Power Grid Q2 FY27 Earnings Call: Capex Guidance Raised To Rs. 40,000 Cr, Rs. 2.2 Lakh Cr Order Book (POWERGRID)

Power Grid Corporation of India Ltd held its Q2 FY27 earnings call on November 01, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Solid PAT Growth, But Regulatory Headwinds Muted Top Line

• Q2 FY 2026-2027 consolidated PAT up 8% YoY — PBT rose ~6%; standalone PAT up ~7% YoY.
• Transmission operating income grew 7.7% — but effective top-line growth was only ~3% after a −Rs.354 crore impact from the regulatory-asset tariff trajectory and a −Rs.193 crore one-off linked to timing of regulator orders.
• Q2 execution of 981 circuit-km and 14,600 MVA — Koppal–Raichur, Bidar–Maheshwaram, Sikar–Khetri lines plus new Koppal/Bidar substations and 400 kV Bikaner commissioned; H1 FY 2026-2027 totalled 2,600 circuit-km and 25,000 MVA.
• TBCB SPVs Ramgarh-2 and Bidar fully commissioned — all elements complete; post-September 2026, Koppal–Narendra, Koppal–Gadag lines and Gadag 400 kV substation also commissioned.
• Availability at 99.81% with 0.17 trips per line — Srinagar–Dras radial line to Leh tripped 29 October 2026 and was restored in record time at ~11,800 ft and −10°C.
• Receivable days at 10.54 — dues outstanding beyond 45 days down significantly.

Capex Guidance Raised; Capitalization Trimmed

• FY 2026-2027 capex guidance raised to Rs.37,000–40,000 crore — up from Rs.37,000 crore indicated at the previous call; FY 2026-2027 capitalization guided at Rs.25,000–30,000 crore.
• FY 2026-2027 capitalization guidance revised down to Rs.25,000–30,000 crore (from Rs.30,000 crore) — CMD said there is "absolutely no challenge" on equipment supplies; the residual constraint is project fronts to be cleared by state/local administration.
• Transformers secured via bulk procurement — the earlier bottleneck is resolved; management is "very well comfortably placed" on orders for the Rs.2.2 lakh crore work-in-hand, with no challenge in tendering or securing units on time.
• ~5,500 circuit km built in FY 2026-2027 — within ~7,000 circuit km commissioned across India's ISTS over the same period; management framed India's pace as unmatched globally.
• Timeline extension applies to new projects only — the government-approved increase from 18-24 months to 24-30 months has no retrospective applicability; no capex re-phasing impact was quantified.
• Not a single project on hold — CMD said timelines follow TSA schedules rather than fiscal year-ends, delays are recognized by the regulator, and a couple of weeks' slippage would push capitalization only into the next quarter.

Rs.2.2 Lakh Cr Book; Pipeline Dip Offset by Intrastate Opportunity

• Total works in hand ~Rs.2.20 lakh crore — TBCB ~Rs.1.95 lakh crore, RTM ~Rs.0.25 lakh crore; other businesses include data center/storage ~Rs.0.05 lakh crore and smart meters ~Rs.0.04 lakh crore (as stated).
• H1 FY 2026-2027 TBCB wins: 9 ISTS + 2 intrastate projects — ~Rs.8,107 crore total annual tariff (ISTS ~Rs.7,600 crore), including the Barmer HVDC project and the first series of ~8 synchronous condensers.
• Bidding pipeline declined from Rs.1.2 lakh crore in Q1 FY 2026-2027 to Rs.63,000 crore in Q2 FY 2026-2027 — projects, including one HVDC package, moved under bidding; CMD said the pipeline will be pushed forward again when a new HVDC materializes (timing unspecified).
• Rs.1.36 lakh crore of intrastate transmission projects coming up (period unspecified) — over and above the Rs.63,000 crore interstate pipeline, with many states bringing forward projects mostly under the bidding route; Green Energy Corridor-3 (intrastate) ~Rs.1.36 lakh crore plus ~Rs.50,000 crore of BESS, mostly via TBCB, expected to facilitate ~135 GW of RE across states (period unspecified).
• CTIL and CEA have envisaged about 22 HVDC projects totaling about 127 GW — management cited "both domestic and international connectivities," covering the Brahmaputra Basin and evacuation from Khavda and Rajasthan to the mainland (period unspecified); exact timelines not yet in the public domain.
• On two HVDC awards in FY 2027-2028, management said "maybe yes... it could happen" — citing massive generation capacity coming up in Khavda and Rajasthan.
• Analyst cited the government's Rs.9.16 trillion transmission capex plan (FY 2021-2022 to FY 2031-2032) — CMD said he will work out the executed-vs-remaining split and revert; no split was disclosed on the call.

