TD Power margin rebounds to 19% as costs lag revenue growth
Management said FY27 guidance was raised to Rs 2,600 cr, while quarterly order inflow exceeded Rs 700 cr.
Filed 11 Aug 2026, 17:17 IST · after market close · TD Power Systems Ltd (TDPOWERSYS)
Key takeaways
- Consolidated operating margin rose 2.39 percentage points sequentially to 19.00% as expenses grew slower than revenue.
- Revenue grew 72.10% YoY while net profit increased 72.34%, with other income contributing only 2.24% of pre-tax profit.
- Management said FY27 guidance was upgraded to Rs 2,600 cr after quarterly order inflow exceeded Rs 700 cr.
Price around the results
Revenue growth lifts Q1FY27 earnings
TD Power Systems reported consolidated Q1FY27 revenue growth of 72.10% YoY and 8.63% QoQ, with net profit rising 72.34% and 19.53%, respectively. Operating profit grew faster than revenue in both comparisons, helped by expenses growing slightly slower than sales. Lower interest expense also supported pre-tax profit, falling 54.76% YoY and 32.14% QoQ.
Lower cost growth restores operating leverage
Expenses grew 71.06% YoY against 72.10% revenue growth, lifting operating margin by 0.49 percentage points; sequentially, expenses rose 5.51% against 8.63% revenue growth, widening margin by 2.39 percentage points. Other income accounted for only 2.24% of pre-tax profit, so earnings were not materially dependent on non-operating income. The tax rate rose 0.48 percentage points YoY, rather than flattering profit, but fell 0.68 percentage points QoQ.
Margin breaks a four-quarter slide and stays above peers
Operating margin had declined from 18.80% in Q4FY25 to 16.61% in Q4FY26 across four consecutive quarters, before recovering to 19.00% in Q1FY27. The latest margin was 4.98 percentage points above the 14.02% median for 107 Industrials peers that had reported the quarter. This makes the sequential improvement more significant than the modest 0.49-percentage-point YoY gain.
Management points to demand and execution as the focus
Management said it was seeing very strong demand across all generator-business verticals and that order inflow had exceeded Rs 700 cr per quarter. It also said this pace was putting pressure on execution and that the company was positioned to deliver close to the inflow rate. Management said FY27 guidance had been upgraded to Rs 2,600 cr, while the company expects small and mid-size hydro order inflow to recover in coming quarters.
No immediate market reaction after the filing
The results were filed after market close, so there is no same-day market reaction to assess. After its last eight results, the stock rose on all eight occasions, with a median absolute move of 7.77%, providing a consistently positive but sizeable historical response pattern.
Q1FY27 at a glance
Consolidated figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹640 cr | ₹589 cr | +8.63% | +72.10% |
| Other income | ₹3 cr | ₹8 cr | -67.57% | -34.01% |
| Expenses | ₹518 cr | ₹491 cr | +5.51% | +71.06% |
| Operating profit | ₹122 cr | ₹98 cr | +24.30% | +76.71% |
| Operating margin (%) | 19.00% | 16.61% | — | — |
| Interest | ₹0 cr | ₹0 cr | -32.14% | -54.76% |
| Depreciation | ₹7 cr | ₹7 cr | +3.02% | +43.49% |
| Profit before tax | ₹117 cr | ₹99 cr | +18.43% | +73.45% |
| Tax | ₹31 cr | ₹27 cr | +15.43% | +76.67% |
| Net profit | ₹86 cr | ₹72 cr | +19.53% | +72.34% |
| EPS (₹) | ₹5.52 | ₹4.62 | +19.48% | +71.96% |
Operating margin of 19.00% compares with a Industrials sector median of 14.02% across 107 peers that have reported Q1FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
Guidance & outlook
- TDPS expects strong demand across all generator-business verticals.
- Order inflow has exceeded Rs. 700 crores per quarter, and TDPS expects to deliver close to that rate.
- TDPS says the outlook for FY27 and FY28 is strong and has upgraded FY27 guidance to Rs. 2,600 crores.
- The company expects small and mid-size hydro order inflow to recover in coming quarters.
- Further high-volume genset programmes are indicated for CY-2027.
Expansion
- TDPS set up a larger, modern second manufacturing unit in 2011.
New orders
- TDPS secured multiple orders from leading turbine OEMs across steel, cement and sugar industries, including projects in Africa and the Middle East.
- TDPS secured the hydro segment's largest order for four 16 MW vertical hydro generators for a hydropower project in Africa.
New initiatives
- TDPS implemented advanced automation and robotics in manufacturing to improve efficiency, accuracy and consistency.
- TDPS transformed its manufacturing facility by replacing conventional machinery with precision robotics and need-based automation.
Problems & risks
- The current order-inflow rate puts pressure on execution.
What to watch
- Whether operating margin holds above 19.00% after the sequential 2.39-percentage-point rebound.
- Quarterly order inflow versus the above-Rs 700 cr rate cited by management.
- Whether the tax rate stays near 26.18% without other income rising from its 2.24% share of pre-tax profit.