GE Vernova T&D India Limited, a leading player in the power transmission and distribution sector, has reported stellar financial results for the first quarter, showcasing strong growth across key metrics.

Revenue Surge and Order Book Growth

The company's revenue for Q1 stood at INR 13.30 billion, marking a substantial 39% year-on-year increase from INR 9.60 billion in the same quarter last year. This growth was complemented by a robust order inflow of INR 16.20 billion, up 57% from INR 10.30 billion in the corresponding quarter last year. The strong order intake has further bolstered the company's order backlog, which now stands at INR 129.60 billion, providing a solid foundation for future growth.

Impressive Profitability and Margin Expansion

GE Vernova T&D India demonstrated remarkable improvement in profitability. The company's EBITDA margin expanded significantly by 1000 basis points to reach 29.1% for the quarter. Profit before tax and exceptional items more than doubled to INR 3.90 billion from INR 1.80 billion in the same quarter last year, reflecting the company's operational efficiency and strong execution capabilities.

Export Performance and Cash Position

Exports continued to play a crucial role in the company's performance, contributing 39% of the quarterly revenue. This diversification has not only boosted top-line growth but also positively impacted margins. The company's financial position remained strong, with positive cash flow generation of INR 1.70 billion during the quarter. Cash and cash equivalents increased to INR 12.20 billion from INR 10.50 billion as of March, providing ample liquidity for future investments and operations.

Strategic Focus and Future Outlook

Sandeep Zanzaria, CEO and MD of GE Vernova T&D India, commented on the results, stating, "We had a productive strong quarter of robust demand, significant revenue growth and EBITDA margin expansion. Our order book remains strong, and we are uniquely positioned to power India's electrified future."

The company maintains a positive outlook on upcoming opportunities, particularly in the HVDC segment. Management expects both the South Olpad-Khavda and Barmer-South Kalamb HVDC projects to be finalized during the current financial year, potentially adding significant value to the order book.

Capital Allocation and Shareholder Returns

In line with its commitment to shareholder value creation, GE Vernova T&D India has announced a capex plan of INR 2.50 billion to enhance its manufacturing capabilities. Additionally, the company has proposed a dividend of INR 1.30 billion, subject to shareholder approval, demonstrating its focus on balancing growth investments with returns to shareholders.

Conclusion

GE Vernova T&D India's Q1 results reflect the company's strong market position, operational excellence, and ability to capitalize on the growing demand in the power transmission and distribution sector. With a robust order backlog, improving profitability, and strategic investments in capacity expansion, the company appears well-positioned to sustain its growth trajectory in the coming quarters.

As GE Vernova T&D India continues to navigate the evolving energy landscape, its focus on operational efficiency, export growth, and strategic project execution positions it as a key player in India's power infrastructure development.

GE Vernova T&D India Limited has reported robust financial results for the first quarter, while simultaneously cautioning stakeholders about future margin expectations.

Strong Q1 Performance

The company announced impressive year-on-year growth in its Q1 results:

Caution on Future Margins

Despite the strong Q1 performance, GE Vernova T&D has warned stakeholders not to consider the high Q1 margins as a new standard for future performance. This cautionary stance suggests that the company expects performance to normalize in the coming quarters.

Long-Term Margin Target

While tempering short-term expectations, the company has set a longer-term goal for margin improvement. GE Vernova T&D is targeting a 19% EBITDA margin by FY25, indicating a strategic focus on sustainable profitability growth.

Key Wins and Operational Highlights

The company secured several significant orders in Q1, including:

• Multiple orders for 765 kV transformers and reactors in Rajasthan and Gujarat
• An order for 420 kV GIS from Bharat Heavy Electricals Ltd in Madhya Pradesh
• An order for 420/245 kV GIS from a private EPC player in Maharashtra
• Multiple orders for 765 kV AIS equipment and grid automation packages
• Export orders for AIS/GIS equipment to Europe, South-East Asia, Middle East, and Africa

Operationally, GE Vernova T&D successfully commissioned several projects, including:

• 765 kV AIS and 400 kV GIS bay for PGCIL in Kotra
• 765 kV GIS bays and 1500 MVA ICT for Adani at Khavda
• Approximately 2,700 MVA capacity across various sites in India

Management Commentary

Sandeep Zanzaria, Managing Director & CEO of GE Vernova T&D India Limited, commented on the results: "We delivered a strong and productive first quarter, driven by continued momentum as India modernizes its grid to improve reliability, accommodate renewable energy sources, and meet increasing electricity demands from various sectors. We have been disciplined in taking profitable orders with better margins and expect to continue on this trajectory."

The company's focus on profitable growth and cash flow generation is evident in Zanzaria's statement: "To ensure we maximize long-term shareholder value, the company consolidated its position on free cash flow."

As GE Vernova T&D India continues to navigate the dynamic energy sector, investors and stakeholders will be closely watching how the company balances its strong current performance with its cautious outlook on future margins.