India’s Transmission and Distribution (T&D) sector is emerging as one of the biggest beneficiaries of the country’s expanding power infrastructure and energy transition plans.
Driven by rising electricity demand, renewable energy additions and grid modernisation, the sector is witnessing strong order inflows, improving execution and higher profitability.
T&D continues to outperform
Power transmission and distribution remains the strongest segment within the capital goods space.
According to sector data, high-voltage T&D companies reported:
- Order inflow growth of 51.8% year-on-year.
- Revenue growth of around 36-37%.
- EBITDA margin expansion of 220 basis points to 19.9%.
Higher execution levels, favourable pricing and operating leverage have supported profitability.
Record order books are also providing visibility for future growth.
Why the sector is seeing strong demand
Several structural factors are supporting the sector:
- Expansion of renewable energy capacity.
- Grid modernisation requirements.
- Rising electricity consumption.
- Thermal power additions.
- Investments in transmission infrastructure.
₹7.93 trillion transmission capex pipeline
The Central Electricity Authority (CEA) has outlined a roadmap to achieve nearly 900 GW of non-fossil fuel capacity by FY36.
Meeting that target would require transmission investments of around ₹7.93 trillion.
The plan extends the earlier ₹9.2 trillion transmission programme for FY22-FY32 and provides long-term visibility for:
- Transformer manufacturers.
- GIS equipment suppliers.
- HVDC equipment companies.
- Transmission EPC players.
Although Power Grid Corporation of India Ltd (PGCIL) has guided for a capex CAGR of about 6% between FY26 and FY28, ordering activity and bid pipelines suggest additional opportunities could emerge.
HVDC projects offer a new growth avenue
High Voltage Direct Current (HVDC) projects are expected to become a major growth driver.
India could see 15-20 HVDC projects over the coming years.
Each project is estimated to be worth ₹15,000-20,000 crore.
According to industry estimates:
- Product supplies could account for 40-50% of project value.
- Ten proposed HVDC corridors linked to Rajasthan are under consideration.
- Six additional corridors are being explored under the Brahmaputra transmission plan.
Rising power demand supports investments
Electricity demand in India continues to grow steadily.
To meet annual demand growth of 6-7%, the country may require:
- 35-40 GW of renewable capacity additions every year.
- 10-15 GW of thermal capacity additions annually.
These additions will require significant investments in transmission infrastructure, supporting the broader T&D ecosystem.
Private capex revival showing early signs
Outside the power sector, industrial activity is gradually improving.
Non-power industrial companies reported:
- Revenue growth of around 10%.
- Order inflow growth of 35.7-36%.
Demand is improving across several sectors, including:
- Metals.
- Oil and gas.
- Data centres.
- Semiconductors.
- Electric vehicles.
- Electronics manufacturing.
Meanwhile, the RBI’s capacity utilisation level reached 77.7%, the highest in a decade.
Higher utilisation levels are often seen as an indicator of future capital expenditure.
Why T&D remains the standout theme
Within the broader capital goods sector, transmission and distribution currently offers the strongest visibility.
Key growth drivers include:
- Renewable energy integration.
- Grid expansion.
- HVDC projects.
- Rising power consumption.
- Healthy order books.
- Improving margins.
Outlook
India’s T&D sector continues to benefit from structural changes in the power industry.
Strong ordering activity, expanding execution and a multi-year transmission capex pipeline are providing long-term growth visibility.
While signs of a broader private capex cycle are beginning to emerge, transmission and distribution remains one of the most visible growth themes within the capital goods sector.
Key numbers
- Order inflow growth: 51.8%
- Revenue growth: 36-37%
- EBITDA margin: 19.9%
- Margin expansion: 220 basis points
- Transmission capex opportunity: ₹7.93 trillion
- Non-fossil power target: 900 GW by FY36
- Potential HVDC projects: 15-20
- Value per HVDC project: ₹15,000-20,000 crore
- RBI capacity utilisation: 77.7%
TL;DR:
India’s transmission and distribution sector is benefiting from rising electricity demand, renewable energy expansion and a ₹7.93 trillion capex pipeline. Strong order growth and emerging HVDC opportunities are supporting a multi-year growth outlook.
AI summary:
- High-voltage T&D companies reported 51.8% growth in order inflows.
- India may require ₹7.93 trillion in transmission investments.
- The country could see 15-20 HVDC projects in coming years.
- Rising power demand is supporting transmission spending.
- T&D remains the strongest theme within the capital goods sector.
