CG Power Delivers Record FY26 Performance Driven by Power Systems, Export Momentum and Semiconductor Expansion; Announces Rs. 748 Crore Switchgear Expansion

CG Power Delivers Record FY26 Performance Driven by Power Systems, Export Momentum and Semiconductor Expansion; Announces Rs. 748 Crore Switchgear Expansion

- Transmission, Data Centres and Semiconductors Define CG Power’s Next Growth Phase
- With the commissioning of the G1 facility, CG Semi has emerged among the country's first full-service OSAT providers

The Electrical Post 

CG Power and Industrial Solutions Limited has reported its strongest standalone financial performance in recent years, underpinned by robust execution, sustained demand across power infrastructure segments, expanding export opportunities and strategic investments in semiconductors and switchgear manufacturing.

Addressing the Q4 FY26 earnings conference call, Managing Director and CEO Amar Kaul said FY26 marked a record year for the company, reflecting continued momentum driven by disciplined execution and strategic focus.

As a leading engineering conglomerate, CG Power has evolved from a trailblazing Indian enterprise into a global force. With 18 world-class manufacturing units and a workforce of over 7,000 skilled professionals, CG Power designs and deliver high-performance engineering solutions that thrive in the most demanding conditions globally.

“This is a record fiscal year performance for CG in recent times. A very strong Q4 caps off a record fiscal year with highest ever standalone revenue, order book and profit before tax after accounting for exceptional items,” Kaul stated.

The company reported a 22% year-on-year growth in Q4 FY26 sales, while profit before tax excluding exceptional items increased 43% with a margin expansion of 260 basis points. For the full year, sales grew 21% year-on-year, while PBT excluding exceptional items rose 34%, supported by a margin expansion of 143 basis points, making FY26 the strongest standalone fiscal performance in the company's history.

Order inflows remained robust throughout the year, supported by expansion into new and emerging sectors and markets. As a result, CG’s order backlog surged 59% year-on-year to Rs. 15,719 crore, providing strong revenue visibility for FY27.

For the fourth quarter, aggregate sales stood at Rs. 3,129 crore, up 22% over the previous year. Profit after tax increased 49% to Rs. 412 crore, representing 13.2% of sales compared with Rs. 275 crore or 10.7% of sales in Q4 FY25. Return on capital employed reached 27%, while quarterly order intake rose 23% to Rs. 4,505 crore.

From an industry perspective, the company's performance reflects continued strength in India's power equipment market, supported by ongoing transmission expansion, renewable integration, grid modernization initiatives and growing demand from industrial sectors.

Within the Industrial Systems segment, performance continued its upward trajectory despite commodity price volatility and cost pressures. Quarterly sales stood at Rs. 1,643 crore, registering 5% year-on-year growth, primarily driven by robust double-digit growth in motors.

Kaul highlighted that the motors business has witnessed significant stabilization over recent quarters, with operational improvements now translating into measurable business outcomes.

PBIT for the segment stood at Rs. 157 crore, representing 9.6% of sales, compared with Rs. 176 crore or 11.2% of sales in the corresponding period last year. Margin pressure stemmed from changes in business mix, competitive pricing in the railways segment and higher material costs impacting the motors business.

However, disciplined pricing strategies, productivity enhancement initiatives and cost optimisation programmes helped partially offset these pressures. The company also reported a sequential improvement of 20 basis points in margins, underscoring the effectiveness of its ongoing operational initiatives.

Industrial Systems recorded order intake of Rs. 1,478 crore during the quarter, while the unexecuted order backlog reached Rs. 3,075 crore by the end of FY26. Growth in motors and drives businesses contributed significantly to the healthy order pipeline.

For the full fiscal year, Industrial Systems sales reached Rs. 6,197 crore, reflecting 6% growth year-on-year, largely supported by motors. PBIT stood at Rs. 613 crore or 9.9% of sales, compared with Rs. 707 crore and 12.1% margins in the previous year. Competitive pricing in railways, product mix changes and deliberate moderation in certain international markets affected profitability, although management maintained its focus on long-term margin expansion through structural improvements, pricing discipline and portfolio optimisation.

