Top Transformer Stocks in India Ranked by Order Book

The global transformer market is poised for a surge to US$ 38.91 billion (bn) by 2030 (7.1% CAGR), driven by technological advancements and rising electricity demand.

Renewable energy's growth, particularly solar and wind, is fuelling demand for 100-500 MVA transformers.

Moreover, government initiatives aimed at grid upgrades and the incorporation of cutting-edge technology are also propelling the power transformer industry.

Apart from domestic demand, the international markets, notably, Middle East & Africa governments are actively fostering renewable energy, intensifying the need for transformers.

The demand is expected to continue on a strong footing, fuelled by new inter-state transmission system (ISTS)-connected power projects and HDVC projects.

To highlight the potential beneficiaries, we'll be focusing on the crucial metric of order book strength.

A robust order book signifies confirmed future revenue and strong demand for a company's products. Companies with consistently high order books are likely to be well-positioned for future growth.

In the following sections, we'll delve into five transformer companies operating in India. We will analyse their order book strength and other factors to determine which are best positioned to capitalise on this booming market.

#1 Voltamp Transformers

First on our list is Voltamp Transformers.

Voltamp Transformer is a significant manufacturer of oil-filled power and distribution transformers, with a 15% domestic market share as stated by management.

The comprehensive product portfolio is a direct result of the company's technical collaborations with a myriad of pioneers in the world.

The company reported a robust order book of Rs 18.5 bn for FY24, representing a significant 37% increase compared to the previous year.

Further solidifying its position, Voltamp Transformers entered FY25 with a strong opening order book of Rs 8.4 bn.

This healthy order book indicates strong demand for the company's products and positions them for potential growth in the coming year.

Voltamp Financial Snapshot (2020-24)

	2019-2020	2020-2021	2021-2022	2022-2023	2023-2024
Revenue Growth (%)	1.38%	-12.80%	53.01%	21.79%	13.40%
Net Profit Margin (%)	10.41%	16.21%	11.78%	14.44%	19.00%
Return on Capital Employed(%)	15.90%	17.83%	19.59%	25.50%	25.00%
Return on Equity (%)	12.46%	14.18%	14.96%	19.51%	29.00%

Source: Ace Equity

Between 2020-2024, the net sales and profits have registered at a 5-year CAGR of 13.3% and 29.3%, respectively. The returns have been strong, with a 5-year average Return on Capital Employed (RoCE) and Return on Equity (RoE) of 15.8% and 12.3%, respectively.

With a strong order book, a robust balance sheet and a positive outlook for profitability, the company is expected to grow well.

To know more about the bank, check out its financial factsheet and latest financial results.

#2 Transformers and Rectifiers

Next on our list is Transformers and Rectifiers.

Transformers and Rectifiers holds a prominent position as a leading manufacturer of transformers, boasting a capability to produce units up to the high voltage range of 1,200 kV.

The company's diverse product portfolio encompasses power & distribution transformers, furnace transformers, rectifier transformers and speciality transformers, catering to various applications.

Adding to the strong foundation, TRIL reported a record-breaking order inflow during FY24, totalling Rs. 20.5 bn. This impressive figure includes export orders of 11%, demonstrating their reach across diverse sectors like solar power plants, private industries, metro projects, railways and power utilities.

Furthermore, TRIL enjoys a healthy unexecuted order book as of 31 March 2024, valued at Rs 25.8 bn. This represents a significant 72% growth compared to F23 and signifies strong future demand for their products over the execution cycle of approximately 15 months.

Beyond confirmed orders, TRIL is actively negotiating inquiries exceeding Rs 170 bn as of 31 March 2024. These inquiries encompass various segments, including renewable and green energy, power transformers, and furnace transformers, indicating continued potential for growth.

TRIL's success stems from its strong in-house design and technical expertise. It has further bolstered the company's capabilities through technical collaborations and joint ventures specifically for 765 kV transformers and reactors.

While it's primary focus remains domestic, with 88% of revenue generated within India, it is actively expanding the reach internationally, currently serving over 25 countries.

Transformers and Rectifiers Financial Snapshot (2020-24)

	2019-2020	2020-2021	2021-2022	2022-2023	2023-2024
Revenue Growth (%)	-17.35%	4.87%	55.86%	19.90%	-7.42%
Net Profit Margin (%)	0.15%	1.03%	1.23%	3.03%	3.63%
Return on Capital Employed(%)	7.66%	9.40%	10.40%	14.97%	15.02%
Return on Equity (%)	0.31%	2.25%	4.08%	11.28%	9.91%

Source: Ace Equity

Between 2020-2024, the sales and net profits have registered a 5-year CAGR of 8.4% and 55.9%, respectively.

The 5-year average returns have also improved, with the RoCE and RoE propelling to 11.5% and 5.6%, respectively.

To know more about the bank, check out its financial factsheet and latest financial results.

#3 Apar Industries

The third stock on our list is Apar Industries.

The company is the world's largest conductor manufacturer, third largest transformer oil manufacturer and India's largest renewable cables manufacturer.

Its expansive market presence extends to global leadership, solidifying its position as a market giant.

The company reported a total orderbook of Rs 83 bn in the conductors and cables business as on 31 March 2024, up a staggering 33% in comparison to the same period last year.

