TD Power Systems, a leading manufacturer of generators and electric motors, has signed a five-year agreement to supply traction motors to Europe, anticipating business worth Rs 300 crore. The company’s stock saw a 2% increase in mid-day trading on October 21 following the announcement.
The contract, signed with the Indian arm of a global company, includes an initial order valued at Rs 18 crore, with delivery scheduled for April 2025. Over the course of the next five years, the business volume from this deal is expected to reach Rs 300 crore.
Traction motors are critical components that convert electrical energy into mechanical energy, used to power movement in various machines. TD Power has been actively pursuing growth in international markets, which it views as offering significant potential across several sectors.
During its June quarter earnings call, the company highlighted strong growth in segments like gas engines, gas turbines, and hydroelectric power. It also noted that the shift toward renewable energy and increased demand from sectors like electric vehicles is driving its overseas business.
The company currently exports 4-pole and 2-pole generators to the Middle East’s oil and gas industry and supplies motors to the steel, cement, and power sectors. In the competitive Indian Railways traction motor market, TD Power has maintained a cautious strategy, supplying only limited quantities.
However, the company anticipates that this segment could offer up to Rs 100 crore in future opportunities as prices stabilize. For FY24, TD Power reported total order inflows of Rs 1,051 crore, with exports and deemed exports making up 57% of the total.
Recent major orders include international gas engine generator deals worth Rs 142 crore. The company’s June quarter results showed a 24.28% year-on-year increase in net sales to Rs 273.78 crore and a 32.62% rise in net profit to Rs 35.35 crore.
