Gold-standard tag for sub-220 kV maker, 12‑month TP implies ~29% upside from CMP
Nuvama Institutional Equities has initiated coverage on Voltamp Transformers with a ‘BUY’ rating and a 12‑month target price of INR 10,200, calling the Vadodara-based company a “gold‑standard transformer manufacturer” up to 220 kV. The brokerage’s initiating note, dated 1 December 2025, values Voltamp at 25x FY28E EPS of INR 406.8 and works off a report CMP of INR 7,888, implying roughly 29% potential upside.
Why Nuvama Is Bullish on Voltamp
The house pitch frames Voltamp as a structural play on transmission-and-distribution plus industrial capex, underpinned by the renewable transition, data centres, EV infrastructure and semicon projects, Nuvama wrote. After relatively muted FY25–FY26E growth, the brokerage expects FY27E EPS to expand 13–15% on the back of an 18% year-on-year revenue lift as new capacity kicks in, it added.
Voltamp’s business model is deliberately focused and diversified with short execution cycles of 8–10 months, aided by the avoidance of large, tender-led projects that can stretch working capital, the note observed. The company services 3,000‑plus customers across 20‑plus industries, limiting concentration risk, while capacity utilisation is currently running at 100%+, according to Nuvama’s analysis.
How Voltamp Protects Its Margins and Returns
A key plank of the thesis is Voltamp’s order selection discipline, which Nuvama says has helped sustain best‑in‑class operating profitability and return ratios in a crowded sub‑220 kV market with 150–200 players. The brokerage highlighted operating margin of 18.9% in FY25 and 18.3% in H1FY26, alongside RoE of 18–20% over recent years, supported by favourable working‑capital terms on chosen orders.
Voltamp also enjoys a premium realisation of about INR 13 lakh per MVA versus an industry average of ~INR 10 lakh, reflecting credibility and selectivity, although peer catch‑up is narrowing this premium and could temper margins, Nuvama cautioned. The brokerage models’ operating margin is easing to around 17% by FY28E amid normalising price discipline across the industry.
Expansion to Drive the Next Leg
Growth is set to be capacity‑led: Voltamp is investing INR 200 crore (fully funded via internal accruals) to add 6,000 MVA at its Jarod (Vadodara) facility, taking installed capacity to 20,000 MVA, the report stated. The new line is slated to come on stream by Q1 FY27E, with a ramp‑up to 60% utilisation in FY27E and to full utilisation thereafter, Nuvama projected.
On forecasts, the brokerage estimates revenue and PAT CAGRs of 17% and 13%, respectively, over FY26E–FY28E, with EPS CAGR of 13% and RoE around 19% across the same horizon. On valuation, Nuvama noted Voltamp trades at about 22x/20x FY27E/FY28E P/E on the report CMP—at a discount to broader capital goods peers that command 30–40x—supporting its positive stance.
Nuvama’s View in Focus
“Voltamp is a ‘gold‑standard’ transformer maker up to 220 kV and a structural play on T&D and industrial capex,” said Subhadip Mitra, analyst, Nuvama Institutional Equities
Nuvama’s Coverage on Voltamp: Key Variables and Risk Factors
Nuvama flagged three swing factors: timely commissioning of the Jarod expansion to 20,000 MVA by Q1 FY27E (from 14,000 MVA today), sustaining current OPM levels (18.9% in FY25 and 18.3% in H1 FY26), and maintaining realisation near INR 13 lakh per MVA, as reported for H1 FY26. Any slippage on these could moderate growth or margins, the brokerage cautioned.
Market context and liquidity are reasonable: at the time of the note, Voltamp had a market capitalisation of about INR 8,000 crore, a 52‑week range of INR 11,548–INR 5,900 and free float of 66.7%, Nuvama disclosed. The brokerage categorised the stock as a “Sector relative Outperformer” in its coverage universe.
Nuvama’s Coverage on Voltamp Transformers: Highlights
- Rating: BUY; 12‑month TP INR 10,200 (25x FY28E EPS)
- Report CMP: INR 7,888; implied upside ~29%
- Capacity: 14,000 MVA now; to 20,000 MVA by Q1 FY27E (Jarod, Vadodara)
- Margins: OPM 18.9% in FY25; 18.3% in H1 FY26; ~17% modelled by FY28E
- Realisation: ~INR 13 lakh/MVA in H1 FY26; premium to industry
- Financials: FY26E–FY28E revenue/PAT CAGR 17%/13%; RoE ~19%
- Free float 66.7%; market cap ~INR 8,000 crore; 52‑week H/L INR 11,548/INR 5,900
Conclusion
Nuvama’s initiation frames Voltamp as a disciplined, capacity‑expanding franchise levered to the T&D and private‑capex cycle, but also flags the need to preserve pricing and margin leadership as competition intensifies. The next 12–18 months—culminating in the Jarod ramp‑up by Q1 FY27E—will be pivotal in validating both growth and profitability assumptions.
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