Nomura has maintained a ‘Buy’ rating on CG Power and Industrial Solutions, while lowering the target price to ₹825 from ₹900, citing short-term margin pressure in its railway business, even as the company reported a beat on overall order inflows.
The brokerage noted that while demand remains strong across core segments like power systems and automation, the railway division dragged overall margins, due to higher input costs and project execution delays. That said, CG Power continues to gain market share in value-added industrial system products, reinforcing its long-term potential.
Nomura said the growth outlook remains intact, supported by capex revival in power infrastructure and industrial automation. However, it tweaked FY26–27 EPS estimates by 1–2%, adjusting for slower-than-expected margin normalization in select verticals.
The firm sees CG Power as well-positioned to ride India’s manufacturing upcycle but expects short-term volatility in profitability as it scales newer segments and navigates execution headwinds.
Disclaimer: The above views are those of the brokerage and not the publication. Investors should consult a certified financial advisor before making investment decisions.
