Hitachi Energy India Limited — Credit Ratings, 25-03-2025: Credit Rating

Hitachi Energy India Limited reported consolidated financial results indicating a revenue of ₹5,238 crore, marking a 16% growth compared to ₹4,469 crore in the previous year. This growth can be attributed to increased demand in the power transmission sector, driven by significant investments in infrastructure development.

The company recorded a profit after tax (PAT) of ₹164 crore, reflecting a notable improvement from ₹94 crore the previous year, resulting in a PAT margin increase to 3.1% from 2.1%. This enhancement in profitability is primarily due to improved operational efficiencies and an increase in order inflow.

Operational costs have been effectively managed, with a calculated interest coverage ratio of 6.6 times, up from 4.9 times, underscoring better cost management practices and a healthier financial structure.

The balance sheet remains robust, featuring a strong liquidity position with approximately ₹900 crore in cash equivalents and an unutilized bank limit of ₹952 crore. The company's order book stands at ₹18,994 crore, indicating a strong backlog that supports future revenue visibility.

Strategically, Hitachi Energy is expected to continue focusing on capacity expansion and product diversification driven by a recent equity raise of ₹2,520.82 crore through qualified institutional placement. This development is set to enhance the company's financial stability and operational capabilities.

Investor sentiment appears optimistic, suggesting a 'buy' outlook based on strong fundamentals and growth potential, although potential risks include intense market competition and the volatility of raw material prices.