Emkay Projects 75% Upside for Smart Meter Stock as Order Book Approaches Triple Market Capitalization

Emkay Research has recently reaffirmed a ‘BUY’ rating on Genus Power Infrastructures (GPIL), highlighting a target price of INR 550 against the current share price of around INR 31. This forecast indicates a promising upside of approximately 75%. The brokerage’s positive outlook is supported by a substantial order book worth INR 25,200 crore, alongside the government’s Revamped Distribution Sector Scheme (RDSS), which is driving an increased demand for smart meters. With around 156 million meters already tendered and 70 million installed, Genus is well-positioned to capitalize on the anticipated additional tenders in the upcoming fiscal years.

As Genus Power scales its Advanced Metering Infrastructure Service Provider (AMISP) business through a joint venture with Singapore’s GIC, it marks a shift towards a more stable revenue model, notably in Operations & Maintenance (O&M). Management forecasts significant growth in O&M revenue from INR 150 crore in FY26 to up to INR 900 crore annually over the next couple of years. This transition is critical as Genus aims to establish a recurring revenue stream, thereby enhancing financial stability amid the fluctuating costs experienced in its operations. Despite challenges in gross and EBITDA margins due to fixed-price contracts and rising raw material costs, the company is optimistic about becoming cash-flow positive by late FY27.

The current trading multiples for Genus Power stand at 14x for FY27E and 11x for FY28E earnings, suggesting solid potential for growth, particularly if execution remains robust and cost management strategies are effectively implemented. For Indian investors, this stock presents a compelling opportunity, especially with the expected demand for smart meters supporting a long-term bullish outlook. The successful execution of projects, alongside the scaling of the planned INR 500 crore export business, will be crucial drivers of the stock’s performance moving forward, making it an attractive consideration for portfolio diversification in the growing energy sector.

Source: The Economic Times

(Expert Note: This report was prepared by the Wealthova IPO team.)