Power Grid to benefit from India’s transmission capex supercycle, Goldman Sachs reiterates bullishness

Power Grid is currently capable of funding 30 percent of the country's grid capex estimates for financial years 2024 to 2032 while maintaining its current dividend payout, the foreign brokerage stated in a note.

Additionally, Goldman Sachs highlighted that Power Grid benefits from a structural funding advantage and consistent core regulated earnings.

On September 24, domestic brokerage Motilal Oswal initiated coverage on the Indian power sector, issuing a 'buy' rating for Power Grid with a target price of Rs 425 per share.

Analysts project a substantial investment opportunity of over Rs 40 lakh crore in the sector, driven by rising demand, modernisation of outdated infrastructure, and transition to cleaner energy sources. This aligns with India’s ambitious goal of achieving 500 GW of renewable energy capacity by 2030.

By 2035, analysts estimate that one-third of power demand growth could stem from these sectors, with data center capacity projected to grow at 30 percent annually and significant EV adoption expected across vehicle categories.

The brokerage also highlighted opportunities in the transmission segment, where Power Grid alone could tap into an estimated Rs 2 lakh crore capex potential, further enhancing its growth prospects.

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