 "Sensex, BSE, stock markets")
Shares of Transformers and Rectifiers (India) (TRIL) hit a record high of Rs 331, as they zoomed 20 per cent on strong order book position of Rs 2,572 crore as on December 31, 2023 (Q3FY24). The company said inquiries of domestic orders worth Rs 4,256 crore and export orders worth of $127 million were under negotiation.
The company won export orders for one of the largest Electric Arc Furnace Transformer (220MVA). TRIL will be the third company in the world to manufacture this kind of transformer.
TRIL is engaged in manufacturing of electrical transformers and reactors, which find application in power transmission & distribution and industrial/commercial sectors.
In the past six months, the stock price of TRIL has zoomed 283 per cent, as compared to near 7 per cent rise in the S&P BSE Sensex.
The transformer market is poised for significant growth, particularly as federal investments in the development and implementation of renewable sources of energy increase, underpinning the ongoing support to create better and more efficient electricity infrastructure.
Several key market trends are expected to continue driving growth, including aging electrical infrastructure, grid hardening and modernization initiatives, expanding renewable distributed energy, and increasing demand from high growth sectors, among many others.
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Pent up demand from the industrial expansions backed by pickup in capex is leading to higher consumption of power in India leading to improved order book of transformer manufacturers.
In railways; with higher roll out of fast speed trains, metro's, freight corridors, TRIL is at an advantageous position to contribute to the demand. As regards to green energy; for transmitting energy from solar parks to the grid higher voltage transformers are required where TRIL has necessary facilities and capabilities. The replacement demand expected from Steel mills using glass furnaces will transition to Arc furnace transformer because of pollution regulations and due to elongated industry downturn, many players are either out of business or consolidated, Chinese players exited which has in-turn benefitted TRIL, the company said.
TRIL in an investor presentation said, over the last 9 years, significant strides have been made in enhancing power generation capacity, expanding access to electricity, promoting renewable energy, and implementing innovative policies.
Installed renewable generation capacity posted a CAGR of 14.58 per cent between FY16 and FY23. The country plans to reach 450 GW of installed renewable energy capacity by 2030, with 280 GW (over 60 per cent) expected from solar power. The ambitious target of 450 GW will provide investment opportunities worth US$ 221 billion by 2030, the company said.
Strong demand from high-growth end markets, such as technology and data centers, electric vehicle (EV) charging networks, and renewable energy will place additional stress on grid capacity and resiliency, and require new, modern transformers. Indian Railways moving towards high speed trains had led to increased demand of transformers from 66 kV to 133 kV. Further, demand anticipated from freight corridors, metros, etc.
