CG Power target raised to Rs 1,100 on exports (2026)

Stock rally extends as broker turns more constructive

CG Power & Industrial Solutions Ltd has been one of the stronger performers in 2026, with the stock up about 47-48% year-to-date. The shares hit a fresh 52-week high of Rs 950.1 on 4 June 2026, highlighting sustained buying interest after multiple brokerage upgrades. Nomura has now raised its target price, pointing to steady domestic demand and a potential acceleration in exports for the electrical engineering solutions company. The core of Nomura’s argument is that supply tightness in Western markets, combined with CG Power’s capacity expansion, improves its ability to win transformer and switchgear orders. The brokerage also linked the opportunity set to high data-center and grid capex in the US and Europe, where lead times are described as stretching into years. Against that backdrop, the latest target upgrade is framed around a longer runway for Power Systems.

Nomura raises target price and flags further upside

Nomura increased its target price for CG Power to Rs 1,100 from Rs 1,050. That target implies about 17% upside to Thursday’s closing price of Rs 941.90, according to the note cited. In a separate update around the March-quarter results, Nomura was also cited as maintaining a Buy rating while raising its target to Rs 920 from Rs 820, referencing an EBITDA and order inflow beat and the benefit of transformer capacity expansion. Taken together, the set of notes indicates that Nomura has remained positive across different publication dates, with target prices varying by report. The same broader thesis remains consistent: Power Systems execution, improving export optionality, and a capacity-led growth plan.

Transformer capacity expansion and export mix shift

Nomura said CG Power’s entire transformer capacity has been dedicated to meeting healthy domestic demand. The brokerage highlighted a transformer capacity expansion to 110 GVA, described in different reports as a 1.7 times expansion and elsewhere as a 1.5 times expansion to 110 GVA by 2026. Nomura expects 25-30% of the expanded capacity to be used for exports, which it believes positions the company to benefit from robust US power transformer export opportunities. The brokerage also noted that CG is currently focusing more on the non-utility segment in the US, as US utility approvals can take 1-3 years to come through. Nomura’s view is that higher exports can expand the company’s total addressable market and support margin stability, particularly when global supply is constrained.

Growth expectations for Power Systems and earnings

Nomura expects the Power Systems (PS) segment to deliver 41% revenue CAGR and 37% EBIT CAGR over FY26-29F. It also expects exports to gradually reach 25% of PS order inflows by FY29F. On the earnings side, Nomura raised its FY28F and FY29F EPS estimates by 4% and 5%, respectively, to reflect a stronger export outlook and higher margins. The brokerage estimated a 33% EPS CAGR over FY26-29F, linking the trajectory to segment mix and export contribution. These projections were presented alongside commentary that sustained domestic momentum remains a base driver, with exports providing incremental upside and stability.

Q4 FY26 results: revenue and profit growth

One support for the broker optimism has been the company’s reported financial performance. For Q4 FY26, CG Power reported a 25.03% year-on-year rise in consolidated revenue from operations to Rs 3,440 crore (from Rs 2,750 crore). Consolidated net profit rose 32.5% year-on-year to Rs 360 crore (from Rs 270 crore) for the quarter, as cited in the same results summary. Another brokerage-style summary of Q4 FY26 also stated consolidated revenue increased 25% to Rs 3,442 crore and EBITDA rose 30% to Rs 544 crore, with margins improving by 60 basis points to 15.8%. That summary additionally stated net profit after tax rose 31.8% to Rs 36 crore, presented alongside operational leverage commentary. Investors tracking the name should note that these published summaries present differing profit figures for the quarter, even while revenue growth and margin improvement are consistently highlighted.

Segment performance: Power Systems stands out

In Q4 FY26, the Power Systems division revenue was reported at Rs 1,487 crore, up 49.7-50% year-on-year in the cited reports, driven by strong demand and disciplined execution. The Power Systems EBIT margin was reported at 23.8% versus 20.9% a year earlier in one summary, pointing to improved profitability as deliveries improved. The Industrial Systems segment was reported to have grown 2.3% to Rs 1,791 crore in one account, with commentary that motors and drives progressed but the railway business faced competitive pricing pressure and a higher share of lower-margin contracts. Management commentary cited in the summaries also pointed to rising commodity costs as a factor weighing on profitability in parts of Industrial Systems.

