Power Grid Shares Surge 7% as Company Raises FY26 Capex Guidance to ₹32,000 Crore

Power Grid shares jump 7% after the PSU raises FY26 capex guidance to ₹32,000 crore, highlighting strong execution, growth visibility, and power sector momentum.

Power Grid Stock Rallies on Strong Growth Signal

Shares of Power Grid Corporation of India Ltd. (PGCIL) witnessed a sharp rally of over 7% in early trade after the company announced a significant upward revision in its FY26 capital expenditure (capex) guidance. The state-owned power transmission major now expects to spend ₹32,000 crore in FY26, compared to its earlier estimate of around ₹28,000 crore.

The announcement was positively received by investors, with the stock emerging as one of the top gainers on the NSE and BSE. Market participants see the higher capex guidance as a strong indicator of robust project execution, healthy order inflows, and long-term growth visibility.

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Power Grid Shares Surge 7% as Company Raises FY26 Capex Guidance to ₹32,000 Crore

Why Power Grid Raised Its FY26 Capex Target

During a recent investor interaction, Power Grid’s management highlighted that project execution has gained momentum, prompting the company to revise its capital spending outlook for the ongoing financial year.

According to the company:

FY26 capex guidance increased to ₹32,000 crore
Earlier guidance stood at approximately ₹28,000 crore
Actual capex till January FY26 was already nearing ₹29,000 crore

The revised estimate suggests that Power Grid expects accelerated commissioning of transmission projects, especially those linked to renewable energy evacuation and interstate power corridors.

Power Grid Corporation shares surge after FY26 capex guidance raised to ₹32,000 crore — Power Grid Corporation of India boosts investor confidence after announcing a higher capital expenditure plan for FY26, signalling faster execution of transmission projects.

Focus on Transmission Expansion and Renewable Integration

Power Grid plays a critical role in India’s electricity ecosystem, operating more than 1.75 lakh circuit kilometres of transmission lines and a vast network of substations across the country.

The additional capex will primarily be deployed towards:

High-capacity interstate transmission systems
Green energy corridors for solar and wind power evacuation
Grid strengthening projects to support rising power demand
Modernisation and digitalisation of existing infrastructure

With India aggressively expanding renewable capacity, Power Grid’s transmission assets are becoming increasingly vital for maintaining grid stability and reliability.

Market Reaction: Why the Stock Jumped 7%

The sharp rise in Power Grid’s share price reflects renewed investor confidence for several reasons:

Better-than-expected execution: Raising capex guidance mid-year signals that projects are progressing faster than planned.
Strong earnings visibility: Transmission projects offer regulated, long-term returns with predictable cash flows.
Policy support: Government focus on infrastructure and power sector reforms continues to benefit PSU utilities.

Brokerages believe that higher capex today could translate into higher regulated equity base and stable returns over the coming years.

Recent Financial Performance Adds Confidence

Power Grid’s latest quarterly results have further strengthened its investment case. In Q3 FY26, the company reported:

Year-on-year growth in net profit
Steady increase in transmission revenue
Healthy operating margins
Strong cash flow generation

The PSU also announced an interim dividend, reinforcing its reputation as a reliable dividend-paying stock in the utilities space.

For long-term investors, this combination of earnings stability and regular dividends makes Power Grid an attractive defensive play.

Power Sector Tailwinds Support Long-Term Growth

India’s power demand continues to rise due to:

Rapid urbanisation
Expansion of manufacturing and data centres
Electric vehicle adoption
Increasing per-capita electricity consumption

At the same time, the government has set ambitious renewable energy targets. This creates sustained demand for new transmission lines, substations, and grid upgrades, directly benefiting companies like Power Grid.

Experts believe the company is well-positioned to capitalise on:

Government-backed projects
Low counterparty risk
Regulated return framework

Analyst View: Is Power Grid a Buy After the Rally

While the stock has already reacted sharply to the announcement, analysts say Power Grid remains a steady long-term compounder rather than a short-term trading bet.

Key positives highlighted by analysts include:

Predictable earnings model
Strong balance sheet
High project visibility
Supportive regulatory environment

However, investors should also keep an eye on:

Rising interest rates
Project execution timelines
Regulatory changes impacting returns

Overall, most market experts maintain a positive outlook on the stock for long-term portfolios.

What This Means for Investors

For retail and institutional investors alike, the revised capex guidance sends a clear message: Power Grid is confident about growth and execution in FY26.

If the company continues to deliver on its targets, it could:

Expand its asset base
Strengthen revenue visibility
Sustain dividend payouts
Play a central role in India’s energy transition

As infrastructure spending remains a key theme, Power Grid stands out as a low-risk, high-visibility PSU stock.

Conclusion

The 7% jump in Power Grid shares following the upward revision in FY26 capex guidance underscores the market’s trust in the company’s execution capabilities and long-term strategy. With ₹32,000 crore in planned capital spending, Power Grid is set to accelerate India’s transmission infrastructure build-out while delivering stable returns to shareholders.

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