cg power & industrial solutions ltd share price Management discussions



The year gone by (calendaryear 2022 for the world and fiscal year 2022-23 for India) was a year of continued volatility and steadfast resilience. On the verge of the two-year-long pandemic that crippled lives and livelihood, mankinds hope of a somewhat stable year met with a catastrophic Russia-Ukraine conflict in February 2022. The return of war to Europe after almost nine decades post the second world war spiraled into a truly global event with widespread financial, energy and technological sanctions against Russia. Geographic significance of strife-affected areas aggravated constraints on already challenged global supply chains, especially for food, fertilizer and energy.

With easing out of pandemic restriction from the vast swathes, except for certain regions in China, the global demand situation steadily improved throughout 2022. Concurrent supply bottlenecks fueled inflation to a record high. Consequent policy response of increasing interest rates applied further brakes to global economic recovery.

A severe economic crisis in Sri Lanka and Pakistan, civic unrest in Iran, unprecedented public push back against zero-Covid policy in China and heightened political instability in the United Kingdom left their own mark on the global economic landscape.

Defying the widespread global trends with an astute management of internal as well as external affairs, India continued to remain the silver lining of economic recovery. Coincidentally, 2022 witnessed

India gaining G-20 presidency with a responsibility of steering the world together on the path of economic and social development.

Global economic growth

The International Monetary Funds latest (April 2023) World Economic Outlook ("WEO") has estimated the world economic growth to have dropped down to 3.4% in 2022 from 6.3% in the previous year. Economic growth for Advanced Economies ("AE") and Emerging Markets and Developing Economies ("EMDE") are estimated to have slowed down to 2.7% (5.4% in 2021) and 4.0% (6.9% in 2021) respectively.

Taking cognizance of the recent financial sector turmoil, higher debt levels and continuation of Russia-Ukraine conflict, WEO has predicted further moderation in 2023 with economic growth for the world, AE and EMDE projected at 2.8%, 1.3% and 3.9% respectively.


Insulating itself to a greater extent from global volatilities and uncertainties, India remained steadfast in pursuing its 5-trillion-dollar economy dream. Its fiscal year 2022-23 (FY23) benefitted from near universal vaccination that helped contact-intensive sectors such as trade, hospitality and transport stage a comeback. Return of migrant labour to construction activities helped housing, infrastructure and industrial segments to speed up capital formation.

The Central Governments amped up stance of capital expenditure got paired with a healthy growth in private consumption. Exports growth continued its FY22 momentum in the first half of FY23. Countrys MSME (Micro, Small and Medium Enterprises) sector witnessed a very healthy credit offtake.

The strengthening of balance sheets of the Corporates and a robust, well capitalized banking sector fortified the foundation for the next round of Capex cycles across manufacturing, infrastructure and logistics sectors. Continued investments in public digital platforms coupled with recent enablers such as PM GatiShakti, the National Logistics Policy and the Production linked Incentive schemes augur well for driving a sustained growth in manufacturing sector.

The momentum of the previous fiscal (FY22) helped sustain accelerated growth during the first half of FY23. The aftereffects of external factors, European conflict and unprecedented inflationary pressure across advanced economies, however accentuated inflationary pressures as well as slowdown in export growth during the second half of FY23.

India - GDP growth

In FY23, the Indian economy once again demonstrated its inherent resilience and underlying strengths to emerge as the fastest growing major economy in the world. In spite of a gradual moderation in the second half, IMFs April 2023 WEO estimated the Indian Economy to have recorded a healthy growth rate of 6.8%.

Hailing India as the real bright spot of global growth in the near future too, WEO estimates suggest that the country will continue to be the fastest growing major economy in FY24 and FY25 too with projected growth rates of 5.9% and 6.3% respectively.

World Class Manufacturing Plant. The Global Solution in Electric Motor Ahmednagar


In the countrys march forward to become a 5-trillion- dollar economy, a key underlying theme is the manufacturing boom. Three factors supporting this underlying theme are:

• Internal strengths: Indias working age population of nearly 800 million with diverse skill and globally competitive wage structure makes the country a natural fit for becoming the next manufacturing back-office of the world. The rapid push towards bridging the infrastructure gap is steadily addressing the logistics bottleneck that long crippled our manufacturing and exports potential. Recent rationalization of corporate taxes coupled with a slew of initiatives such as Make in India, Atmanirbhar Bharat, Production Linked

Incentive ("PLI") scheme and a sharp focus on improved ratings on ease of doing business are all set to attract not only global manufacturing but also manufacturing investments in the country.

Geo-political stability, world-leading economic growth, substantial domestic demand and growth aspiration and appetite aptly demonstrated by the central leadership are all fueling steady growth in the countrys manufacturing sector.

External realignments: The frailty of a concentrated global supply chain that emerged and strengthened over the previous two-three decades got aptly exposed in the run up to and aftermath of COVID-19 pandemic. Recent Russia-Ukraine conflict further emphasized the advantage of insulating supply chains from conflict prone regions. Indias rich legacy of key

multinational companies manufacturing in India for several decades strengthens its credentials.

At a time when Corporations worldwide are shifting towards the China + 1 strategy, India, with its vast pool of skilled white collar and blue collar workmen, globally competitive technological ecosystems and wage productivity stand to gain significantly from above trends.

