CG Power Share Price In Green Post Q1 Result; Power Stock Ends 1.2% High | What’s Next For Investors?

CG Power Q1 Result Review

Despite a surge in profit, CG Power's Q1FY27 profit was below estimates even when the margin performance remained strong for the power systems segment, noted Motilal Oswal in its report. The power company's Q1 performance was impacted by one-time provisions for the industrial segment and continued high losses for the semiconductor segment.

"CG Power's 1Q result was below our estimates mainly due to lower-than-expected execution in the Power systems division, lower-than-expected margins in the Industrial systems division, and higher-than-expected losses in the semiconductor division," noted the company in its press release.

CG Power Share Price Outlook

"We marginally cut our estimates by 3%/4% for FY27/FY28 to bake in CG Power's 1Q performance. We expect overall order inflows to register an 11% CAGR over FY26- 29E. We model a revenue/EBITDA/PAT CAGR of 25%/33%/28% over FY26-29E, with EBITDA margin of 13.7%/15.1%/15.9% for FY27/FY28/FY29E," stated the brokerage in its report.

As per the brokerage, the bid pipeline remained healthy across transmission and distribution, utilities, renewables, data centres, and exports with no pricing pressure despite capacity addition across industry.

CG Power Share Price Recommendation

Motilal Oswal maintained 'Buy' rating for the stock but downgraded the target price to Rs 975 per share. "The stock currently trades at 87.8x/65.8x/52.0 P/E on FY27E/FY28E/FY29E EPS. We reiterate our BUY rating with a revised TP of INR975 (vs. INR990 earlier)."

CG Power Q1 Result Recap

CG Power and Industrial Solutions Ltd reported a stronger June-quarter profit and double-digit revenue growth, but a weaker operating margin kept investor sentiment cautious. The company's consolidated net profit rose 16.3% year-on-year to Rs 313 crore for the quarter ended June, compared with Rs 269.2 crore in the same period last year. Revenue from operations increased 14% to Rs 3,281 crore, against Rs 2,878 crore a year earlier.

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