Power Grid Corp Q2 results: Net profit rises 0.3% YoY to ₹3,793 crore; company declares ₹4.5/share interim dividend

Power Grid Corporation, a Maharatna Central Public Sector Undertaking (CPSU) and the largest electric power transmission company, reported a weaker-than-expected performance for the second quarter of financial year 2025 (Q2 FY25) on Wednesday, November 6.

The company posted a consolidated revenue of ₹11,277 crore for Q2 FY25, marking a marginal increase of 0.1% compared to ₹11,267 crore posted in the same period last year. Revenue from the transmission segment, which constitutes 99% of the company's total revenue, stood at ₹11,197 crore, up from ₹10,991 crore in Q2 FY24.

The operating profit for the quarter stood at ₹9,701 crore as compared to ₹9710 crore in Q2 FY24. The EBITDA margin came in at 86%, slightly below Street expectations of 87.4%. The company had posted an EBITDA margin of 87% in the June quarter.

Finance costs for the quarter increased by 20%, rising to ₹2,441 crore from ₹2,038 crore in Q1 FY25. Meanwhile, consolidated net profit in Q2 FY25 stood at ₹3,793 crore, reflecting a modest 0.3% increase from ₹3,781 crore posted in the same period last year.

The company’s board of directors approved an interim dividend of ₹4.50 per equity share of ₹10 each. "1st Interim Dividend will be paid to the Members on Wednesday, 4th December 2024. Further, as intimated earlier, the record date for the purpose of payment of dividend shall be Thursday, 14th November, 2024, the company said in its regulatory filing.

Stock down 13% from recent highs

The stock has experienced profit booking in recent months, leading to a 13.11% decline to ₹318.45 from its recent peak of ₹366.20 per share. Between May 2020 and September 2024, the stock saw a remarkable one-way surge, posting a stellar 302% gain.

Earlier in September, domestic brokerage firm Motilal Oswal initiated coverage on the stock with a ‘buy’ rating and set a target price of ₹425. The brokerage highlighted India’s ambitious goal to expand its renewable energy capacity to 500 GW by 2030, along with the upcoming battery storage and pumped hydro projects, and the nation’s aspirations to participate in global energy initiatives like ‘One World, One Grid’ as key growth drivers for the company.

In April, global brokerage firm Goldman Sachs also initiated coverage on the stock with a target price of ₹355 per share. It estimates that India’s power transmission capital expenditure will exceed USD 500 billion by FY50, accounting for about 30% of the total energy transition capital outlay.

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