The Indian transformer market is expected to grow at a compound annual growth rate (CAGR) of 4.7 percent between 2024 and 2030, reaching $57.8 billion. One of the primary drivers of the power transformer market is the global increase in power demand.
The Central Electricity Authority projects that capital expenditure (capex) in the power transmission sector alone could reach approximately Rs. 4.75 trillion by 2027, indicating substantial investment in upgrading and expanding the grid infrastructure.
Here is a detailed information on the two transformer stocks that have announced their upcoming expansion plans:
Voltamp Transformers Limited
With a market capitalisation of Rs. 9,353.8 crores, the shares of the leading manufacturer of energy-efficient and customised industrial application transformers surged nearly 1.7 percent on BSE to Rs. 9,890.05 on Thursday.
In order to cater to the rising demand for electricity and transformers projected over the next 5-6 years, Voltamp’s board approved fresh capex of up to Rs. 200 crores to build a new power transformer manufacturing unit (up to 250 MVA and 220 KV rating).
Voltamp Transformers has signed a land purchase agreement and acquired a suitable land parcel for the new facility near Jarod village on Vadodara and construction activities are expected to commence shortly.
The first phase of the expansion will add 6,000 MVA of capacity, bringing the company’s total capacity to 20,000 MVA. The new plant is projected to be operational by Q1 FY27, subject to unforeseen circumstances.
As of 1st April, Voltamp’s opening order book stood at Rs. 840.66 crores (7839 MVA), with new orders totalling Rs. 1,008.73 crores (8014 MVA) secured since April 2024. The current unexecuted orders in hand amount to Rs. 1,022.01 crores (8730 MVA).
Looking ahead, the company anticipates a stable business outlook in the near term, driven by steady domestic demand and ongoing government support for green energy and infrastructure projects.
In Q2 FY25, the company witnessed a marginal growth in its revenue from operations, reaching Rs. 398 crores, a rise of around 4.5 percent YoY, accompanied by net profit growth of nearly 12 percent YoY to Rs. 76 crores.
Over the last one year, Voltamp Transformers has delivered positive returns of about 76.3 percent, as well as 38 percent year-to-date.
Incorporated in 1967, Voltamp Transformers Limited is engaged in the business of design, manufacture, and supply of various kinds if transformers, with a strong presence across all industry segments including power, steel, cement, oil & gas, chemical and petrochemical, data centres, green energy.
Transformers & Rectifiers (India) Limited
With a market capitalisation of Rs. 13,050.5 crores, the shares of a leading player in the manufacturing of transformers & reactors in India moved up by 0.22 percent on BSE to Rs. 889 on Thursday.
The first phase of the new capacity addition of 15,000 MVA is set to begin commercial production from January 2025. Additionally, the trial run for the fully automated radiator manufacturing facility, capable of producing up to 765 kV, has already begun, while the first phase of the fabrication unit is set to become operational by March 2025.
The company aims to achieve 100% backward integration by the first quarter of FY26, while discussions for both organic and inorganic growth opportunities are at an advanced stage.
The revenue target for the current financial year remains on track, with the goal of reaching US$ 1 billion in revenue over the next three fiscal years already underway.
As of September 30th, the company’s unexecuted order book was valued at Rs. 3,500 crores, all of which is expected to be fulfilled within the next 18 months. New order inflows have amounted to Rs. 1,031 crores.
In addition, the company successfully raised Rs. 500 crores through a Qualified Institutional Placement (QIP) in June 2024.
During Q2 FY25, Transformers & Rectifiers secured an order for a 420kV three-phase reactor with synthetic organic ester insulating fluid from Power Grid, as well as a 175 MVA EAF transformer order from ArcelorMittal Mexico.
In Q2 FY25, the company witnessed a significant growth in its revenue from operations, reaching Rs. 461.5 crores, a rise of around 80 percent YoY, accompanied by impressive net profit growth of nearly 2296 percent YoY to Rs. 46 crores.
Over the last one year, the stock has delivered multibagger returns of about 347.6 percent, and has gained nearly 364.3 percent year-to-date.
Transformers and Rectifiers (India) Limited is engaged in the manufacturing of power, furnace and rectifier transformers.
Written by Shivani Singh
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. Dailyraven Technologies 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.
