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Hitachi Energy India Limited announces Q3FY25 results: Solid all-round performance, robust order backlog
HIGHLIGHTS
Orders post high triple-digit YoY growth on the back of large HVDC order
PAT grows nearly 5x on a low base
Double-digit Op EBITDA margin
Highest-ever order backlog of INR 18,994.4 crore
Bengaluru, January 29, 2025 – Hitachi Energy India Ltd. announces results for October to December 2024.
**The company evaluates the profitability based on Operational EBITDA. Operational EBITDA represents income from operations excluding (i) amortization expense on intangibles, (ii) restructuring and restructuring-related expenses, (iii) non-operational pension cost, (iv) gains and losses from the sale of businesses, acquisition-related expenses, and certain non-operational items, (v) foreign exchange/commodity timing differences in income from operations consisting of (a) unrealized gains and losses on derivatives (foreign exchange, commodities, embedded derivatives), (b) unrealized foreign exchange movements on receivables/payables (and related assets/liabilities) and (vi) Depreciation expenses on tangibles assets.
As nations and organizations steer towards their net-zero targets, energy investments are gaining momentum across verticals – utilities, industries, transport & infra. Over the years, we at Hitachi Energy India Limited have pre-empted this growth phenomenon and have been strengthening our manufacturing capabilities and the quarter’s positive trending performance reflects returns on localization, expansion and talent development.
Orders
The company reported its highest-ever quarterly order of INR 11,594.3 crore in the period ending 31 December 2024. The surge can be primarily attributed to a large high-voltage direct current (HVDC) order to transmit renewable energy from Khavda in Gujarat to Nagpur, Maharashtra. In addition, the transmission segment (not incl HVDC order) led the order book momentum, with power quality and substation projects. Other major contributing segments were transportation followed by industries and data centers. In the first-of-its-kind, the consulting team entered into a capacity reserve agreement for nearly a year for renewable studies with a customer in decarbonization space.
Excluding the one-time large HVDC order, share of exports grew to over 40% of total orders in Q3FY25, with power quality, substation & renewable orders from Australia, Indonesia, Canada, Croatia, Azerbaijan, etc. Similarly, service segment constituted 11% of total orders (excl HVDC). Key orders include multiple market studies (for grid and renewables) and service agreements for lifecycle management.
At the close of December 31, 2024, the Company recorded its highest-ever order backlog of INR 18,994.4 crore, providing revenue visibility for the coming quarters.
Revenue
Revenue was up 31% YoY at INR 1672.4 crore in the October-December 2024 quarter, on the back of execution mix and improving operational efficiencies. Concerted focus on collections have borne fruit, which in addition to the advance from HVDC project has led to solid cash position and the company becoming debt-free as of December 31, 2024.
Profit
In addition to favorable execution mix, notional forex exchange gains on export order delivery pushed profit before tax up four times YoY to INR 184.1 crore. Profit after tax is up nearly five times YoY from a low base, at INR 137.4 crore. Operational EBITDA for the third quarter stood at INR 168.9 crore, resulting in a double-digit margin of 10.1%, reiterating the Company’s continuous efforts toward improving margins and enhancing overall operational efficiency.
Outlook
Despite some downward recalibration of growth estimates for the short term, analysts peg the Indian economy is likely to grow over the coming years. In conjunction, India’s electricity demand is set to exceed 700 GW by 2047¹, 2.5 times the current levels. To meet this voluminous requirement, and it’s 2030 targets, the country needs to scale up its renewable capacity beyond 50 GW annually. This entails strengthening grid infrastructure and developing localized supply chains, in addition to adding generation capacity. Along with transmission infra buildup, focusing on high-performance sectors like energy storage, green hydrogen, and industries will add more momentum to the overall market growth. Thus, strategic investment in clean energy, transformative infrastructure, and digital innovation will help India meet its energy targets – mid and long-term- to achieve a sustainable energy future for all.
About Hitachi Energy
Hitachi Energy is a global technology leader that is advancing a sustainable energy future for all. We are advancing the world’s energy system to be more sustainable, flexible and secure and we collaborate with customers and partners to enable a sustainable energy future – for today’s generations and those to come. Hitachi Energy has a proven track record and unparalleled installed base in more than 140 countries, serving customers in utility, industry, transportation, data centers and infrastructure sectors. With innovative technologies and services including the integration of more than 150 gigawatts of HVDC links into the power system, we help make the energy value chain more efficient, making electricity more accessible to all. Together with stakeholders across sectors and geographies, we enable the digital transformation required to accelerate the energy transition towards a carbon-neutral future. Headquartered in Switzerland, we employ around 45,000 people in 60 countries and generate business volumes of around $13 billion USD.
In India, Hitachi Energy operates under the legal entity name Hitachi Energy India Limited and is listed on the National Stock Exchange of India Limited (NSE) and BSE Limited (BSE) as POWERINDIA, Scrip code 543187.
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About Hitachi, Ltd.
Hitachi drives Social Innovation Business, creating a sustainable society through the use of data and technology. We solve customers' and society's challenges with Lumada solutions leveraging IT, OT (Operational Technology) and products. Hitachi operates under the 3 business sectors of “Digital Systems & Services” – supporting our customers’ digital transformation; “Green Energy & Mobility” – contributing to a decarbonized society through energy and railway systems, and “Connective Industries” – connecting products through digital technology to provide solutions in various industries. Driven by Digital, Green, and Innovation, we aim for growth through co-creation with our customers. The company’s revenues as 3 sectors for fiscal year 2023 (ended March 31, 2024) totaled 8,564.3 billion yen, with 573 consolidated subsidiaries and approximately 270,000 employees worldwide. For more information on Hitachi, please visit the company's website at https://www.hitachi.com.