Capital goods stock zooms 48% against QIP price in 2 months, hits new high

Hitachi Energy India hit a record high of ₹16,981.45, surging 6% on the BSE in Wednesday's intra-day deal ahead of Q4 results.

Share price of Hitachi Energy India today

 

Share price of Hitachi Energy India hit a record high of ₹16,981.45, surging 6 per cent on the BSE in Wednesday’s intra-day trade ahead of the board meeting today for announcement of its March 2025 quarter (Q4FY25) results. The capital goods company stock surpassed its previous high of ₹16,534.50 touched October 11, 2024.

 

In the past one month, the stock has outperformed the market by soaring 33 per cent, as against 5.7 per cent gain in the BSE Sensex.

 

At 02:15 pm; Hitachi Energy was quoting 5 per cent higher at ₹16,727.80, as compared to BSE Sensex, which was trading flat, at 81,147.

 

 

Stock price zooms 48% against QIP price

 

Share price of Hitachi Energy zoomed 48 per cent against its qualified institutional placement (QIP) price of ₹11,507 per share.

 

The fund raise committee on March 13, 2025, approved allotment of 21.9 million equity shares to eligible qualified institutional buyers (QIBs) at the issue price of ₹11,507 per share, aggregating to ₹2,520.82 crore.

 

The company allotted equity shares to Motilal Oswal Midcap Fund, NPS Trust - NC SBI Pension Fund Scheme - Corporate CG, SBI Life Insurance Company and Citigroup Global Markets Mauritius Private Limited – ODI.

 

The issue proceeds are proposed to be deployed in capacity expansions, working capital including for mega projects – including high-voltage direct current (HVDC), and other avenues to accelerate growth in its India operations.

 

Hitachi Energy selected to deliver 6 GW of renewable energy in India

 

On April 3, 2025, Rajasthan Part I Power Transmission, a subsidiary of Adani Energy Solutions (AESL), awarded a major contract to a consortium comprising Hitachi Energy India and Bharat Heavy Electricals (BHEL).

 

The contract will see the consortium design and deliver high-voltage direct current (HVDC) terminals to transmit renewable energy from the Bhadla area of Rajasthan to the industrial and transport hub in Fatehpur, Uttar Pradesh. The 6,000 megawatt (MW), 950 km HVDC link can power approximately 60 million households in India.

 

The project scope includes converter transformers, AC/DC control and protection, thyristor valves, 765 kV/400 kV grid connections, and auxiliary systems to be delivered by Hitachi Energy India and its consortium partner BHEL. The contract is in furtherance to the Letter of Intent dated February 8, 2025, received from Rajasthan Part I Power Transmission Limited, by the consortium of Hitachi Energy India and BHEL, the company said in a press release.

 

9MFY25 performance

 

Operating income stood at ₹4,501 crore for the nine months ended December 31, 2024 (9MFY25) on year-on-year (YoY) growth of 27 per cent, with operating margin at 7.95 per cent (compared to 4.7 per cent in the similar period last fiscal). The margin improved on account of healthy order inflow, better operating leverage and higher input price pass-through abilities. Crisil Ratings expects the margin to further increase in the near to medium term, basis better operating efficiency.

 

Outlook

 

Hitachi Energy while announcing Q3 earnings on January 29, 2025 said despite some downward recalibration of growth estimates for the short term, analysts peg the Indian economy is likely to grow over the coming years. In conjunction, India’s electricity demand is set to exceed 700 GW by 2047, 2.5 times the current levels. 

 

To meet this voluminous requirement, and its 2030 targets, the country needs to scale up its renewable capacity beyond 50 GW annually. This entails strengthening grid infrastructure and developing localized supply chains, in addition to adding generation capacity. Along with transmission infra buildup, focusing on high-performance sectors like energy storage, green hydrogen, and industries will add more momentum to the overall market growth. Thus, strategic investment in clean energy, transformative infrastructure, and digital innovation will help India meet its energy targets – mid and long-term- to achieve a sustainable energy future for all.

 

Crisil Ratings view on Hitachi Energy

 

The strong market position of the company in the power grid equipment and automation solutions segments is backed by its established track record. The company has executed several large projects in India. Clientele comprises reputed players across utilities, industrial, transportation and infrastructure sectors. Furthermore, the company was instrumental in bringing the Hitachi Ltd-patented HVDC technology to India. The established market position, strong order book and favourable industry scenario, with higher investments envisaged in the power transmission and distribution (T&D) segment in India (Revamped Distribution Scheme, Green Energy Corridors and expansion of inter-state transmission lines [ISTS] and intra-state transmission lines [InSTS]) should continue to support the business over the medium term, Crisil Ratings said in rationale.  The raised funds will be utilised mainly towards capital expenditure (capex) of ₹2,000 crore announced by the company in October 2024 for expanding its capacity and product portfolio across the large and small power transformers, dry and traction, HVDC and components and network control solutions offering; this is expected to be taken over the next 4-5 years.  Of the QIP proceeds, the funds utilized for capex would be ₹1513.28 crore, ₹350 crore will be utilised towards working capital requirement and the remaining for general corporate purposes. The funds raised will further strengthen the already robust financial risk profile of the company with high networth, low debt levels and strong debt protection metrics.  About Hitachi Energy 

Incorporated in February 2019, following the demerger of ABB India's power grid business unit, Hitachi Energy India provides product, system, software, and service solutions across the power value chain. The portfolio includes an extensive range of high-voltage products, transformers, grid automation products and power quality products and systems.