Synopsis: GE Power India is strengthening its refurbishment and repair business through a long-term manufacturing partnership, dedicated facility expansion, and fresh investments aimed at improving execution capabilities and future service opportunities.
The shares of this small cap company majorly engaged in engineering, procurement & construction (EPC) of key equipment for thermal and hydro power plants, hit upper circuit after the company signed a multi-year manufacturing pact
With the market capitalization of Rs. 4684 Crores, the shares of GE Power India Ltd hit upper circuit of 5 percent to Rs. 697.5 per share from its previous day close of Rs. 664.35 per share and is trading at a P/E of 13.4 where as industry P/E stands at 40.6
Leave & License Agreement: Building a Dedicated Operational Base
Under the Leave & License Agreement, GE Power India has granted Quality Profiles Private Limited (QPPL) the right to use specified land, shed space and related infrastructure at its Vadodara facility for setting up a dedicated refurbishment and manufacturing unit. The agreement has been structured for a period of 60 months with a 48-month lock-in period, reflecting a long-term strategic commitment from both sides.
To support the establishment of the facility, the initial 53 weeks have been kept free from license fees, giving QPPL sufficient time to install machinery and complete operational setup activities. Along with this, QPPL will pay license fees and common area maintenance charges to GE Power India once operations commence. The arrangement is expected to create a focused infrastructure base dedicated to servicing refurbishment and restoration requirements for large rotating equipment used in the power sector.
Contract Manufacturing Agreement: Strengthening Refurbishment Capabilities
Through the Contract Manufacturing Agreement, GE Power India has partnered with QPPL for refurbishment, repair and manufacturing activities related to steam turbine and generator components such as rotors, stators, valve chests, valve internals, bearings and pedestals. As part of the agreement, GE Power India will invest nearly Rs. 18 crore towards civil infrastructure and plant additions, while QPPL will invest around Rs. 25 crore in machinery procurement and installation at the facility.
The agreement also provides business visibility, with GE Power India committing a minimum annual order value of Rs. 10 crore to QPPL, which will increase by 7 percent every year. Importantly, QPPL will manufacture products exclusively for GE Power India under this arrangement, ensuring dedicated capacity for the company’s refurbishment requirements. The partnership is aimed at improving execution efficiency, strengthening service capabilities and supporting the growing demand for repair and restoration work in the power equipment segment.
About the company and financials
GE Power India Limited is engaged in the engineering, manufacturing, servicing and supply of products and solutions for the power generation industry. The company primarily focuses on steam power, power plant equipment, refurbishment services and maintenance solutions for utilities and industrial customers. Backed by the global expertise of GE Vernova, GE Power India supports thermal power projects, lifecycle management and modernization services across India’s energy sector while also expanding its aftermarket and repair capabilities.
Year on Year analysis: Revenue from operations has increased from Rs. 266 Crores to Rs. 316 Crores, up 18 percent. Operating loss has turned into a profit of Rs. 107 Crores from loss of Rs. 21 Crores. Net profit has decreased from Rs. 164 Crores to Rs. 113 Crores, down 31 percent
Quarter on Quarter analysis: Revenue from operations has decreased from Rs. 386 Crores to Rs. 316 Crores, down 18 percent. Operating profit has decreased from Rs. 125 Crores to Rs. 107 Crores, down 14 percent and net profit has increased from Rs. 72 Crores to Rs. 113 Crores, up 57 percent
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