• Timing: Much before the frailties of concentrated supply chains got exposed, the worlds fastest growing economy was already preparing for a manufacturing boost. With making its intent clear to the world with the global roll out of the Make in India 1.0 campaign, the country continued to make massive public investment towards large scale infrastructure creation. Backing it up with aforementioned reforms, India is fast welcoming global manufacturers on its fertile turf.

In the Union Budget 2023-24, the government increased capital expenditure outlays by 33 per cent to 10 lakh Crore from 7.5 lakh Crore in FY23. The Budgets focus on infrastructure development through capital expenditure is expected to crowd in private investment and strengthen job creation and demand.

Not surprising then, the capital goods sector is dominating the monthly growth chart of industrial production activity in FY23. In the 11-month period (Apr22- Feb23) for which updates were available at the time of finalising this report, Capital Goods production recorded the highest and second highest growth rates 7 times and 3 times respectively.

Monthly growth rates of industrial production according to use-based classification













Primary goods












Capital goods












Intermediate goods












Infrastructure/ construction goods












Consumer durables












Consumer non-durables












Source: Ministry of Statistics and Program Implementation


Between April - December 2022 (9-month period), FHP, LT and HT motors recorded a growth of -2.6% (negative), 3% and 38% respectively, as per the latest IEEMA report of 6 April 2023. In our own assessment, lower demand will lead to de-grow FHP motor segment. However, LT motors will continue to grow on the back of growth in ethanol, bio-gas and infrastructure projects. The fastest growth is pegged to be witnessed in HT motor segment, duly aided by

aggressive government investment in water projects such as Jal Jeevan Mission and National River Linking Project.


Having completed a glorious 170-year long journey in 2023, the Indian Railways is the second biggest rail network in the world with over 108,000 km of running lines. Leveraging its multi-gauge assets, it transports passengers and cargo across the length

and breadth of the country, traversing plains, forests, deserts and snowy mountains.

Railway transportation is viewed as one of the central pivots of the grand vision of making India a ten- trillion-dollar economy by 2030. Consequently, the Indian Railways is undertaking steps for creating an enabling physical and social infrastructure that aids economic growth, ease of living, sustainable developments and reducing emissions.

Accelerating its modernisation drive in a mission mode, the vast legacy network of the Indian Railways is undergoing an inside-out transformation in recent times. The National Rail Plan, Vision 2024, aims to speedily implement critical projects - multi-tracking of congested routes, universal route electrification, speed upgrades to 160 kmph for Delhi-Howrah and Delhi-Mumbai routes and 130 kmph on all other golden quadrilateral-golden diagonal ("GQ/GD") routes, and elimination of all level crossings on the GQ/GD route - by 2024.

The Indian railways aims to harness and leverage indigenous technical capabilities in relevant fields of High Speed Railways ("HSR") with a view to develop professional expertise across all aspects of HSR. It will also contribute to the development of HSR specific standards in India. 17 billion dollars has already been invested in introducing High Speed train network for operation of bullet trains. This would modernise the rail network and make the railway industry globally competitive.

There is also a plan to introduce coaches made up of aluminium. These would be lightweight coaches, which would further reduce travel time.

Development highlights

• Aligning with Made in India initiatives for zero import of rail components

• 400 new Vande Bharat trains slated to be produced over the next 5-7 years

• 1st indigenously designed and developed hydrogen-fuelled train is slated to be rolled out by December 2023, 35 such trains to be operated on heritage and hill routes

• Rolling Stock Equipment & Components and Way Side Equipment (transformer, switchgears etc.) including indigenous TCAS/Kavach technology is slated to be implemented over 2,000 km of the network to increase capacity and ensure safety

• 100 PM-GatiShakti Cargo Terminals for multimodal logistics facilities to be built over the next three years

• Replacement of outdated Multi Cabin Mechanical Signalling System with modern Signalling System.

• Infrastructure spending includes an allocation of 31,850 Crore for new line projects, 30,749 Crore for track doubling, 4,600 Crore for gauge conversion, 17,296.84 Crore for track renewals and 27,482 Crore for the Eastern and Western Dedicated Freight Corridor projects

• Budgetary provision made for the manufacture of 1000 additional and smaller eight-car Vande Bharat EMUs, 25 hydrogen-powered trains and 150 air-conditioned EMUs

• A total of 1290 electric locomotives to be built at IR Locomotives production units and 55,000 newly designed wagons to be procured under public-private partnership ("PPP") mode


The overall generation (including generation from grid connected renewable sources) in the country has increased from 1110.458 BU during 2014-15 to 1624.158 BU during 2022-23, representing a growth of 4.87% CAGR during the period.

Y-o-Y growth for FY23 stood at 8.87% over 1491.859 BU generated during FY22. The growth was driven by an impressive 18.99% increase in Solar, Wind and other RES segments. Thermal category too recorded a healthy growth of 8.2% in FY23.

The electricity generation target (Including RE) for the year 2023-24 has been fixed as 1750 Billion Unit ("BU"), corresponding to an annual growth of around 7.2%.

The Indian Power Sector is poised for high growth for a long period. Two major enabling shifts on the generation side are increasing share of power from renewable sources as well as of private sector entities. Transmission segment too is geared up for renovation of legacy lines and addition of new lines to aggregate and integrate generation from relatively smaller capacity renewable sources. Distribution side too is fast progressing towards necessary reforms and modernization.

