Power Grid Shares in Focus after Margins Shrink and Profit Slips in Q4

Shares of Power Grid Corporation of India will be in the limelight today, a day after the company reported lower-than-expected earnings for the March quarter. The stock ended 1.4% higher on the National Stock Exchange on Monday. It is currently trading 23% above its 52-week low and 17% below its 52-week high.The power generation company’s consolidated net profit slipped marginally on year, even though revenue for the quarter under review was slightly higher.

Its consolidated net profit came in at Rs 4,142.87 crore in the fourth quarter of FY25, compared to Rs 4,166.33 crore in the year-ago quarter. Revenue for the period was recorded at Rs 12,275.35 crore, against Rs 11,978.11 crore recorded in the corresponding period a year ago.

Higher finance cost during the period weighed on the company’s earnings. The state-owned company’s total borrowings as of March 2025 were over 6% higher than the figure reported as of March 2024.

Also, growth in the Power Grid’s consolidated revenue came largely on the back of growth in its consultancy and telecom segment, which together accounted for just 6.5% of the total revenue. Transmission, the major segment, actually booked slightly lower revenue in Q4 of FY25 as compared to the base quarter.

Overall, the company’s consolidated operating profit margin contracted 300 basis points, while its net profit margin contracted just 100 bps during the March quarter. For FY25, the consolidated net profit was marginally down at Rs 15,521.44 crore as against Rs 15,573.16 crore in the previous financial year. Similarly, revenue for the year also slipped to Rs 45,792.32 crore from Rs 45,843.10 crore in the year ago.

Separately, the board has given in-principle approval to sell entire stake and exit from a joint venture with Torrent Power, Torrent Power Grid Ltd. It also approved the sale of entire stake in Sikkim Power Transmission Ltd., a joint venture between Power Grid and Sikkim Urja Ltd.  

Power Grid has announced a final dividend of Rs 1.25 per share for the financial year ended March. This, along with an interim dividend of Rs 7.75 apiece, the total dividend for the shareholders of the company is Rs 9 a share.