1,395 crore, down 2 percent year-on-year, primarily due to project deferments in the Railway segment. The segment faced margin pressure due to pricing challenges, deferred execution, and rising commodity costs, though these impacts were partly cushioned by pricing discipline and productivity improvements. The company continues to focus on margin recovery through cost optimisation and improved product mix. Order intake for the quarter was Rs. 1,567 crore, down 10 percent year-on-year, with a healthy backlog of Rs. 3,094 crore, up 15 percent year-on-year. After adjusting for a large Rs. 340 crore Railway order received last year, order intake reflects 13 percent year-on-year growth in Q2FY26.
In the Power Systems segment, aggregate sales rose sharply to Rs. 1,254 crore, marking a 48 percent year-on-year increase, supported by strong execution and demand momentum. Margins expanded by 310 basis points due to improved price realisation and operating leverage. Order intake for the quarter jumped to Rs. 2,643 crore, an 81 percent rise year-on-year, while the unexecuted order backlog reached Rs. 10,474 crore, up 104 percent year-on-year, ensuring sustained revenue visibility.
Key Events in Q2FY26
During the quarter, CG Semi Private Limited (“CG Semi”), a subsidiary of CG Power, inaugurated one of India’s first end-to-end Outsourced Semiconductor Assembly and Test (OSAT) facilities in Sanand, Gujarat, on August 28, 2025. With the launch of the G1 facility, CG Semi became one of India’s first full-service OSAT providers, offering advanced packaging technologies.
CG Semi is eligible for capital assistance under the India Semiconductor Mission (ISM) of the Ministry of Electronics and Information Technology (MeitY), with approval covering a five-year period from FY2024-25 to FY2028-29 for a total project cost of Rs. 7,584 crore. The assistance includes Rs. 3,501 crore from the Central Government and an additional Rs. 1,400 crore from the State Government.
Additionally, the Board of Directors approved a Greenfield expansion of the Switchgear business with an investment of Rs. 748 crore (net of taxes), aimed at meeting growing demand for MV/EHV circuit breakers, instrument transformers, and Gas Insulated Switchgear (GIS) in both domestic and export markets.
About the Company
CG Power and Industrial Solutions Limited is a diversified engineering company offering products and services across power systems, industrial systems, and semiconductors. Its Power Systems segment provides transformers, switchgears, circuit breakers, and turnkey substation projects, while the Industrial Systems division manufactures traction motors, AC generators, and automation solutions. The Semiconductors segment operates through its OSAT and RF businesses. The company serves sectors including steel, cement, oil & gas, automobiles, defense, data centers, renewables, and infrastructure.
-Manan Gangwar
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Trade Brains Technologies Private Limited or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
