GVT&D Q2 FY27 Earnings Call: Guides Over 30% Growth Through FY31, Q2 Orders Jump 52%

GVT&D held its Q2 FY27 earnings call on October 30, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Broad-based beat: 32% revenue growth, EBITDA at top of guidance band

• Revenue of Rs.20.3 billion in Q2 FY 2026-2027 — up 32% YoY vs Rs.15.4 billion in Q2 FY 2025-2026; H1 FY 2026-2027 revenue ~Rs.30.6 billion, up 35% YoY.
• EBITDA of Rs.5.5 billion (27.1% of revenue) — at the higher end of the mid-20s guidance band communicated for FY 2026-2027; H1 FY 2026-2027 EBITDA margin ~26.2%.
• Gross margin at 44.5% in Q2 FY 2026-2027 — CFO Sushil Kumar called the ~45% level "not exceptional," noting FY 2025-2026 delivered a similar gross margin with 27% EBITDA; management declined to guide on gross margin sustainability, citing mix swings (product vs project, export vs domestic).
• PBT of Rs.5.8 billion (before exceptionals), up 1.4x YoY — vs ~Rs.4 billion in Q2 FY 2025-2026; PAT at Rs.4.3 billion (21.3% of revenue).
• Net zero debt with Rs.32.5 billion cash — H1 FY 2026-2027 cash generation of Rs.10.1 billion; negligible finance costs.
• Other expenses grew ~38% in Q2 FY 2026-2027 — CFO attributed this partly to operational forex losses and said growth is in line with revenue, with no concerning P&L impact.

Rs.24.4 bn Q2 intake (+52% YoY); base order guidance held despite strength

• Q2 FY 2026-2027 order intake of Rs.24.4 billion, up 52% YoY — vs Rs.16.1 billion in Q2 FY 2025-2026; H1 FY 2026-2027 cumulative intake ~Rs.35.8 billion, up 11% YoY.
• Backlog of Rs.214.4 billion at September 2026 — essentially flat vs Rs.214.6 billion at March 2026; equals more than 3 years of FY 2025-2026 revenue.
• Base order guidance of 70-80 billion for FY 2026-2027 kept unchanged — CFO Sushil Kumar declined to raise the full-year target despite strong monthly order performance.
• Key Q2 wins — 400 kV generator transformer and 420 kV GIS for a 1,500 MW pumped storage hydro project in Maharashtra; 800 kV and 420 kV GIS in Andhra Pradesh; TBCB packages in Himachal Pradesh; export GIS orders across North America, Europe, Middle East and Africa.
• Badmer HVDC (L1 with Power Grid) expected to book in Q3 FY 2026-2027 — management expects a minimum of 2-3 HVDC projects to come in FY 2027-2028, citing a very strong HVDC pipeline.
• Domestic pipeline of TBCB projects built over the last 3-4 months — management expects it to remain strong for at least the next 4-5 months (H2 FY 2026-2027); STATCOM ordering expected to begin in a sizable way in Q4 FY 2026-2027.
• Exports: H1 FY 2026-2027 bookings of Rs.10.4 billion — vs Rs.11.8 billion booked in the entire FY 2025-2026; if the US material RPT (~$151 million, valid till 15 May 2027) closes in H2 FY 2026-2027, FY 2026-2027 exports would show very significant growth.

Rs.3,000 crore RPT largely executed on buy-side; two large sell-side orders in limbo

• Rs.3,000 crore RPT approval (January 2026, Q4 FY 2025-2026) largely buy-side — CFO Sushil Kumar confirmed the buy-side portion (imports of components for HVDC projects from the group company) has been executed as of the Q2 FY 2026-2027 call.
• Two sell-side orders under the January 2026 approval — aimed at securing export orders; as of Q2 FY 2026-2027, one remains on hold while the other is active.
• ~Rs.31 billion related-party approval lapsed at AGM 2026 — for export of high-voltage switchgear components to two related parties in the Middle East and France; the order is on hold from the customer side due to their operational planning delays, and management said it is too early to speculate whether the hold lifts in 6 months, 8 months, or a year.
• US related-party approval of ~$151 million valid till 15 May 2027 — the order (transformers for US data centers, ~Rs.1,500 crore) is in discussion stage; management hopes to conclude it in H2 FY 2026-2027.
• GE Vernova Global booked a $900 million order for its global factories — some orders will flow to the India entity, for which a related-party approval of Rs.1,300 crore has been taken and finalization is underway.
• Smaller related-party inflows are broad-based across geographies — driven by rising investments, stretched supply chains, and factory certifications worked on over the past year now yielding results; two large RPT orders have fallen back under indefinite suspension, characterized as one-offs.

No HVDC revenue in FY 2026-2027; Barmer execution from FY 2027-2028 onward

• No HVDC execution revenue in FY 2026-2027 — the Barmer HVDC order from Power Grid will be executed mainly over the next 2-3 financial years, possibly 4 (from FY 2027-2028 onward); management does not expect significant HVDC contribution even in FY 2027-2028.
• Equipment addressable share of a Rs.20,000 crore HVDC project typically 40-65% — mix varies by line length (an 800 km line vs a 1,200-1,500 km line changes composition).
• HVDC localization largely done by internal definition — transformers, thyristor valves, controls and complete engineering are done in India (vs a scenario where 100% of valves and controls were imported); under the government's localization formula, imported inputs such as CRGO and transformer oil are not counted as localized, and management endorsed no specific 50% or 70% figure.
• Localization framed as a journey — the thyristor valve factory is yet to be commissioned (no timeline given); management cited its gas insulated switchgear factory opened in 2009, initially fully import-dependent, whose local suppliers eventually matured enough to supply GE's global factories.
• 765 kV bushing lead times run more than 15-18 months — most 765 kV bushings are imported due to limited Indian manufacturing capacity; transformer manufacturing takes only 3-4 months, so raw material lead times define delivery timelines.
• Trench acquisition (parent deal) gives better supply control — but management stated it will not by itself shrink delivery timelines, as Trench has its own pipeline and market commitments; the French company acquisition announced 2 days before the call is expected to close in the later part of FY27, with India manufacturing implications too early to comment on.
• Mitsubishi Electric IGBT sourcing is a standard model — for the VSC-based South Old Park HVDC project, management said IGBT sourcing "has no role in defining what gross margin the project will operate"; the complete valve, including design and manufacturing, is done in-house.

