Thermax Bets On Green Energy, But PL Capital Cautions On Execution Risks — Maintains 'Hold' Rating

The management remains optimistic with a minimum of ~10-11% revenue growth CAGR over the next five years with better margins supported by better execution in H2 FY26. Thermax’s exposure to the USA tariffs remain below ~1% as the chemical business is exempt..NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..PL Capital Report.We visited Thermax Ltd.’s water and waste Solutions plant in Pune and engaged with top management to discuss the financial and operational performance along with future growth and profitability outlook. The management remains optimistic with a minimum of ~10-11% revenue growth CAGR over the next five years with better margins supported by better execution in H2 FY26. Company’s exposure to the USA tariffs remain below ~1% as the chemical business is exempt. Emerging segments, including Green Hydrogen, Green Ammonia, and Sustainable Aviation Fuel (SAF), are expected to provide new avenues of growth for Industrial Infra and Industrial Products. Despite the slower than anticipated expansion of Chemicals business, it is expected to sustainably grow driven by company’s foray into specialty chemicals. The management aims to achieve 1 GW operational capacity in Green Solutions, post which may dilute its stake. Management remains risk averse with selective order booking (orders below Rs 5.0 billion) and focus on core capability building for long-term sustainable growth. Execution challenges will remain a key monitorable in the short term. However, in the long term, Thermax is well placed to gain from increasing thrust on energy transition & de-carbonization led by its-sustainable green industrial solutions in bioenergy, heating and cooling, chemicals and water, technical expertise, and prudent working capital management. .The stock is currently trading at PE of 50.6x/44.7x on FY26/27E. We maintain our ‘Hold’ rating valuing the core business at a PE of 40x Mar’27E (same as earlier) arriving at a SoTP-derived TP of Rs3,633 (same as earlier)..Click on the attachment to read the full report:.VRL Logistics Can Rally 29% Says Motilal Oswal Maintaining 'Buy' — Check Target Price.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Thermax Bets On Green Energy, But PL Capital Cautions On Execution Risks — Maintains 'Hold' Rating

While long-term prospects look promising due to energy transition tailwinds, PL Capital flags execution delays as a near-term risk

NDTV Profit

NDTV Profit

Follow Us

DISCOVER US FASTER

DOWNLOAD THE APP