Quality Power Shares at 88x PE: Is Its ₹1,945 Cr Order Book and 20% Growth Enough to Justify the Valuation?
The article outlines the valuation and whether the outlook is supportive for the company, which is an Indian publicly listed manufacturer specializing in high-voltage electrical equipment and advanced power quality solutions for grid connectivity and the energy transition
With a market capitalization of Rs 11,802 crore, Quality Power Electrical Equipments Ltd’s share is currently trading at Rs 1,524 per share, up by 0.3 percent from its previous close. The stock of the company gave a return of 44 percent over the last year, and it trades at a P/E of 88x compared to the industry P/E of 34.6x.
About the Company
Quality Power Electrical Equipment Limited is an Indian multinational company engaged in high-voltage electrical equipment, grid connectivity solutions, and power quality systems. Founded in 2001, the company provides products used in power transmission, grid stability and renewable energy integration.
The company has a global presence across more than 100 countries and serves over 210 clients, including GE T&D India, Hitachi Energy, Siemens and PGCIL. It also operates accredited testing and research facilities for high-voltage equipment.
How much money did the company make in Q1 FY27?
On a QoQ basis, Revenue declined to Rs 256.4 crore in Q1 FY27 from Rs 309.8 crore in Q4 FY26, registering a 17.2 percent decline QoQ. EBITDA increased to Rs 72.5 crore from Rs 59.3 crore, up 22.3 percent QoQ, while EBITDA margin improved to 28.3 percent from 19.1 percent. PAT increased to Rs 54.5 crore from Rs 50.6 crore, up 7.7 percent QoQ, with PAT margin improving to 21.3 percent from 16.3 percent.
YoY Performance: Revenue increased to Rs 256.4 crore in Q1 FY27 from Rs 194.1 crore in Q1 FY26, registering 32.1 percent growth YoY. EBITDA rose to Rs 72.5 crore from Rs 48.4 crore, up 49.8 percent YoY, while EBITDA margin improved to 28.3 percent from 24.9 percent. PAT increased to Rs 54.5 crore from Rs 37.1 crore, up 46.9 percent YoY, with PAT margin improving to 21.3 percent from 19.1 percent.
Order Book Status
The company reported a consolidated order book of Rs 1,945 crore, equivalent to around 1.9 times last year’s revenue. The order book stood at Rs 801 crore for Endoks, Rs 585 crore for Mehru, Rs 553 crore for Quality Power standalone, and Rs 6.5 crore from other entities. Management said demand remains strong across its businesses.
Endoks is the company’s subsidiary focused on power electronics, STATCOM, SVC, grid automation and energy storage solutions, including BESS and PCS. Mehru is the company’s high-voltage instrument transformer business, supplying equipment used in power transmission and grid applications. The existing consolidated order book is expected to be executed over around 15 months, providing visibility for near-term revenue. During Q1 FY27, the company also announced Rs 104.9 crore of key orders.
This included Rs 48.3 crore of high voltage reactors from Quality Power for a US data center project, expected to be executed over around 12 months. Endoks received a Rs 40.9 crore FACTS system and equipment order from Japan, while Mehru secured Rs 15.7 crore of 400 kV instrument transformer orders from Hitachi Energy India, with execution expected over around 12 months.
But does the outlook justify the valuation?
Strong Order Book Visibility : Quality Power ended Q1 FY27 with a Rs 1,945 crore consolidated order book, equivalent to around 1.9 times FY26 revenue. With the existing order book expected to be executed over around 15 months, this provides visibility for near-term revenue growth.
20% Growth Guidance : Management retained its 20 percent FY27 revenue growth guidance, despite Q1 FY27 revenue growing 32.1 percent YoY. The company said it may review the guidance around Q3 FY27, while continuing to maintain a cautious approach toward future growth expectations.
EBITDA Margin : Management expects group EBITDA margins to remain around 20 percent or in the high teens, with standalone margins around 20 percent. Mehru’s margin guidance stands at around 18 percent, while Endoks’ existing STATCOM and SVC products operate at around 25 percent margins. The key will be maintaining these margins as newer businesses such as BESS scale up.
New Growth Drivers : The company has several potential growth drivers, including BESS, HVDC, the new Sangli facility, and the Winwin acquisition. Endoks currently has a BESS pipeline of around USD 60 million, with another USD 40 million expected over the next 12 months, while the new capacity could support higher revenue as utilisation improves.
Conclusion
Overall, the company has multiple growth levers through its order book, capacity expansion and newer businesses. However, the valuation also places greater importance on execution, revenue growth and margin sustainability going forward.
The Rs 1,945 crore order book and 20 percent FY27 growth guidance provide visibility, but whether they support the current 88x P/E will depend on how quickly the company converts its order pipeline and new capacity into sustained earnings growth.