The Central Electricity Authority ("CEA") estimates the countrys power requirement to reach 817GW by FY30. Share of renewable energy is pegged to increase from current 18% to 44%

by ;Y30 which corresponds to an impressive 18.7% CAGR growth for the renewable segment. The Ministry of Power is geared up to increase the transmission target for renewable energy to 52GW by FY26 and 131GW by FY30 respectively. The central government has launched Revamped Distribution Sector Scheme of 3.04 lakh Crore till FY26. Expected procurement of MV Switchgear for the next three years is worth 3750 Crore for AIS, GIS RMUs and Automation.


At CG Power and Industrial Solutions Limited ("CG"), the business operations are spread across two business divisions:

Industrial Systems

Power Systems

Motors (LT/HT/FHP) &



Drives & Automation


Railway Products

Turnkey Solutions

Commercial Products

The Company has manufacturing facilities at Goa,

Madhya Pradesh (Bhopal, Indore and Gwalior), and

Maharashtra (Ahmednagar, Nashik and Aurangabad).



• Wide range of products and solutions sets CG Industrial Systems apart from its peers

• Technological competence backed by strong R&D and unmatched manufacturing capacity

• Possess requisite approvals and certifications to be a referred partner for customers across geographies and industries

• A forerunner in the indigenously developed EV Motors and Controllers for right from 3-wheeler to bus category

• CGs innovative Smart Motor solution helps customers monitor motor operations and health remotely for preventive maintenance

• CGs brand EMOTRON is well accepted in India, Europe and Middle East

• The largest manufacturer of Low-Tension motors and the first company to indigenously develop and supply a complete range of IE2, IE3 and IE4 efficiency motors in India

• A pioneer in making motors for application in hazardous areas with a market share of more than 60%

• Re-launched Fast Moving Electrical Goods ("FMEG") range of products in 2019

• Drives and Automation has its state-of-the-art R&D, design and development centres in Sweden and India along with two manufacturing facilities and solution providing teams in Germany and Netherlands

• A one stop solution provider for products of Electric Locomotives, CG is a strategic partner in technological upgrade and evolution for Indian Railways with state of the art manufacturing facilities approved by them

• CG is having strong foothold in the business of electric for self-propelled vehicles, Signalling Relay & Point Machines & Traction Machines

• CG Industrial System was the first to build business process automation on the digital platform way back in 2009

• The only Company to have a NABL accredited test laboratory for LV Motors testing up to 560kW as per IS/IEC 60034-2-1:2014 and IS12615 in India

Product Offerings





Industry Application

Low Tension Motors and IE2, IE3 and IE4 efficiency Motors

0.18kW to 710kW

Multiple variants and standards, customizable to configurations required for any industry/ equipment, EV Motors for e-mobility

Fractional Horse Power (FHP) Motors

0.02kW to 5.5 kW

Used for all general-purpose applications in Domestic, Commercial, Agricultural, Industrial, Healthcare and Construction segments

Hazardous area application Motors (LV and HV)

0.37kW to 12000kW

Designed to suit the ignitable atmospheres present in hazardous Locations such as Zone1, Zone 2 or Class1 Div 1 and 2

Large Industrial Machines (HT Motors)

Upto 12000KW

Energy efficient and intelligent motors for various applications in IP23, IP55, IP56 and IP65 enclosures

Stamping and Laminations

Consumer products to HVDC Generator & Alternators

For Industrial Motors, Alternators, Generators, Consumer goods motors like fan pump etc., Railway Motors

Drives & Automation



Drives and Automation

Low voltage AC Drives (LV & MV), Soft Starters, Shaft Power Monitor, Solar Drives, PLC and HMI

Commercial Products


Industry Application


Domestic and agricultural usage

Exhaust Fans / All-purpose fans

Industrial and domestic usage

Railway Products



Signalling Relays

Neutral Line Relays, Track Relays, Baised Relays, Lamp Proving, Latch Relays, Slow in Action, Other Relays

Point Machines

Electric Point Machines, DC Series Motor for Electric Point Machines, DC Series Motors IP67 with 400 V ACI for Secondary drive for Electric Point Machines

Coach Application Products

BLDC Carriage Fan, Universal Carriage Fan

Control Panels for Loco and Coaches

Switch Board Panels for Locomotive - SB1, SB2, HB1, HB2, Cubicle-F, Filter Cubicle panels for loco, EDTS 355, SBC 184 and SBC 200 for coaches

Traction Machines

AC Traction Motors (Electric Loco, Diesel Loco, EMU/MEMU and DEMU), DC Traction Motors (Electric Loco, Diesel Loco, DEMU, DETC and SPIC), Traction Alternators (Diesel Electric Loco, DEMU, DETC and SPIC)

Traction Electrics

Electrics for Diesel Electrics tower Car, Self-propelled inspection car & diesel Electric Multiple Units

Propulsion System and Train Control and Management System

IGBT Based Traction, Auxiliary Converters for Locomotives, IGBT Based Composite Converter / Hotel load Converter, Propulsion System for EMU / MEMU, Train Control and Management System (TCMS), Vehicle Control Unit

Control Panels for Locomotives

Loco Panels for Electric Locomotive HB1, HB2, Filter Cubical

Drives & Automation - Europe

Besides India business, CGs industrial systems business also includes Drives & Automation - Europe. With a production unit in Sweden and Germany, the Sweden headquartered for European business, addresses 4 core markets namely Nordic, Germany, Netherlands, MEA through distributors and partners at multiple markets outside of the home markets. Together with key customers, the group is creating sustainable, energy efficient solutions, mainly focusing on four segment Marine, water and waste water, green energy power solution, material handling. With a worldwide partner network with inherent technical service capabilities, the business is supported by authorised service partners, distributors and 234 employees based out of Europe.

