Morgan Stanley described CG Power as a proxy for India’s manufacturing growth story, underpinned by its established position in motors, a strong power systems franchise, and expansion into railways and semiconductors.
The brokerage said the company’s manufacturing capabilities and cash generation profile provide visibility for sustained earnings growth.
The brokerage forecasts a 34% CAGR in profit after tax (PAT) during FY25–FY28, the fastest among its EPC and capital goods coverage universe.
By segment, it expects the industrials business to post a 14% revenue CAGR and 15% EBIT CAGR during FY25–28, while the power systems division is projected to deliver revenue CAGR of 35% and EBIT CAGR of 42%.
In semiconductors, Morgan Stanley projects a peak asset turnover of 1.9x by FY31E.CG Power has also drawn attention in the previous week, following the inauguration of its subsidiary CG Semi’s OSAT (Outsourced Semiconductor Assembly and Test) facility in Sanand, Gujarat.Backed by a proposed investment of Rs 7,600 crore over five years and supported by global partners such as Renesas and Stars Microelectronics, the project marks a significant addition to India’s semiconductor manufacturing capacity.
The G1 facility, which commenced operations last week, has a peak capacity of around 0.5 million units per day, with commercial production targeted for 2026 after customer qualification runs.
Also read: NSE hikes quantity freeze limit for Bank Nifty derivatives to 900 from September 1(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
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