This article first appeared on GuruFocus .
Release Date: August 07, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Hitachi Energy India Ltd ( BOM:543187 ) reported a robust 26.5% year-on-year growth in order intake (excluding HVDC), reaching INR 5,096.5 crore, driven by strong demand across renewables, data centers, and industries.
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The company achieved a record order backlog of INR 32,222.1 crore, providing strong revenue visibility for the coming quarters.
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Revenue from operations grew by 68% year-on-year to INR 2,493 crore, with profit after tax margin expanding to 11.8% from 8.9% in the prior year.
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The company secured its first battery energy storage system (BESS) project, a 165 MW/330 MWh order, marking a strategic entry into a new high-growth segment.
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Hitachi Energy India Ltd ( BOM:543187 ) began construction of its 20th manufacturing facility in Karjan, Vadodara, a fully digital smart factory, to support future capacity expansion and localization.
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The company won multiple data center orders, including a notable 42.5 MVA project in Hyderabad, reflecting strong momentum in the emerging digital infrastructure sector.
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Export contribution remained healthy at approximately 25% of revenues, with a significant European order for a 2 GW wind power evacuation project (worth ~INR 1,700 crore) secured during the quarter.
Negative Points
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The company reported an unrealized foreign exchange loss of INR 36.37 crore during the quarter, which negatively impacted reported EBITDA and profit margins.
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Gross margins contracted slightly on a year-on-year basis due to a shift in product mix, although management noted consistency with the full-year level.
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Order intake in the transmission segment was temporarily weak due to timing issues, while railway and metro projects are facing delays, with pick-up expected only in the second half of the year.
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The BESS business is still in its early stages, with margins expected to be lower initially until technology matures and localization efforts are completed.
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Management acknowledged ongoing macroeconomic uncertainties, geopolitical crises, and elevated commodity prices as potential challenges to project execution and profitability.
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The company faces potential competitive pressure from the recent government approval allowing four Chinese players to enter the market, though management downplayed the immediate impact.
Q & A Highlights
Q: Could you provide details on the 2-gigawatt wind power evacuation order in Europe, including its value, and whether more such orders are expected from the global Hitachi Energy-L&T joint venture? A: N. Venu, MD and CEO, confirmed the order is a combination of three transmission links that will deliver 6 gigawatts of clean electricity to the grid. The combined value of these three orders is approximately INR 1,700 crores. He indicated that the company is actively pursuing more such opportunities in the global market.
Q: What is the company's strategy for the newly won Battery Energy Storage System (BESS) project, and will the focus be on the domestic or export market? A: N. Venu, MD and CEO, stated that the immediate focus is on the domestic market, which has a robust requirement driven by mandates for renewable energy storage. He noted that as a new technology, the company will first ensure successful deployment before scaling up. The pipeline for BESS is described as "quite robust."
Q: Can you explain the year-on-year contraction in gross margins, and what is the company's offering and competitive positioning in the BESS segment? A: Abhay Singh, CFO, clarified that the slight gross margin contraction is due to the product mix executed in the quarter, while margins remain consistent with the March year-end closing. Regarding BESS, N. Venu explained that the offering is a modular, scalable solution that excludes batteries but includes design, automation, PCS, and grid connection. He noted that margins will improve as the technology matures and localization increases.
Q: What is the current export contribution to order inflows and revenues, and how does the company view competition from Korean and Mexican manufacturers? A: Abhay Singh, CFO, stated that export contribution to revenues is approximately 25%. N. Venu, MD and CEO, added that the company is already competing with global players and sees no issue as long as there is a level playing field. The new manufacturing facility in Karjan, Vadodara, is part of a strategy to increase capacity and localize components, which will enhance competitiveness.
Q: What is the outlook for the HVDC pipeline, and how will the entry of Chinese players into the Indian market impact the company? A: N. Venu, MD and CEO, stated that a Greenfield HVDC project is currently being bid and is expected to be awarded within six months. Regarding Chinese competition, he welcomed it as a way to meet demand-supply challenges, but emphasized that as long as there is a level playing field, the company sees no material impact on its business or margin ambitions.
Q: Can you provide more color on the BESS offering, specifically regarding localization and the scope of work? A: N. Venu, MD and CEO, explained that the company approaches BESS in two ways: supplying PCS solutions (not yet localized) and providing complete end-to-end grid integration solutions. The offering excludes batteries but includes complete design, automation, PCS, and grid connection, along with the digital layer and software for monitoring and services.
Q: The order mix shows a downturn in transmission and railway/metro segments. Is this a temporary issue? A: N. Venu, MD and CEO, confirmed that the transmission slowdown is a temporary timing issue, not a segment problem. For railways and metro, projects are not coming as per plan, but the company expects them to pick up in the second half of the year.
Q: What is the company's scope of work for the Kinet Railway Solutions project, and what is the potential order value? A: N. Venu, MD and CEO, stated that the scope of work depends on whether it is for locomotives or cross-country applications, with the company's 4B business unit portfolio being relevant. He declined to share the specific quantum of the opportunity at this point.
Q: What percentage of the order backlog is non-HVDC, and what is the proportion of data center contracts? A: N. Venu, MD and CEO, declined to provide a specific breakdown of HVDC versus non-HVDC in the backlog, but noted that data center orders were "quite large" in the quarter. He added that the visibility for data center orders going forward is very strong, contingent on government support for land and fast-tracking projects.
Q: How is the company insulated from commodity price volatility, particularly in the non-transformer business? A: Abhay Singh, CFO, stated that approximately 70% of contracts have variable price clauses, which mitigates commodity impact. He confirmed that there was no material commodity impact in the current quarter, and any small impacts are being managed effectively.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