Business Performance

• With a view to expand our market focus and presence with respect to new avenues and segments, the Company added new Business

Development Teams during the year. Dedicated Business Development Managers got deployed for Navy Defence, Oil & Gas; Textile, Paper &

Plastic; Metal & Mining, Chemical & Pharma, and Cement & Infra segments and Railway for strategic planning, identifying opportunities in target markets, and prospecting for new customers to help grow the organization.

• Having received primary approval, the Company is currently pursuing final approval from the Indian Navy. With targeted production of 2 Carriers and 35 War Ships within the next 3 years, the Indian Navy is presenting a potential business opportunity worth 120 Crore for Motors and Drives.

• Discussion on rate agreement with large player in telecom for supply of 1000 motors for 5GW PV factory is under progress. The customer is building 5 Giga factories - Lithium-Ion, Green Hydrogen, Polysilicon & Semi-Conductors. The scope of the contract is to be replicated for all the 5 factories as well as customers refineries.

• In a first, CG bagged a prestigious order for 6MW - 10 nos. HT Motors for NPCIL - Kaiga project. CG is the only Indian private player to get approval and order both from NPCIL. These motors are used for a very critical application inside the dome for reactor cooling pumps.

• Our discussion for a Strategic Partnership for Global supply has progressed well during the year. The customer is one of the worlds largest oil field services companies with active interests also in O&G equipment manufacturing - oil drills, compressors and pumps.

Promotion and market development initiatives

• Regional Dealer Conference was held at Goa with more than 135 dealers from across India in attendance.

• Arranged a dedicated seminar for Engineers India Ltd. ("EIL"), countrys premier consultant for Oil & Gas segment. In attendance were more than 35 executives from their technical department along with the head of department.

• In another first, CG made its maiden appearance at Kisan Exhibition 2022, displaying our agriculture range of products.

• Consumer product segment got an added boost with staging of 25 dedicated channel meets for retailer, electricians and plumbers during the year.

• The Company is preparing to make a strong and structured foray into Service Segment - after sales, spares and refurbishing. Titled Samriddhi, a dedicated services team is slated to be deployed to evaluate, mine and serve this new domain for all products of the Industrial Systems division.

Business development highlights

• Regaining of market share in Cement and Sugar sectors

• Market expansion in Oil & Gas sector

• Market reach enhancement in water sector

• Bagged order of 90KW motor for Nuclear Power Corporation of India Limited ("NPCIL"), inside Reactor building application

Operations highlights

A sharp focus of efficiency improvement marked

our business operations through the whole of FY23.

A slew of initiatives aimed at cost control, lead

time reduction, contract renegotiations, etc. helped

optimise resources.

New product development initiatives

• Range extension (water sector) 10/12 pole large motors in 630, 710 and 800 frames

• Cost effective design developed for 8P slipring motor in 710 frame

• Range expansion done for use of anti-friction bearing upto 2.9MW, 4P in 630 frame motors

• 10-15% motor weight reduction achieved through Design optimisation in selective frames

Success stories

• Achieved highest ever manufacturing of HT Slipring motors in a month - 33 Nos

• Supplied more than 50 Nos. of HT Hazardous area motors (flame proof, increased safety and non-sparking)

Awards and Recognition

• WILO Germany has recognised CG as Best Supplier globally

• Triveni Turbines has awarded CG as Preferred Supplier

Exports Growth Strategy

While global economy continues to recover from ongoing slowdown, long term opportunities for capital goods exports from India appears promising. More so with global supply chains embracing diversification of sourcing.

At CG, we are gearing up to grow our export footprints with dedicated strategies for Motors & Alternators as well as Drives & Automation.

For Motors & Alternators, we are banking on our premium offerings such as NEMA premium range and IE3 apex series coupled with product branding and contract manufacturing routes for developed economies including Americas and Europe. We aim to back it up with strengthening our distribution network in Europe, Middle East, and Africa ("EMEA") and North America regions. Our export success story is poised to be scripted on niche strengths including energy efficient products and hazardous area deployable products. Curated and targeted approach to focus end use segments of Oil & Gas, Steel, Cement, Sugar and Paper is another pivot of our exports growth strategy.

For Drives & Automation, the Company is already exporting AC VFDs of IP20 grade to its European subsidiaries besides direct exports to South Asia, Middle East and Russia. We are aiming for an accelerated exports growth in this established category.



