Power Transmission Stocks Experience Surge, But Are Hitachi and GE Investments Still Viable?

India's Clean Energy Push Accelerates, Power Transmission Sector Sees Growth

Mumbai: India's push towards clean energy has led to an increase in electricity generation far from consumption points, particularly in solar parks and windy coastlines. To efficiently transmit this power, high voltage direct current (HVDC) transmission has become a critical enabler. The growing interest in the power transmission sector is evident in the recent surge of Hitachi Energy India's stock price to an all-time high of ₹29,900 per share on Monday.

Investors have already seen significant returns from the sector, with GE Vernova T&D India surging 176% over the past year, while Hitachi Energy India has rallied 115%. Siemens Energy India, on the other hand, has gained a more modest 11%. The question now is whether the easy money has been made, or if earnings can keep pace with valuations.

Market Valuations and Growth Projections

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According to Mordor Intelligence, India's HVDC transmission market is projected to grow from $4.19 billion in 2026 to $6.31 billion by 2031, at a compounded annual growth rate (CAGR) of 8.55%. This growth is driven by the increasing need for long-distance transmission as renewable capacity expands.

The near-term beneficiaries of this growth are expected to be Hitachi Energy India and GE Vernova T&D India, which are well-positioned to capture the immediate upside from HVDC ordering. Siemens, on the other hand, may take a couple of years to start seeing meaningful benefits, as it has chosen to focus on VSC technology, which is ideal for renewables and complex power networks.

Exports and Order Books

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Exports are emerging as a second leg of support for the sector, with Hitachi Energy's export share climbing to around 27% in FY25 (from 20% in FY21), while GE Vernova India is also at roughly 27% in FY25 (from 22% in FY21). Order books, too, point to sustained demand visibility, with GE's backlog rising to ₹14,380 crore in the December quarter from ₹13,110 crore in the previous quarter.

Valuations and Execution

Valuations are beginning to do the heavy lifting, with Siemens trading at about 40 times estimated FY28 earnings, while Hitachi commands a steeper valuation of around 64 times. GE Vernova trades at 58.73 times its estimated FY28 earnings. A potential upside trigger for Hitachi is a reduction in royalty payments to its parent, which could meaningfully lift margins.

The setup is finely balanced, with a strong demand cycle, intact order visibility, and a compelling long-term case for HVDC. However, after a sharp rally, returns from here are likely to depend less on the theme itself and more on execution – fresh order wins, export momentum, and margin delivery.