- The Indian stock market has seen significant expansion in the past year, with power-related stocks, such as Hitachi Energy India, gaining substantial attention.
- Hitachi Energy India’s shares have seen an impressive gain of 144% in the past year, driven by the robust increase in power demand within the country.
- Global brokerage firm Goldman Sachs has initiated coverage on Hitachi Energy, highlighting the company’s strategic positioning within India’s energy transition.
Hitachi Energy India’s stock has seen a remarkable rise in the past year, driven by robust power demand in India. This article delves into the company’s performance and future prospects.
Impressive Stock Performance
Over the past year, shares of Hitachi Energy India have risen from ₹3,725 each to ₹9,084, marking an impressive gain of 144%. The stock has consistently performed well, with 10 out of the last 12 months ending with gains, including a substantial 38% increase in April. From its March 2020 low of ₹680, the stock has soared by 1235%.
Expansion Amid Rising Power Demand
Hitachi Energy is planning to open more global capability centers in India to expand local operations, amid growing energy demand and a push to scale up renewable energy generation in the country. “We are looking at Hyderabad for our GCC and also looking at Pune. It might take six months to one year,” said Venu Nuguri, the managing director and CEO of the company’s India unit.
Brokerage View
On April 18, Goldman Sachs initiated coverage on Hitachi Energy, emphasizing the company’s strategic positioning within India’s energy transition. The brokerage identified several factors driving Hitachi Energy’s growth potential, including grid digitalisation, a global shortage of transmission equipment, and the diversification of the global supply chain. Goldman Sachs gave a ‘buy’ rating for the stock with a target price of ₹8,250 per share.
Promising Opportunities
With the ongoing growth trajectory of the Indian economy, there’s an anticipated surge in energy consumption. In the current fiscal year, the market has already witnessed the initiation of 18 power transmission projects, presenting promising prospects for investment. Power consumption in India exhibited a notable year-on-year increase, reaching 1,221.15 billion units (BU) during the April-December period of the previous fiscal year.
Conclusion
Given the robust growth in India’s power demand and the strategic positioning of Hitachi Energy India, the company’s stock presents promising prospects for investors. With the ongoing expansion of the Indian economy and the anticipated surge in energy consumption, the development of a robust and adaptable energy infrastructure becomes imperative, presenting further opportunities for companies like Hitachi Energy India.