Apar Industries Financial Snapshot (2020-24)

	2019-2020	2020-2021	2021-2022	2022-2023	2023-2024
Revenue Growth (%)	-6.64%	-13.85%	46.38%	53.45%	12.10%
Net Profit Margin (%)	1.82%	2.51%	2.76%	4.44%	5.11%
Return on Capital Employed(%)	28.82%	23.20%	27.94%	52.72%	NA
Return on Equity (%)	11.41%	12.51%	16.48%	32.28%	27.00%

Source: Ace Equity

Between 2020-2024, Apar Industries' revenue and net profit have grown at a CAGR of 15.1% and 43.5%, respectively. This surge in profitability has resulted in a healthy set of return ratios. The company's RoE stands at 19.9%.

Apar Industries' competitive advantage lies in its strong position in thriving markets, combined with cost efficiency and strategically located manufacturing facilities.

The company's optimistic long-term demand outlook, supported by a robust order flow and growth opportunities, sets the stage for sustained revenue growth over the foreseeable future.

Moreover, the Ministry of New and Renewable Energy has a target of awarding 50 gigawatts per annum of renewable energy capacity, including 10 gigawatts per annum from wind energy between 2024 and 2028.

The company believes that if even a portion of these aggressive plans get executed, the demand for conductors, cables and transformer oil will all remain strong.

To know more about the bank, check out its financial factsheet and latest financial results.

#4 CG Power

Fourth on our list is CG Power.

CG Power, also known as Crompton Greaves Power, is an Indian multinational company that specialises in electrical equipment and engineering solutions.

The company provides a wide range of products and services including, transformers, switchgear, motors, automation products and EPC solutions for power transmission and distribution.

In FY24, the switchgear and transformer along with the railways business achieved the highest-ever sales, highest-ever order inputs and profits.

As a result, the company reported a substantial increase in its unexecuted order book. Unexecuted order book as of 31 March 2024, was 45% higher year-on-year at Rs 62.7 bn against Rs 43.2 bn as of 31 March 2023.

In recent years, the company has undergone significant restructuring and has implemented several strategic initiatives to improve operational efficiency and profitability.

These efforts have resulted in improved financial performance, reduced debt and a positive outlook for the company.

CG Power Financial Snapshot (2020-24)

	2019-2020	2020-2021	2021-2022	2022-2023	2023-2024
Revenue Growth (%)	-35.91%	-40.38%	79.53%	27.52%	15.79%
Net Profit Margin (%)	-25.76%	42.72%	11.40%	11.35%	10.70%
Return on Capital Employed(%)	-33.45%	150.83%	60.94%	65.51%	48.88%
Return on Equity (%)	-1666.79%	0.00%	146.30%	57.55%	36.44%

Source: Ace Equity

The sales and net profit have improved drastically since FY22. Consequently, the returns have increased.

To know more about the bank, check out its financial factsheet and latest financial results.

#5 GE T&D

GE T&D is a leading manufacturer of transformers across various applications, including power transmission and distribution and the booming renewable energy sector.

GE T&D has strategically focused on providing transformers specifically designed for these applications, recognising the growing importance of renewable energy sources like solar and wind.

This commitment has positioned the company as a frontrunner in the Indian market, supplying transformers that play a crucial role in integrating renewable energy into the power grid.

It's order backlog surged to a record-breaking Rs 62.7 bn as of 31 March 2024, reflecting a massive 69% increase year-on-year compared to Rs 37.0 bn in March 2023.

This robust backlog indicates a strong pipeline for future revenue. Further solidifying its momentum, GE T&D secured record-breaking order bookings throughout FY24.

The fourth quarter witnessed a significant 53% YoY jump to Rs 13.3 bn, and the entire financial year closed with a remarkable 112% YoY increase, reaching Rs 57.9 bn compared to Rs 27.4 bn in FY24.

GE T&D Financial Snapshot (2020-24)

	2019-2020	2020-2021	2021-2022	2022-2023	2023-2024
Revenue Growth (%)	-24.76%	9.32%	-10.21%	-10.93%	14.00%
Net Profit Margin (%)	-9.58%	1.75%	-1.62%	-0.05%	5.70%
Return on Capital Employed(%)	-17.62%	12.05%	-0.84%	6.96%	23.00%
Return on Equity (%)	-24.41%	5.55%	-4.50%	-0.14%	16.00%

Source: Ace Equity

Between 2020-2024, the sales and net profits have been on a roller coaster. However, it seems as though the company is turning around after minimising its losses in FY23. The business has reported a massive turnaround in FY24, reporting a net profit of Rs 1.8 bn.

To know more about the bank, check out its financial factsheet and latest financial results.

In Conclusion

The Indian transformer industry is electrifying its future. Fuelled by a surge in domestic demand for transmission and distribution products, Indian manufacturers are also witnessing a rise in international orders.

This promising outlook is further bolstered by global infrastructure spending, the "China plus one" strategy diversifying supply chains, and the growing embrace of renewable energy, which all create a strong need for transformers.

Additionally, industry consolidation presents opportunities for Indian companies to establish themselves as leading players in the global transformer market.

Happy Investing!

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