Data centers <2% of backlog today; traction expected from Q4 FY 2026-2027 / FY 2027-2028

• Data centers account for less than 2% of the current order backlog — mostly a few products in the 220 kV segment and grid automation (quantified by CFO Sushil Kumar); CEO Sandeep Zanzaria sees no cancellation signals and said reports of data center order cancellations were "news to him."
• India's installed data center capacity at ~1.5 GW as of Q2 FY 2026-2027 — expected to rise to 8-10 GW by 2030, which management noted is not significant compared to the US market and other geographies (India-specific industry context).
• Management expects stronger data center traction starting Q4 FY 2026-2027 or most probably FY 2027-2028 — as many projects are currently on the drawing board; management does not see a significant challenge in India in AI/data center companies' ability to raise capital.
• Current Indian data centers are mostly 200-300 MW facilities at ~220 kV — management expects a significant uptick in the opportunity once larger data centers come up at 400 kV and 765 kV levels (period unspecified).
• Risk flagged: early-delivery pressures — once large data centers start coming in, management expects there will "definitely be pressures" in terms of requests for early deliveries.
• Management framed the sector at a "historic inflection point" — grid expansion/modernization (long-distance HVDC and AC corridors), grid digitalization, and T&D as the backbone of India's energy transition and net-zero ambition.
• GC3 corridor approval recently granted by the government — CFO Sushil Kumar said the company's market guidance remains unchanged, noting a large part of the GC3 corridor is already covered under the electricity plan issued by CEA.

Rs.10 bn capex to execute the backlog; supply chain named the number one risk

• Only Rs.10 billion (Rs.1,000 crore) of factory-expansion capex needed to execute the entire backlog — execution window FY 2027-2028 through FY 2030-2031; management expects significant operating leverage, significant absolute EPS growth on the same capital base, and high ROE over that period.
• ~Rs.10 billion capacity expansion program ~20% incurred as of Q2 FY 2026-2027 — CFO noted more than 90% of investment (period unspecified) goes into existing plants where land is already owned, making capex need lower than other players for similar or higher volumes.
• Factory utilization "pretty high" — above 75% for most factories — management said it will not shy away from investing further capex in India if needed.
• Slight pricing pressure confirmed — CFO Sushil Kumar said pressure is not limited to new orders; on regular high-voltage transformers (excluding HVDC) there is slight price pressure but it is not significant. Ambit Capital's Samir Thakur argued copper up >50% in one year warranted ~15% better order pricing; management did not endorse the 15% figure.
• Supply chain is the number one risk — CEO Sandeep Zanzaria said it remains a challenge driven by high global demand and recurring geopolitical disturbances and warned it "can have a very severe impact on operations."
• Export competition from 4-5 large Indian non-MNC exporters not yet visible — Zanzaria said most announced industry-wide capacity expansion is targeted at the export market, mostly on the transformer side and "not so much" on switchgear, so he does not see significant pressure on domestic prices if those players execute as stated.
• Employee cost growth reflects headcount additions, no one-offs — tied to executing the backlog and >30% YoY revenue growth (FY 2026-2027 onwards) plus annual inflation-linked increments; employee cost is growing slower than revenue.

Mid-20s EBITDA sustained for FY 2026-2027; >30% growth ambition through FY 2030-2031

• Mid-20s EBITDA margin guidance maintained for full FY 2026-2027 — H1 FY 2026-2027 EBITDA above 26%, in line with guidance; management described H1 execution as strong.
• Management believes it can sustain >30% annual growth over the next 3-4 years (FY 2027-2028 through FY 2030-2031) — citing >30% annual revenue growth over the last 3-4 years (through FY 2026-2027) and the Rs.214 billion backlog plus HVDC L1 positions.
• Expectations for FY 2027-2028 to be communicated in due course — management will not share long-range guidance covering HVDC execution over the next 3 to 5 year cycle.
• Three upcoming AC/DC projects (two in Bombay, one in Nathadia) not yet cleared by NCT — tendering/awards expected in FY 2027-2028 ("in 27 only, next year").
• TBCB delivery timelines stretched from 18-21 months to 24-30 months — creating a float that now rests with developers; equipment packages are typically awarded 3-5 months after a developer wins a TBCB project; management said it is difficult to predict how much of the ~Rs.1 lakh crore of HV TBCB projects tendered so far would fructify into equipment orders if decided in FY 2026-2027.
• Many states have expressed that future expansion at 400 kV and 765 kV levels would go the TBCB route — management said it is difficult to quantify a number for FY 2026-2027, as these numbers are tracked more by developers than by the company.
• Kosali HVDC refurbishment: early talks only — Kosali 1 was executed by the company around 2000 or 2003 (more than 25 years ago); the refurbishment order has been given to Power Grid, which has launched discussions with the company, but no order, scope, or timeline has been confirmed.