High-Voltage Surge: HV T&D Players Boost Power Sector Dynamics

High-voltage transmission and distribution (HV T&D) players lead the power sector's growth in Q4 FY26, posting strong revenue and backlog figures despite an unbalanced risk-reward scenario. The sector expects increased transmission investments due to structural expansions and increased power demand, according to a Nuvama report.

During the fourth quarter of financial year 2026, high-voltage transmission and distribution (HV T&D) players emerged as standout performers within the power sector. According to a report from Nuvama, these players notched impressive gains with a 51.8% increase in order inflows and a 36.5% year-over-year revenue jump. EBITDA margins also expanded by 220 basis points to reach 19.9%, buoyed by favorable pricing and strategic operating leverage.

Nuvama's report indicates that while HV T&D players enjoy a robust execution pipeline, current valuations may impact investment appeal. The Central Electricity Authority's outline for a 900-gigawatt non-fossil fuel initiative by FY36 highlights a need for substantial transmission capital expenditure, pegged at approximately Rs 7.93 trillion. This plan extends the previous Rs 9.2 trillion framework set for 2022-2032 and enhances visibility for key industry players.

India's structural energy demands are intensifying, compounded by immediate supply challenges. The Nuvama report underscores that to meet a projected 6-7% rise in power demand, renewable and thermal energy growth must be substantial. The report also warns of potential shifts in demand and tendering dynamics, with non-power industries seeing modest revenue increases yet facing cost pressures.