• Offers wide range of Electrical Equipment ranging from 33kV to 800kV

• Developed first indigenous technology for resin impregnated paper bushings

• The first Indian manufacturer to develop and supply Ultra High Voltage 765kV SF6 Gas Circuit Breaker

• Supplied Capacitor Voltage Transformer and Surge Arrester for 1200kV transmission line project

• The first manufacturer of 132kV Green Transformer in India

• A pioneer in bringing the Vacuum Technology in India with ultra-modern Vacuum Interrupter manufacturing facility in Aurangabad

• Manufactures EHV and UHV Instrument transformers suitable for various environmental conditions

• EHV Instrument Transformers and bushings have proven in-service reliability over 25 years; 50,000 such units are successfully operating in 48 countries across the world

• One of the largest manufacturers of Electric Equipment for the Power and Industrial sector, also offering turnkey solutions in Power distribution and generation

• Nashik Plant possesses one of the largest Indoor Test Laboratories (among the top 5 in the world) of 1600kV Ultra High Voltage

Product Offerings




Industry Application

Power Transformers

500 MVA Auto Transformers Shunt Reactors (110 - 125 MVAr) 120 MVA Furnace Transformers 7.7 MVA 25 KV Locomotive and 30.24 MVA Track Side Transformers

Generation, Transmission, Distribution

Distribution Transformers

315 KVA to 4 MVA (3.3kV to 33kV Class)

Industrial Application

Low Power Transformers

4 to 50 KVA (11kV to 132 kV Class)

Generators, Station, Unit Auxiliary, Multi winding

Locomotive Transformers

6.531 MVA and 7.775 MVA


Solar Transformers for Invertor Duty

Up to 10 MVA (33 kV Class)

Solar Power Generation

Green Transformers

132 kV

Generation, Station, Industrial, Unit Auxiliary





Industry Application

MV Switchgear

Indoor Air Insulated Switchgears ("AIS") panels, Outdoor Breakers, Single Pole 25kV Breaker, Line up Roof Brushing Kiosk, Gas Insulated Switchgear ("GIS"), Indoor/Outdoor Ring Main Units ("RMU") up to 36 kV Class

Utilities, Industries, Power plants, Railways, Infrastructure Projects, Renewables, Smart city Projects Data Centres

Relay and Automation

CG Series Current and Voltage Numerical Protection Relay, Self-Powered Relay for Ring Main Unit ("RMU"), Aegis Series Feeder, Transformer and Motor Protection Relays Auto-reclose Relay, Feeder Remote Terminal Unit ("FRTU") for RMU automation

Utilities, Industries, Power plants, Railways, Infrastructure Projects, Renewables, Smart city Projects Data Centres

EHV Switchgears

Current Transformers, Transformer Bushing, Capacitor and Inductive Voltage Transformer, Grinding Capacitors, Surge Arrestors, SF6 Circuit Breakers 36kV to 765kV. Air Break Disconnectors 36kV to 245kV. Gas Insulated Switchgear 66kV to 245kV (EHV GIS), 245kV Hybrid GIS Dead Tank Breaker 72kV

Utilities, Industries, Power plants, Railways, Infrastructure Projects, Renewables, Smart city Projects and Data Centres

Vacuum Interrupters & HV

Vacuum Interrupters 690V to 72.5kV, Vacuum Contractors and Capacitor

MV Switchgear manufacturers, Power transformer

Instrument transformers up to 170 kV

Switches up to 36kV, Auto-Recloser and Sectionalizer up to 36kV Transformer Bushing 52kV and 72.5kV Current Transformer and Inductive Voltage Transformers ranging from 33kV to 170kV Class

Manufacturers, T&D Utilities

Power Quality Solutions

Automatic Power Factor Correction System, Fixed Capacitor Banks up to 36kV, Static VAR Compensator (STATCOM) up to 440V, MV Electrical Soft Starter up to 12kV, 20 MW

Transmission and Distribution Utilities, Water Supply Schemes, Steel, Cement, process Industries, Railways and Refineries


During the year under review, CG added/regained several new customers, application segments and geographies in India and overseas markets. Overseas geographies include Burkina Faso, Cameron, Congo, Greece, Kenya, Paraguay, Philippines, Suriname, Tunisia, UAE and Uganda. New application segments include:

• New approval for Instrument Transformers up to 420 kV, 420 kV IVT with 0.5g seismic acceleration, 800 kV Bushing, 420 kV Bushing with 0.5g, LOCO Lightening Arresters (special application), Polymer LA, new Circuit Breaker approvals up to 420kV, 245kV, high altitude of 1600-meter requirement (420Kv), 63kA for retrofit, 145Kv and 2-Pole Breakers

• New approval and entry in Bihar for 145kV GIS, entry in profitable LATAM segment with 145kV GIS, and entry in Tata Power with 72kV GIS

• Vacuum Interrupter Railways Track Side circuit breakers

• 33kV Automatic PF correction panel for Steel Industry feeders, Solar Power Plants, NGR application for Co-Generation, and Power Quality Solution for Mining Industry

• Smart Switching solutions for Power distribution with SCADA compatibility

• 170kV CTs with 0.5g seismic level withstand capability

• SCADA compatible Motorised RMU Rapid Mass Transit, Rectifier duty Transformer for Fertiliser Industry

• Distribution Transformer for Fertilizer, Automobile and Chemicals Industry

CG is intensifying its export focus for Power Transformers on emerging countries from Africa where the complete electricity network is shifting to higher ratings from 132kV to 225kV & 330kV. An order has been finalised from WAPP for Burkina Faso

Promotion and engagement activities

• Seminars and training sessions were arranged for utilities and EPC Contractors

• Technical articles were presented in IEEMA Journals. Presence in exhibition in Columbia to target market at Condensa, EPM and ISA. Technical presentation on New IEC requirements for LAs

• Participated in Mumbai based Builders Association Annual Meet for Promoting Power Quality Products (LBS & LT APFC) and EV chargers

• On site product training to operating staff of 100MW Solar Plant - Velturi, Telangana regarding Power Quality solutions & 33kV Capacitor / Reactor switch

• Trainings / seminars given to various customers.

