Power Grid Corporation of India is expected to post a largely stable performance for the second quarter of FY26, with both revenue and profit showing only marginal improvement from last year. The power company is expected to announce its results on November 3.
Currently, Power Grid has limited coverage. A Moneycontrol Poll from four brokerages suggests that revenue is estimated at Rs 11,548 crore, up 0.2 percent year-on-year, while net profit is seen at Rs 3,800 crore, also rising 0.2 percent from the year-ago period. The EBITDA margin may moderate to 84.3 percent from 86.3 percent in Q2FY25, reflecting higher operating costs and a subdued pick-up in capitalisation.
Among the brokerages, Elara is the most optimistic, expects revenue of Rs 11,922 crore, net profit of Rs 4,033 crore, and an EBITDA margin of 82.8 percent. Antique is the most pessimistic, estimating revenue of Rs 11,469 crore, net profit of Rs 3,690 crore, and an EBITDA margin of 85.8 percent.
Key drivers
Capitalisation remains the main earnings driver
Stronger capitalisation is expected to support earnings this quarter. Antique estimates around Rs 3,500 crore of capitalisation in 2QFY26, which should lift regulated equity by about 3% and support around 4% YoY PAT growth. For the full year, Power Grid has guided to Rs 23,000–25,000 crore of capitalisation in FY26, an improvement from last year. Motilal expects improving capitalisation and capex to drive 5%/6% YoY growth in EBITDA and adjusted PAT.
Capex pipeline provides clear growth visibility
A large ongoing capex plan supports the steady expansion of regulated assets. Elara highlights capex of Rs 28,000 crore for FY26, rising to Rs 35,000 crore in FY27 and Rs 45,000 crore in FY28. Work-in-hand stands at Rs 1,48,600 crore, covering regulated projects, new sanctioned assets, and TBCB projects. Gross fixed assets of Rs 2.92 lakh crore and CWIP (Capital Work In Progress) of Rs 41,600 crore reflect a strong execution pipeline.
Profitability improving as O&M pressures ease
Earnings should recover as the impact of tighter O&M norms fades. FY25 PAT growth was affected by these changes, but Antique expects FY26 PAT growth of 6–7%. Kotak notes that weak capitalisation over the past year continues to limit quarterly PAT growth, though telecom and consulting activities provide some support.
TBCB projects increasing scale but affecting returns
The growing share of TBCB (Tariff-based Competitive Bidding) work raises execution activity but usually delivers lower RoE than regulated assets. Elara expects Rs 19,100 crore of TBCB spending in FY26, within a larger TBCB portfolio of nearly Rs 99,900 crore. This expands project volumes but influences the overall return profile relative to the core regulated business.
Renewable energy push creating long-term opportunities
India’s rapid renewable capacity addition strengthens Power Grid’s long-term outlook. Elara highlights that the company is positioned to benefit from a Rs 2 trillion (Rs 2 lakh crore) transmission pipeline required over the next 7–8 years for renewable evacuation. Power Grid’s involvement in strategic and complex lines such as the Leh transmission corridor further supports multi-year growth potential.
Non-core businesses helping support revenue
Telecom leasing, consulting and other non-transmission activities offer incremental support to revenue. Kotak notes that these businesses help cushion the impact of softer capitalisation. Brokerages expect 2QFY26 revenue growth of 4–6% YoY, with Motilal projecting standalone revenue of around Rs 10,600 crore.
What analysts will be watching out for
Analysts will focus on management commentary around the capitalisation run-rate, progress on TBCB (Tariff-Based Competitive Bidding) projects, and visibility on renewable-linked transmission awards as key indicators for the rest of FY26.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
