Buy Power Grid; target of Rs 222: Motilal Oswal

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26 Aug, 2025 12:21

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Motilal Oswal 's research report on Power Grid

Power Grid's (PWGR) 4QFY20 results highlight steady performance in the Transmission segment. Adj. PAT increased 7% YoY even as Consultancy/ Telecom EBIT declined 7%/4% YoY. FY20 capitalization stood at INR182b given the delay in commissioning of Raigarh-Pugalur. INR230b worth awards are up for bidding under various schemes; however, we expect some delays. In this context, a declining order book does put a risk of slowdown in growth.

Outlook

However, valuations at 1.3x FY22E P/BV and ~8-9% FY22E dividend yield remain attractive for a company with steady RoEs of ~17%. Maintain Buy with a DCF-based TP of INR222/share.

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