• RMU Operation and maintenance Training Provided to Contractor

• Relay Operation Training provided to HVPNL.

• EIL Plant Approval for Distribution Range Transformer received

• DT Plant Approved by Tata Power Delhi Distribution Limited

• Seminar Conducted for Distribution Product in MES, Dehradun

• RDSO Product Approval from DT Malanpur Works - In Process

• NTPC Plant Approval for 145KV Transformer - In Process

• Product Training provided to 12 representatives of DT - After Sales Service Contractors at T2 Division.

• Continuous meetings and discussion on 2 x 25kV Semi High Speeds Railways with RDSO for New product development

• Presentation to EPC participating in 2 x 25kV

Semi High Speeds Railways tenders

• Plant assessment and approvals by Siemens Mobility, Tata Power Mumbai, Adani Group, Engineers India Limited

• Plant visits for future export business by customers from Cameroon, Zambia, Brazil, and Ukraine

New product development initiatives

During the year under review, a slew of efforts was put in towards development of cost-effective, size optimized products to retain present market share in Indian market and grow in cost sensitive African market. Variety of products with different utility specific applications were developed.

CG is supplying GIS for various Metro Projects in India including Mumbai, Indore Metro, etc. Built in tariff metering CT and PT in GIS help utility to save on space and multiple equipment.

CG is catering its GIS solutions for growing Data - Centre and Smart City projects in India. It has received order for 145kV GIS deployed for Smart City for Bhopal.

Cost saving initiatives

With a view to enhance our competitive relevance, an intense focus was allotted to a 360 degree cost optimization campaign. Kaizen implementation for process improvisation and Lean project for process optimisation were successfully explored. The range of activities covered under this holistic cost optimisation drive included Design Optimization, Alternate Sourcing, New Specifications, Renegotiation, Recycling, Alternate Process, Process optimization, Forward Booking, among others.

Project Mudra

The Company engaged a Tier-1 Management Consulting firm to drive the procurement efficiencies across all the business divisions. Special emphasis was put on material cost reduction, indirect cost optimization and capability building within the organisation. Key levers such as Cleansheet based costing, vendor consolidation, alternate supplier identification and price rationalisation are some of the initiatives undertaken under the project.

Having commenced in the second half of FY22, the project has started yielding positive results with visible saving accruals in FY23. The benefits/ savings are expected to continue in the future and reach their full potential in a phased manner.










Net Sales and Services





Cost of raw materials and components consumed and construction materials





Employee benefits expenses





Other expenses





EBIDTA excluding Other Income (OI)





Other Income (OI)





EBIDTA Including OI





Finance costs





Depreciation and Amortization





Profit before Exceptional items





Exceptional items (net)





Profit after Exceptional items



Less: Tax Expenses



Current Tax





Deferred Tax (Net)





PAT for the year from continuing operations





Minority Interest





PAT after Minority Interest





Profit from discontinued operations before tax





Tax expenses on discontinued operations





Profit from discontinued operations





Net Profit for the year





Cash profit for the year





FY 2023

FY 2022


Profitability Ratios

EBIDTA Margin (Excluding OI)



Increase in margin is mainly on account of higher contribution resulting from increase in revenue and absorption of fixed cost.

Operating Profit Margin (Excluding OI)



Increase in margin is mainly on account of higher contribution resulting from increase in revenue and absorption of fixed cost.

Net Profit Margin (before exceptional items)



Increase in margin is mainly on account of higher contribution due to increase in revenue, absorption of fixed cost and lower finance cost due to repayment of debt.

RONW on total operations



Return on net worth has declined during the current year due to lower exceptional gain compare to previous year.

ROCE (excluding exceptional item) (terminal) on continuing operations



Return on capital employed has improved on account of increase in operating profit due to increase in revenue and absorption of fixed cost, better working capital management and repayment of debt.

Per share Ratios

EPS (Basic) on the basis of total profits from continuing operations (In per share)



Basic EPS increase on account of increase in profit.

EPS (Diluted) on the basis of total profits from continuing operations (In per share)



Diluted EPS increase on account of increase in profit.

Leverage Ratio

Debt Equity Ratio



The Company has repaid its debts and hence there is an improvement in the ratio.

Interest Coverage Ratio for continuing operations



Reduction in interest cost on account of repayment of loan contributed to improvement in the ratio.

Assets Efficiency Ratios

Net Sales to gross working capital of continuing operation (Times)



No major variance

Net Sales to net working capital of continuing operation (Times)



Increase in net working capital resulted in reduction the turnover ratio.

Other Ratios

Average Debtors Turnover (no of days)



Increase in revenue resulted increase in average trade debtors.

Average Inventory Turnover (no of days)



Reduction in average inventory turnover days due to improvement in inventory management

Current ratio



Increase in current ratio due to increase in current assets and decrease in other financial liabilities


A detailed write up on Environment, Health and Safety ("EHS") has been provided in the Business Responsibility and Sustainability Report ("BRSR"), forming part of this report.


