Transformers & Rectifiers India Ltd (TRIL) shares hit the lower circuit limit on Monday, falling 10% to Rs 282.20 following the release of disappointing quarterly results. The stock has been on a downward trajectory for eight consecutive sessions, shedding nearly 40% of its value during this period.

Q2 Financial Performance

The company's financial results for the quarter ended September 30 revealed a significant decline in profitability:

The company's EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) margins contracted by 330 basis points year-over-year, indicating pressure on operational efficiency.

Order Book and Future Outlook

Despite the weak quarterly performance, TRIL maintains a robust order book:

• Current order book: Rs 5,472 crore
• Inquiries under negotiation: Over Rs 18,700 crore
• Q2 order inflow: Rs 592 crore

These figures suggest potential for future revenue growth, provided the company can effectively execute its projects and improve profitability.

Stock Performance

The recent financial results have exacerbated the downward pressure on TRIL's stock:

• Year-to-date decline: Over 50%
• Six-month decline: About 36%

Recent Developments

According to the latest LODR data, TRIL secured a new order worth Rs 103.45 crore from Gujarat Energy Transmission Corporation Limited for the supply of 54 various types of transformers. This order is expected to be executed by the next financial year and may provide some support to the company's future revenue stream.

Additionally, the company disclosed receiving a Notice of Uncontested Sanctions Proceedings from the World Bank related to a past project in Nigeria. While TRIL states that this debarment is limited to World Bank-funded projects and does not materially impact its current operations, investors should monitor any potential reputational effects or future business implications.

As TRIL navigates through these challenges, investors will be closely watching for signs of operational improvement and the company's ability to leverage its strong order book to reverse the recent financial and stock performance trends.

Transformers & Rectifiers (India) Limited (TARIL), a leading transformer manufacturer, has recently received a Notice of Uncontested Sanctions Proceedings from the World Bank. This development relates to alleged irregularities in a past supply order for the Nigeria Electricity Transmission Project. Despite this setback, the company maintains that its overall business operations remain unaffected and projects strong financial performance.

Key Details of the World Bank Notice

• Case Number: Sanctions Case No. 788
• Project: Nigeria Electricity Transmission Project (IDA Credit Nos. 6185-NG and 6186-NG)
• Notice Date: November 4, 2025
• Previous Notice: July 30, 2025 (reportedly not received by TARIL)

Order Details and Timeline

Company's Response and Impact

TARIL has stated its intention to contest the matter and will submit a reply to the World Bank. The company emphasizes that:

1. The debarment is limited to participation in World Bank-funded projects only.
2. TARIL currently has no ongoing or pending orders under such projects.
3. The company believes this action has no material impact on its business operations, financial performance, or future outlook.

Recent Business Developments

1. TARIL has secured a new order worth Rs. 103.45 Crore from Gujarat Energy Transmission Corporation Limited. This order involves the manufacturing of 54 various types of transformers, to be delivered by the next financial year.

2. The company anticipates revenue of approximately Rs. 2,600.00 crore with an EBITDA margin of around 16%.

3. TARIL expects strong order inflow, supported by a pipeline exceeding Rs. 8,000.00 crore.

Company's Stance

TARIL maintains that it has acted in good faith and in compliance with all applicable laws and contractual obligations. The company plans to:

1. Represent its case to the World Bank
2. Prove it is not involved in any illegal or restricted transactions
3. Satisfy the World Bank's requirements to potentially lift the debarment

Conclusion

While facing challenges with the World Bank debarment, Transformers & Rectifiers (India) Limited continues to secure domestic orders and maintain its position as the second-largest transformer manufacturing company in India based on capacity. The company's management remains committed to addressing the World Bank's concerns while focusing on its core business operations and growth. With strong financial projections and a robust order pipeline, TARIL appears poised for continued growth despite the current challenges.