Hitachi Energy India Sees Target of Rs 30,768: Prabhudas Lilladher

Prabhudas Lilladher Downgrades Hitachi Energy India to 'Reduce'

Hitachi Energy India, a prominent player in the Indian energy sector, has reported a strong Q4FY26 performance. According to a research report by Prabhudas Lilladher, the company's revenue growth was 46.2% YoY, driven by robust execution across transmission, renewables, exports, and grid infrastructure projects. This growth was accompanied by an expansion of EBITDA margin by 363bps YoY to 16.3%, supported by operating leverage and disciplined cost management.

The research report highlights several key factors contributing to Hitachi Energy India's strong performance. The company's order pipeline remains robust across transmission, renewables, exports, and data centres, with a strong HVDC pipeline consisting of 3-4 large VSC/LCC projects expected over the next 2 years. Furthermore, the management has stated that there are no major capacity constraints to execute incremental opportunities. Additionally, the export business, which accounts for ~25% of ex-HVDC revenue, has continued to witness healthy traction supported by allocated overseas markets, globally exclusive product manufacturing, and feeder-factory opportunities supplying components to Hitachi Energy's global facilities.

The services contribution is expected to increase to ~10-12% of sales (currently 6-7%) in the medium term, which is likely to aid margin. However, this positive outlook is offset by the company's valuation. The stock is currently trading at a P/E of 109.1x/76.0x on the earnings of FY27/28E, which has led Prabhudas Lilladher to downgrade their rating from 'Hold' to 'Reduce'. The research firm has arrived at a target price of Rs30,768 (Rs26,108), driven by a P/E of 65x Mar'28E (60x Mar'28E earlier).

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Note: P/E stands for Price-to-Earnings ratio.