Full-year FY26: revenue and profit rise

For the full year, revenue increased 25.3% to Rs 12,420 crore in FY26 from Rs 9,910 crore in FY25. Net profit rose 23.2% to Rs 1,190 crore in FY26 from Rs 970 crore in FY25. These numbers, along with Q4 growth, have supported a re-rating narrative, even as broker notes flag that valuation is elevated. One summary explicitly warned that the stock was trading at a premium valuation, with a PE of around 94.

Orders, capex and capacity build-out signals

Nomura said CG Power’s Q4 consolidated order inflows were Rs 5,340 crore, which it described as 11% ahead of its estimate. Another brokerage note referenced a strong order book of Rs 9,000 crore and a 58% year-on-year increase in order inflows, providing revenue visibility for the next 18-24 months. Separately, CG Power’s board approved an investment of Rs 712 crore to set up a 45,000 MVA transformer manufacturing unit in western India, expected to be completed by FY28. Across these updates, the recurring theme is capacity addition aligned to both domestic and export demand.

Data-center capex theme and the India cost edge

Nomura also linked the opportunity to broader capex trends, naming CG Power and GE Vernoba T&D India as top picks to benefit from the capex surge, with target prices of Rs 1,050 and Rs 5,675, respectively, in that note. The same note cited JLL data to highlight India’s cost advantage for hyperscalers, with construction costs estimated at about $1-7 million per megawatt compared with $10-18 million in developed Asia-Pacific and Western markets. It also said competitive electricity sourcing through open access and renewable power purchase agreements can bring effective power costs down to 6-7 US cents per kilowatt-hour. Another supporting data point cited was India’s data traffic per installed megawatt at roughly 18 petabytes, versus China’s 4-5, suggesting a gap between digital consumption and data center supply. The note projected cloud, SaaS and AI markets in India could grow at a 20-40% CAGR through 2030.

Key figures at a glance

Market impact: upgrades versus valuation concerns

The stock’s sharp run-up in 2026 has been supported by strong Power Systems execution and the prospect of export-led growth, as reflected in repeated Buy recommendations. Multiple broker targets were cited across the updates, including Emkay Global’s Rs 875, MOFSL’s Rs 940, and Nuvama’s bull-case target of Rs 955, in addition to Nomura’s various targets across different notes. The average 12-month price target was cited at Rs 888.63, with a high estimate of Rs 1,100 and a low estimate of Rs 502. At the same time, the caution flagged in the coverage is valuation, with a PE of around 94 mentioned, meaning incremental upside depends on continued delivery on margins, order conversion, and export ramp-up.

Analysis: why exports and capacity timing matter

Nomura’s central point is that CG Power sits at the intersection of supply constraints in Western markets and a domestic capex plan that expands transformer capacity to 110 GVA. If export share of Power Systems order inflows rises toward the 25% level by FY29F, as expected in the note, it can diversify the demand base beyond India’s utility cycle and reduce reliance on a single end market. The comment that US utility approvals can take 1-3 years also frames why a non-utility focus is being highlighted as a nearer-term lever. Alongside this, the consistent emphasis on execution in Power Systems and margin improvement suggests that investors and analysts are tracking whether profitability gains sustain as volumes rise. The mix within Industrial Systems, especially the railway business impact from competitive pricing and commodity costs, remains an offset in some quarters based on the summaries.

Conclusion: what investors will track next

CG Power’s 2026 rally has been reinforced by Q4 and FY26 growth, capacity expansion plans, and broker expectations of a rising export contribution. The next markers in the narrative are progress toward the 110 GVA transformer expansion and how quickly exports scale toward the levels outlined by Nomura. Investors will also watch whether segment margins remain firm as the order book converts and as Industrial Systems profitability improves, as suggested in multiple brokerage notes.