- Shares of Hitachi Energy India rose 1% after Macquarie initiated coverage with Outperform rating
- Macquarie set a 12-month price target of Rs 38,500, implying 15.7% upside from last close
- Hitachi Energy leads in HVDC projects with highest order backlog among listed peers
Shares of Hitachi Energy India rose 1% in morning trade on Thursday after Macquarie Equity Research initiated coverage on the stock with an Outperform rating and a 12-month price target of Rs 38,500, implying an upside of about 15.7% from the previous closing price of Rs 33,273.
The brokerage values the stock at 70x two-year forward EPS (earnings per share), a premium multiple it says is justified by Hitachi Energy India's leadership in high-voltage direct current projects, the highest order backlog among listed peers, and its positioning as a beneficiary of both domestic grid investment and data centre capex.
"With the highest order backlog amongst peers, Hitachi Energy provides multi-year visibility on revenue and earnings growth," Macquarie analyst Rahul Gajare said in the note.
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Gajare notes that the company's HVDC franchise covers both line commutated converter and voltage source converter technologies, strengthening its competitive position in future bids. India's HVDC capacity is projected to nearly double by FY32, with two projects already under execution and a strong pipeline ahead.
Hitachi Energy has an upside of around 15% from current levels, according to Macquarie
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Revenue is forecast to grow from Rs 81.5 billion in FY26 to Rs 196.8 billion by FY29. Adjusted EPS is seen rising from Rs 233.8 to Rs 621.4 over the same period. A Rs 20 billion post-QIP capacity expansion aligns with what Macquarie describes as a 2030 strategic growth roadmap targeting higher localisation and a wider product offering.
The brokerage expects a scaling high-margin service business to support overall profitability as the installed base grows.
On valuations, the stock trades at 142x FY26 adjusted PE, declining to 53.5x by FY29. ROE is seen improving from 22.2% in FY26 to 27.7% by FY29. Macquarie also flags faster-than-expected HVDC order wins and export momentum as the key near-term catalysts for the stock.
Out of 19 analysts tracking the company, eight maintain a 'buy' rating, six maintain a "hold", and five maintain a "sell" rating, according to Bloomberg data. The average 12-month consensus price target of Rs 35,059 implies an upside of 4.7%.
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