A detailed report of CSR activities of the Company during the year 2022-23 has been mentioned in the

CSR Report, which is appended with the Directors Report.


Being a legacy company with eight+ decades of existence and an early adopter of information technology, our SAP ECC system had organically grown over the last couple of decades with loads of redundant data as well company codes (active

and non-active). Additionally, the database of ECC system was 12 TB and plenty of custom code and Z Programs, custom reports, and batch jobs.

In light of this fact, it was decided by management to opt for latest technology of SAP Hana with active company codes data and custom reports relevant to CG. The journey of conversion with data carve out, which commenced in July 2022, was successfully made live on 10 April 2023.

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It is a matter of immense pleasure that CG has successfully gone live on SAP S/4 Hana 2021 on Rise. The latest version of SAP Hana provides improved usability for end-users along with added reliability for business operations. This includes cloud delivery capabilities that enables transition to an intelligent enterprise by decreasing risk and speeding up time to value.

The transition journey was a mammoth project involving redundant data archival that has reduced database size from 12 TB on ECC to 1.5 TB in S4H on Rise. The following are the additional benefits the adaptation of S4H:

• Less risk without compromise

• Easier to update business models

• Lower ownership costs & faster analytical insights

• More accurate forecasting & speedier period-end closings

• Improved productivity of its architecture as It is an in-memory database for fast access

Hana stores data in column-based tables versus the traditional row-based tables of an RDBMS. Following are the additional enhancements achieved with this transition:

• Costing Revamp: Migration from overhead cost to activity-based cost including material ledger/ actual costing.

The resultant business value include accuracy in material valuation, close monitoring of activities performed in production, and variance calculation and analysis to take corrective action.

• Group Reporting

Implementation: Migration of BW and BPC with 7TB of legacy databases.

The resultant business value is ease to use unified system and database to access real time dashboard reports with huge cost saving on efforts and landscape management.

• FIORI App: To get real time mobility access anywhere to access SAP without dependencies of GUI and systems.

The resultant business value is faster response to enhance business productivity.


A detailed note on R&D activities during the year under review is incorporated in the Directors Report.


At CG, we strive to create and sustain discrimination free habitat, promote harmony, and advocate fair employment opportunities. The company values and recognizes every individual equally and treats them fairly and with dignity. Our values of performance excellence and nurturance encourages the performance culture and discourages personal bias.

We encourage others associated with us to uphold the highest standards of human rights protection. The aspects of human rights are systematically integrated into our business operations and business relationships which ensure prevention of these rights across the value chains.

We believe in hiring best quality and passionate talent for our businesses and provide a mutual opportunity for them to contribute to the business as well learn and grow in their careers. CG hired 439 positions through the financial year 2022-23 to support and accelerate the business growth.

As at the end of the year, the Company had a total of 5,986 employees out of which 3,215 employees were on temporary/ contractual/casual basis.

Talent and Performance: The Company through its Performance Management Process branded as PRIDE, which stands for Personal Responsibility in

Delivering Excellence, endeavours to align rewards with performance.

CG continues to focus on enhancing the talent pool and encouraging its employees to upskill through its comprehensive learning and development programmes.

Employee engagement: Several meaningful

employee engagement activities related to Employees Health, Employees Social Responsibility, Employee Assistance Program were carried out throughout the year. Employee care and connect initiatives like Vaccination camp, Health awareness program, cyclothon, walkathon, sports day were rolled out during the year, which reflected companys concern for employees physical as well as emotional wellbeing. With the belief that shared social responsibility between employee and the company create better emotional engagement, initiatives like blood donation camp were carried out by contributing jointly to the society at large. Initiatives were taken to celebrate region specific cultural events to ensure the emotional connect between the employees and the company. Periodic town-halls are also conducted by all divisions to strengthen the connect with the employees.

Diversity, inclusion, women empowerment:

Gender Diversity and Equality is placed on the top priority at CG to enhance the inclusion across the company. Conscious efforts are made to increase the female ratio from its current level. As a part of this efforts, out of the total fresh campus recruits, 36% are females. Our focus on diversity hiring continues while hiring laterally. We have welcomed especially abled female candidates through the hiring process.

Digitisation of HR processes: Our focus to digitize the HR process continues. This year we have improvised CGHR4U - HRIS mobile application for enabling employees to address their HR issues on finger tips. myeNovation application was introduced to register the all Kaizens activities across all units. Our Emergency Reporting System was strengthened for improved monitoring and tracking of compliance as well as safety actions. We are in process of adopting the Learning Management System and our efforts are on track to integrate it with our HRIS module. We have fully digitised Balance Scorecard deployment and progress monitoring through CGHR4U. We have also fully digitized the process of assessment for the campus recruits.


The Company emphasizes the importance of robust internal control system which lays down the foundation of strong governance structure and promote a culture of integrity, transparency, and accountability in the business. Given the nature of business and size of its operations, the Company has designed and instituted a strong internal control system that comprises well-defined organization structure, roles and responsibilities, documented policies and procedures to reduce business risks through a framework of process controls.

The Company has established the Three Lines of Defense model as part of Internal control framework that encapsulates:

• First line of defense: Self review and verification by the Business/ Process managers.