The standout performer for CG during FY26 was the Power Systems segment, which continued to benefit from favourable market conditions and strong execution capabilities.
Quarterly sales in Power Systems jumped 50% year-on-year to Rs. 1,487 crore, reflecting strong project execution momentum. PBIT reached Rs. 354 crore, equivalent to 23.8% of sales, compared with Rs. 208 crore or 21% of sales in Q4 FY25. Margin expansion of 287 basis points was driven by efficient execution, operating leverage and favourable project mix.

Order inflows in the segment surged 72% year-on-year to Rs. 3,027 crore, while the unexecuted order backlog climbed 91% to Rs. 12,644 crore as of March 31, 2026, ensuring revenue visibility over multiple future quarters.

For the power sector, these figures reflect sustained investments in transmission infrastructure, expansion of renewable energy networks and strengthening grid reliability initiatives.

Among the key achievements during FY26 was the award of a major order from PowerGrid Corporation for supply and servicing of 765 kV transformer packages under the 7TR-12 Bulk programme. Valued at approximately Rs. 641 crore, the contract represents the largest single domestic transformer order received by CG and is scheduled for execution over 18 to 36 months.

The company also secured its largest order in the extra high voltage segment, valued at Rs. 244 crore, from Techno Electric for the supply of instrument transformers, circuit breakers and lightning arresters.

CG further strengthened its balance sheet through a successful Qualified Institutional Placement, raising Rs. 3,000 crore. The issue, which opened on June 30, 2025, and closed on July 3, 2025, was oversubscribed more than three times and attracted participation from leading domestic and global institutional investors.

A major strategic milestone for the company has been its entry into India's semiconductor manufacturing ecosystem.

CG Semi Private Limited, a subsidiary of CG, inaugurated one of India's first end-to-end Outsourced Semiconductor Assembly and Test (OSAT) facilities at Sanand, Gujarat, on August 28, 2025.

With the commissioning of the G1 facility, CG Semi has emerged among the country's first full-service OSAT providers, offering capabilities across both traditional and advanced semiconductor packaging technologies.

Management described the development as a significant step towards strengthening India's semiconductor ecosystem and supporting the country's ambition of achieving self-reliance in chip manufacturing while catering to global markets.

The G1 facility has been designed for a peak production capacity of 500,000 units per day, with efforts underway to further enhance output levels over the coming quarters.

Meanwhile, construction of the G2 facility, located approximately three kilometres from G1, is progressing and is expected to be completed by the end of calendar year 2026. Once operational, G2 will have the capability to process around 14.5 million chips per day.

Collectively, the two facilities are projected to create nearly 5,000 direct and indirect employment opportunities in the coming years.

CG Semi is also eligible for financial assistance under the India Semiconductor Mission. The project has received approval for a five-year period from FY25 to FY29 under a total investment plan of Rs. 7,584 crore. Central government support amounts to Rs. 3,501 crore, while additional assistance from the Gujarat government, equivalent to 40% of central support, is expected to contribute nearly Rs. 1,400 crore.

The fiscal support agreement was signed in January 2025, while the trust and retention account agreement was executed in September 2025.

Recognising rising demand across transmission and industrial infrastructure segments, the company has also approved a greenfield expansion project for its switchgear business.

The Board approved an investment of Rs. 748 crore, net of taxes, for the new facility in October 2025. The expansion aims to cater to growing requirements for medium-voltage and extra-high-voltage circuit breakers, instrument transformers and gas-insulated switchgear for both domestic and export markets.

Another major milestone for CG came from the export segment, where the company secured approximately Rs. 900 crore worth of power transformer orders from a US customer.

The contract, received in January 2026, is the largest single export order in the company's history and is intended for hyperscale data centre applications in the United States.

Under the agreement, CG will supply power transformers specifically engineered to meet stringent reliability, efficiency and uptime requirements demanded by data centre operators. Deliveries are expected to take place over a period of 12 to 20 months under FAS Mumbai Port terms.

For industry observers, the order signals growing opportunities arising from the global data centre boom and increasing investments in digital infrastructure. It also highlights the competitiveness of Indian power equipment manufacturers in serving sophisticated international markets.

With record financial performance, a rapidly expanding order book, leadership in transmission equipment, entry into semiconductor manufacturing and increasing participation in global data centre supply chains, CG Power appears well positioned to capitalise on emerging opportunities across power infrastructure, industrial systems and advanced manufacturing sectors in FY27 and beyond.
 

Published at : Sep 12, 2026 08:51 AM (IST)

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