Data Center Launch Imminent; BESS Entry via Section 62 Route

• Manesar pilot data center fully ready — ~1,000 racks, 14 MW, Tier 3 certified, 100% Indian-owned by a government company, MeitY-empanelled sovereign cloud; expected to be commissioned within a few weeks of the call (Q3 FY 2026-2027), though the CMD confirmed readiness without committing to that timeline.
• Second data center planned in southern India — land already secured; management wants to first gain complete operational grip on the pilot before expanding to other locations.
• Regulator modified tariff regulations a couple of months ago — introducing an integrated storage system option under which transmission service providers can develop storage systems via the Section 62 route (RTM mode).
• Clearances secured from northern and western regions — petitions filed before the regulator; management sees good traction for storage under the Section 62/RTM route for grid stability and believes it can open a new window to enter storage systems and scale up to a competitive nature.
• States have embarked on BESS given VGF support from the government — though management noted challenges in making the battery part a reality; it sees good potential in the country.
• Technology indigenization progressing — 220 kV mobile GIS bay deployed; with the Ministry of Power and MeitY, indigenous silicon carbide MOSFET development underway, with ~13,000 SiC power modules expected for deployment in a Power Grid substation (period unspecified).

RoW Hinges on State Adoption; Commodity Swings Two-Way

• Ministry of Power has notified guidelines for market-based compensation to landowners — but land being a state subject, each state government must notify and adopt them; a few states have taken up the new model and are appointing independent valuers.
• No definitive RoW resolution timeline — management expects better traction once state adoption culminates but cautioned there is no "magic wand" that will eliminate ROW issues across the country.
• Competitive intensity rising — an ICICI Securities analyst flagged road EPC players grabbing almost one-fourth of transmission bids by project cost in FY 2026-2027, especially intrastate; CMD said Power Grid's return profile "will not be dictated by other companies" and returns will remain encouraging.
• Commodity inflation cushioned by price variation clauses — responding to a Citi Research question on a hypothetical 20% copper rise in FY 2027-2028, the CMD said cushions are factored into multiple projects; a definitive price variation formula based on predetermined indices applies, and downward movements would be a windfall to PowerGrid.
• Fixed-vs-price-variation supply split not quantified — management declined to disclose the proportion when asked.
• TBCB financials withheld — Director Finance declined to share exact TBCB gross block (as at end of Q2 FY27) and run-rate EBITDA citing competitive reasons; noted the operating income bridge is mainly on account of TBCB as RTA projects come down.
• Pang evacuation scheme re-scoped from HVDC to an AC solution (~Rs.31,000 crore, period unspecified) — due to high-altitude challenges (altitude, ultraviolet and cosmic rays); actively discussed at the recently concluded NCT meeting.

Capex "Much Beyond" Rs.40,000 Cr; Balance Sheet Fully Loaded

• FY 2027-2028 / FY 2028-2029 capex to continue "much beyond" Rs.40,000 crore — CMD declined specific numbers, calling them "very encouraging," aided by a massive HVDC project, synchronous condensers and a couple of intrastate projects; market-rate land compensation will additionally drive capex up, though its quantum is unknown pending clarity.
• Khavda-Nagpur project on track for its four-year timeline (period unspecified) — capex for the first two years not quantified; KPS2 will host HVDC alongside the existing AC substation, with transformers already being supplied and all works progressing as per schedule.
• Funding tied up across instruments — ~¥80 billion JBIC green loan, Rs.10,000 crore SBI term loan, Rs.5,000 crore via UPI (as stated) and Rs.2,000 crore bonds, with more in the offing; debt:equity at 59:41 with headroom for the project pipeline.
• Other income flows strengthened (comparison period unspecified) — interest from subsidiaries Rs.794 crore → Rs.1,201 crore; dividend from subsidiaries Rs.300 crore → Rs.345 crore; JV dividend Rs.24 crore → Rs.60 crore; incentive income declined Rs.159 crore → Rs.98 crore.
• Transmission framed as the "common denominator" for every megawatt — CMD asserted there is no dearth in project quantum; as more renewable energy is injected into the country, transmission systems will be required for evacuation, whether intrastate or interstate.
• Integration demand beyond lines — per CMD, with every state declaring more RE, integration will require synchronous condensers, STATCOMs, batteries and storage systems.