2026 has been a strong year for high-voltage transmission and distribution (T&D) equipment stocks, with , , , and rising 66%, 34%, 23%, and 35%, respectively, year-to-date (YTD). In comparison, the BSE Capital Goods Index has gained 10% over the same period.
The rally has come at a time when broader markets have been impacted by escalating geopolitical tensions. However, the sector has attracted investor interest amid a widening global supply-demand gap for high-voltage power equipment, including transformers, switchgear, and circuit breakers, as well as strong multi-year order pipelines for companies in both domestic and international markets.
However, the rally in these stocks has recently paused as investors appear to be booking profits amid concerns over elevated valuations.
Nevertheless, domestic brokerage firm 360 ONE Capital Markets said the recent price correction in these stocks has eased concerns over rich valuations, as much of the potential upside had already been priced in, leaving little room for error.
360 ONE Capital Markets initiates coverage on three T&D stocks
In its latest report, the brokerage has initiated coverage on three companies exposed to the high-voltage power equipment theme: Hitachi Energy India, GE Vernova T&D India, and CG Power and Industrial Solutions.
The brokerage sees a structural, multi-year growth opportunity in T&D, driven by high-voltage direct current (HVDC) technology, transformers, and grid expansion. However, it believes the companies’ earnings trajectories and exposure to higher-growth adjacent segments differentiate them.
Among these, the brokerage believes Hitachi Energy India offers the strongest upside at current valuations, supported by its structural growth drivers and relatively higher exposure to non-T&D opportunities such as data centers, semiconductors, and renewables.
The brokerage has assigned a Buy rating to Hitachi Energy India, GE Vernova T&D India, and Siemens Energy India, with target prices of ₹36,849, ₹4,919, and ₹3,101, respectively. These target prices imply upside potential of 10%–20%.
It has assigned a Hold rating to CG Power and Industrial Solutions, with a target price of ₹886.
Renewable energy expansion to drive grid investments
The brokerage highlighted that renewable energy capacity is projected to rise from 283.5 GW in March 2026 to 596.3 GW by FY32 and 786 GW by FY36, accounting for around 71% of the projected total generation capacity of 1,121 GW. With renewable generation concentrated away from load centers and providing limited inertia, this transition is reshaping grid requirements.
Long-distance power evacuation will increasingly require HVDC systems, while grid stability needs are expected to drive demand for static synchronous compensators (STATCOMs), reactors, and other flexible AC transmission systems (FACTS) solutions.
Transformation capacity is expected to nearly double from 1,450,526 MVA in March 2026 to 2,411,885 MVA by FY32, underpinning approximately ₹9.2 trillion in transmission investments.
Global equipment shortage opens export opportunities
The brokerage also highlighted that a global shortage of high-voltage equipment is creating export opportunities that were largely absent during the previous cycle. GE Vernova T&D India’s export share increased from 17% of revenue in FY20 to 33% in FY26, while Hitachi Energy India’s bidding mix implies an export exposure of 29%–30%.
CG Power and Industrial Solutions’ $99 million Tallgrass Order also marks its entry into the US hyperscale data center market. Importantly, export demand is skewed towards HVDC systems, grid modernization, gas-insulated switchgear (GIS), and instrument transformers, supporting a structurally stronger product mix and pricing.
According to the brokerage, data centers provide another growth driver, with India’s installed capacity below 2 GW compared with an expected 13–18 GW by 2030. This translates into an estimated ₹850 billion– ₹1,050 billion opportunity for Hitachi Energy India, equivalent to 1.0–1.5 times its FY26 revenue.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.