The shares of Smallcap stock specializing in the manufacturing of transformers and power equipment hit a 5 percent upper circuit following Revenue guidance of Rs. 3,500 Crores by FY26.
Price action
With a market capitalization of Rs. 12,161.22 Crores on Thursday, the shares of Transformers & Rectifiers India Limited hit a 5 percent upper circuit making a high of Rs. 405.15 compared to its previous closing price of Rs. 385.90.
About the Company
Transformers and Rectifiers Limited (TARIL) plays a key role in the power sector by providing reliable solutions for power transmission and distribution. The company manufactures a wide range of products, including transformers, reactors, and related equipment, designed to meet the demands of high-voltage systems, ranging from low to ultra-high voltage applications.
Guidance of Transformers and Rectifiers Limited
According to the company’s recent conference call update, they are targeting a revenue guidance of Rs. 3,500 crores or more by FY26 and aim to reach a long-term goal of a USD 1 billion revenue in the next 3-4 financial years. The company’s unexecuted order book stands at Rs. 3,600 crores as of December 31, 2024, and they have order inquiries worth Rs. 19,000 crores under negotiation or in the bidding stage.
The company has plans for capacity expansion and stated that they won’t be raising any funds at this time. Furthermore, the company plans to export radiators, but before doing so, they want to ensure that the quality meets the requirements of foreign customers.
Product-wise Orderbook segment
As of the end of Q3FY25, the unexecuted order book stands at Rs. 3,686 crores, with power transformers accounting for Rs. 2,431.68 crores (66 percent), reactors for Rs. 994.22 crores (27 percent), and special duty transformers for Rs. 257.02 crores (7 percent).
Capacity Expansion
The company’s capacity expansion project of 15,000 MVA is progressing as planned and is expected to be operational by February-March 2025. Order bookings for the new capacity will begin in Q1 FY26. For FY25, with a long-term goal of reaching $1 billion in the next 3-4 years. This expansion will support future growth and strengthen the company’s market position.
Strategic Developments:
The company has acquired a controlling stake in the CRGO processing unit, achieving full backward integration, which will help reduce raw material costs by around 4 percent. It has also entered into three technological partnerships to improve capabilities and enhance supply chain efficiency, which is expected to be operational by Q4 FY26.
Additionally, the company has started the approval process with PGCIL for a fully automated dilator facility and completed a 500 MVA short-circuit test.
Financials
Transformers and Rectifiers India Limited’s revenue has increased from Rs. 369 crore in Q3 FY24 to Rs. 559 crore in Q3 FY25, which has grown by 51.49 percent. The net profit has also grown by 243.75 percent from Rs. 16 crore in Q3 FY24 to Rs. 55 crore in Q3 FY25.
Written by Sridhar J
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