Genus Power targets smart gas metering opportunity alongside robust electricity meter order book

Investment View and Key Drivers

Emkay Research retained its BUY recommendation on Genus Power Infra and its target price of Rs450 in its August 20, 2026 company update. The positive view is based on the company’s leadership in smart electricity metering, its Rs240 bn order book at the end of Q1 FY27 and a potentially significant new opportunity in smart gas metering.

• Potential cumulative smart gas metering opportunity of Rs350-400 bn during FY26-34.
• Smart electricity meter order book of Rs240 bn at Q1 FY27-end.
• Management expects tenders for more than 80-90 mn meters in FY27.
• Potential earnings support from rising exports and the scale-up of operations and maintenance revenue.

Smart Gas Metering Opportunity

Emkay estimates a cumulative Rs350-400 bn opportunity for smart gas meter manufacturers during FY26-34. The opportunity follows the Government of India’s approved incentive scheme, effective September 1, 2026, to promote domestic PNG connections. It is also supported by the PNGRB’s proposed roadmap to mandate smart prepaid gas meters for new domestic piped natural gas connections and gradually replace conventional meters for existing customers.

India had 16.7 mn domestic PNG customers at the end of February 2026, with annual additions averaging 1.2 mn over FY14-26. PNGRB targets 126 mn customers by FY34. Emkay believes Genus Power Infra is well placed to participate through its PNGRB-compliant G1.6 diaphragm gas meter, SKG-16, and its g-Setu retrofit meter interface unit, which converts basic gas meters into smart meters. However, the broker notes that smart gas meter adoption is likely to be gradual.

Smart Electricity Metering and Execution

The existing smart electricity meter business remains the central source of revenue visibility. Genus Power Infra has historically held more than 25 per cent market share in smart electricity meter manufacturing. Its Rs240 bn order book at Q1 FY27-end supports execution over the coming years, while the expected tender pipeline provides additional visibility.

Management has guided for FY27 revenue of Rs60-65 bn and an EBITDA margin of 18 per cent. Reported Q1 FY27 performance was strong, with revenue growing 45 per cent year on year and PAT rising 27 per cent year on year. Emkay states that these results increase its confidence that the FY27 guidance can be achieved.

Management also expects working-capital days to improve by 50-75 days from 274 days at FY26-end. Working-capital execution therefore remains a relevant operational factor for cash conversion.

Financial Forecasts

Emkay forecasts standalone revenue to increase from Rs47,375 mn in FY26 to Rs59,720 mn in FY27E, Rs66,980 mn in FY28E and Rs77,120 mn in FY29E. EBITDA margins are projected to remain broadly stable at 19.7-20.2 per cent, while adjusted PAT is expected to grow through FY29E.

The broker’s charts imply FY26-29E revenue and EBITDA CAGRs of 18 per cent and a PAT CAGR of 20 per cent.

Valuation and Recommendation

Emkay notes that the stock was trading at 12 times FY28E EPS and 10 times FY29E EPS. The Rs450 target price is based on 15 times June 2028E EPS. The recommendation and target price were unchanged from the prior recommendation. The target implied 34.7 per cent upside from the report CMP of Rs334.