Domestic brokerage Emkay Research has maintained a ‘BUY’ rating on Genus Power Infrastructures (GPIL) with a target price of INR 550. Currently, Genus Power share price is at around INR 31, implying an upside of ~75%. The brokerage’s stance is backed by the company’s INR 25,200 crore order book and accelerated execution of smart meter projects.

Order Book and Sector Demand

The government’s Revamped Distribution Sector Scheme (RDSS) requires an estimated 310-320 million smart meters. According to management commentary, about 156 million meters have been tendered and 70 million installed across the industry. Genus expects an additional 80-90 million meters to be tendered in FY27, primarily from states like Haryana, Madhya Pradesh, Punjab, and Tamil Nadu.

Backed by this demand, Genus holds an order book of INR 25,200 crore. For context, the company reported a total revenue of INR 4,730 crore in FY26, providing significant revenue visibility for the coming years.

Shift Toward O&M Revenue

Genus is scaling its Advanced Metering Infrastructure Service Provider (AMISP) business through a joint venture with Singapore’s GIC. Genus has invested INR 490 crore in the platform and plans to add INR 6–7 crore over FY27–29.

Management indicated that only 45–50% of the platform’s order book is hardware-linked. The rest comprises Operations & Maintenance (O&M). O&M revenue is projected to grow from INR 150 crore in FY26 to INR 800 – 900 crore annually over the next 2-3 years, establishing a recurring revenue stream.

Genus Power Q4 FY26 Financials and Margin Pressures

Genus Power Q4 FY26 results showed strong revenue growth but a contraction in operating margins:

• Revenue and Profit: Standalone revenue grew 62.7% YoY to INR 1,530 crore. Profit After Tax (PAT) increased 41.2% YoY to INR 180 crore. The company installed 30 lakh meters in Q4, bringing the FY26 total to 87 lakh.
• Margin Contraction: Gross margins fell 467 basis points YoY to 36.0%, bringing the EBITDA margin down to 18.6%.

Emkay noted that the company’s contracts are fixed-price with no raw-material pass-through mechanism. Consequently, the company absorbed the impact of forex volatility and higher costs for components like chips and petroleum. Management has guided for an ~18% EBITDA margin for FY27.

Debt and Working Capital

Net debt increased from Rs 6.1 billion in the previous year to Rs 15.7 billion by the end of FY26. Emkay attributes this to higher short-term borrowings required for project execution.

However, the company’s working capital cycle improved, with days dropping from 343 to 274. Management expects a further 50–75-day reduction in FY27, lowering working capital requirements to ~20% of revenue. With more projects achieving ‘go-live’ status, Emkay projects that the company will become cash-flow positive by late FY27, allowing for debt reduction post-FY28.

Summary of Emkay’s Coverage on Genus Power

Genus Power currently trades at 14x FY27E and 11x FY28E estimated earnings. Emkay values Genus Power’s target price using a Sum-of-the-Parts (SOTP) method. This assigns a 20x P/E multiple to the standalone business based on March-2028 estimated EPS, with additional value derived from its AMISP profitability share.

Moving forward, execution of the current order book, managing raw material costs, and scaling the targeted INR 500 crore export business will be the primary drivers for the stock.

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Rajat Bhati has a strong technical background and 5 years of experience in the stock market. He focuses on equity research, technical analysis, IPO valuations, and risk management, helping investors make clearer, data-backed decisions. Today, he works full-time to educate people about the opportunities in IPO market.