Danish Power plans Rs 200 crore expansion into 400 kV transformers

In H1 FY27, Danish Power Limited said it plans a Rs 200 crore expansion that will add 15,000 megavolt-amperes (MVA), take installed capacity to 26,000 MVA and enable its first 400 kilovolt (kV) transformers, with commissioning targeted 18 to 24 months after site work begins around December 2026.

What does Danish Power's Rs 200 crore expansion include?

Danish Power's third expansion is designed to add about 15,000 MVA of transformer-making capacity, taking total installed capacity to 26,000 MVA. Management described the project on the November 5, 2026, H1 FY27 earnings call as its next phase of capacity expansion and estimated the capital outlay at about Rs 200 crore.

The new facility will be dedicated to extra-high-voltage transformers in the 132 kV, 220 kV and 400 kV classes. The 400 kV product class will be a first for Danish Power, widening its stated product range beyond the capacity added in the earlier expansion that became operational in January 2026.

Management said the expansion had been sized against demand from existing domestic and international customers. It said repeat clients typically account for 70% to 80% of orders, meaning the capacity plan is based principally on customers already buying from Danish Power rather than solely on prospective business.

When will Danish Power's new transformer capacity start production?

Danish Power plans to start site work around December 2026 and targets commissioning the new capacity within 18 to 24 months of that start. Management repeated during the question session that the 18-to-24-month schedule runs from December, rather than from the November 2026 announcement date.

The timing follows the January 2026 activation of the company's recent expansion, which doubled capacity to more than 11,000 MVA. In H1 FY27, Danish Power reported production output of approximately 3,100 MVA and plant utilisation of about 60%, describing FY27 as the first year after that January capacity increase.

Management expects the existing capacity to reach peak utilisation in FY28, which it defined as roughly 90% to 92% in the transformer industry. At that utilisation level, Danish Power guided for FY28 revenue of Rs 900 crore to Rs 950 crore, while the new 15,000 MVA facility is a later addition under the 18-to-24-month construction target.

How will Danish Power fund the Rs 200 crore project?

Danish Power intends to fund about Rs 100 crore of the project through internal accruals and about Rs 80 crore to Rs 100 crore through debt. Management said the company had no debt on its books as of the November 5, 2026, call, making the proposed borrowing a new part of the funding mix for this expansion.

The funding plan comes after H1 FY27 consolidated revenue of Rs 291.93 crore, up 38% year on year, and earnings before interest, tax, depreciation and amortisation (EBITDA) of Rs 55.73 crore, up about 49%. EBITDA margin was about 19.1% in the half year, while profit after tax (PAT) was Rs 37.72 crore and PAT margin was around 12.9%.

Danish Power said its business is structurally weighted toward the second half, with H1 generally lighter than H2. Its confirmed order book was over Rs 600 crore as of the call, with deliveries spread over the next six to nine months, and management said this supports its FY27 revenue guidance of more than Rs 700 crore while seeking to maintain similar margins.

How much of Danish Power's new capacity is intended for exports?

Danish Power intends to reserve about 30% to 40% of the new 15,000 MVA capacity for international markets. Management identified Europe and the Middle East as important and fast-growing export regions, and said capacity had constrained the volumes it could commit to overseas customers.

Exports increased to approximately 15% of H1 FY27 revenue from about 8% in the previous financial year, nearly doubling their revenue-mix share. Management said its focus is profitable export growth rather than volume-led expansion, while describing demand across battery storage, renewable and thermal generation, transmission and distribution, and exports as healthy.

The export allocation is linked to the new facility's higher-voltage offering rather than a disclosed export-order target. Management said the additional 15,000 MVA could generate Rs 1,400 crore to Rs 1,500 crore of additional revenue, but added that the outcome would depend on product mix, timing and movements in raw-material prices.

What could affect Danish Power's expansion economics and delivery?

Danish Power said raw-material availability and pricing became highly volatile following the West Asia war, while freight costs also increased. Some contracts use price-variation clauses with defined formulas and indices, which management said limit exposure, whereas certain firm-price contracts required discussions with customers under what it described as force majeure conditions.

Management said it did not expect a significant carryover of the volatility into H2 FY27 because most current order-book orders were taken from April onward, and any older order would be supported by a price-variation clause. It also cautioned that the war was not over, leaving the next few months uncertain despite its view that the immediate H2 effect should be limited.

Danish Power is also increasing component self-sufficiency before the 18-to-24-month expansion comes online. It now makes about 20% of its total tank requirement in-house, while its fully automated radiator plant was scheduled for commissioning by the end of November 2026 and is expected to meet about 80% to 90% of radiator requirements.

Conclusion

Danish Power's Rs 200 crore plan combines a 15,000 MVA capacity addition with entry into 400 kV transformers and a proposed 30% to 40% international allocation. The project would take installed capacity to 26,000 MVA, while H1 FY27 revenue of Rs 291.93 crore, an order book above Rs 600 crore and exports at about 15% of revenue provide the operating backdrop disclosed by management.

The next milestones are the planned December 2026 start of site work, the radiator-plant commissioning expected by the end of November 2026, and progress toward the 18-to-24-month commissioning target. Investors will also watch Danish Power's path to the management-guided FY28 revenue range of Rs 900 crore to Rs 950 crore at projected 90% to 92% utilisation of existing capacity, alongside raw-material and freight volatility.