• Second line of defense: Regular business and function review meetings by Business heads and Senior Management. Compliances to defined internal controls system are incorporated into performance measurement of Business Heads and CXOs.

• Third line of defense: Internal Audit conducted by the Specialized Internal Audit Firm and reports independently to the Audit Committee. Internal Auditor has direct access to the Audit Committee Chairman.

The Company re-appointed M/s. Price water house Coopers (PwC) Services LLP as the Internal Auditors for the financial year 2022-23. Audit

committee approves the Risk based Audit plan proposed by the independent Internal Auditors at the beginning of the year. Risk based audits are performed for all business and verticals (Corporate, Regional offices and Plants). The scope and objectives of internal audit reviews go beyond transactional risks. Emerging risk avenues are also considered while defining the audit plan.

The internal auditor focuses on business process and system audits to assess adequacy of internal controls, tracks evolution of risks and mitigation plan, compliance with the Company wide Delegation of Authority ("DoA"),

adherence to companys policies, procedures and prudent business practices.

Significant internal audit observations and status of implementation of action plans for risk mitigation are submitted to the Audit Committee every quarter for review. The Audit Committee assesses adequacy and effectiveness of inputs given by internal audit, and suggests improvement for strengthening internal controls from time to time.

The Company has also established whistle-blower mechanism operative across the Company for reporting of any unethical behaviours by employees or directors.

With the intent to build a strong control environment

and recommendations from the ¦ internal audit, the management j is continuously improving the I systems and processes through ¦ various initiatives in recent years. ^ Some of the select initiatives ; include:

Technology initiative includes

• Enterprise-wide Resource j Platform system - SAP I which enables the business .


processes has been recently L upgraded (to S4 HANA j version). This improves the i efficiency and scalability of u business processes along j with well-designed inbuilt system controls. S

• Bank Portal has been integrated with ERP system to seamlessly disburse the payment to vendors in secure manner. Similarly, Virtual Accounts mechanism has been set up with bank to seamlessly track the collection received the dealers.

• Inhouse HR Portal has been enhanced to digitize Hire to Retire process for all employees including recruitment, on boarding, attendance, leave, exit and performance management activities, thereby replacing manual controls with automated preventive controls.

• In house Vendor Management portal has been enhanced and integrated with existing ERP system to digitize vendor life cycle including online vendor registration, order management, vendor quality management and delivery scheduling.

• In house Sales and Marketing portal has been enhanced to digitize customer life cycle management processes including online customer registration, KYC validation and credit assessment approvals, enquiries & order management.

• Material handling process has been digitized at LVRM Unit by adopting the Bar Code System, thereby enhancing internal controls over material receipts, issuance process.

• Contractor Labour & Attendance management tool is being deployed across the plants to digitize the Contractor Management activities including induction of new contract worker, KYC documentation, safety training compliances, attendance recording and verification.

• Compliance management tool has been upgraded for effective governance and monitoring of compliance to statutory laws and provisions applicable at Corporate, regional office, plants and warehouses.

Process initiatives

• The Company has recently carried out GRC Assessment review from independent external consultant to identify and remediate the conflicting roles and access rights within the system, thereby ensuring the adequate segregation of duty controls and smooth conduct of the operations.

• The Company has defined the risk management framework for Commodity hedging to manage the risk of fluctuating metal prices.

• Internal Financial Controls Framework (including Risk Control Matrices ("RCM") of all financial processes and IT general controls) are redesigned to align to existing process and system controls. These Internal financial controls are annually tested by the independent internal auditors to assess effectiveness of internal controls over financial reporting.

• Contractual Term of Business has been now vetted by legal team and standardized across the business verticals and locations, thereby reducing risk of contractual non-compliances.

People initiatives

Periodic workshops are carried out with process owners to create awareness about importance of risk management and internal control system. The training are mandatory and training modules are also available in form of e-learns which are readily accessible to employees.


We are operating in a highly interconnected and dynamic world and the business landscape is shaped by a variety of shifting forces. The volatile environment that we operate in, demands that we need to be more prepared to face risks and uncertainties in the ever- evolving business landscape. We are committed towards protecting and maximizing value towards our stakeholders and it is our constant endeavor to take effective and risk-informed business decisions.

Risk Management is one of the key pillars of good corporate governance and contributes towards long term sustainability and growth of any organization. Maintaining effective risk management practices

is one of our strategic priorities and is closely monitored by the Risk Management Committee of the Board of Directors and Senior Management. CG Power and Industrial Solutions Limited ("CG") recognizes the importance of having a robust and comprehensive risk management system and is in a process of revamping the existing risk management policy, procedures and framework which will lay the foundation for Risk Management activities.

Our revised policy is designed to establish more robust and structured approach to Enterprise Risk Management. This will establish a systematic approach for risk management across various levels of the organization, including Unit-Level, Business- Division Level, Leadership Level. At each level, risk management roles and responsibilities have been defined. This will involve the use of Risk Management framework, to identify potential risks under various categories including both internal and external.


Scope, Context and Criteria for Risk Process

Defining the scope of the process after understanding the internal and external context within CGs risk appetite

Risk Identification

Identification of sources of risk, areas of impacts, events, and their causes along with their potential consequences- on the achievement of business objectives

Risk Analysis, Evaluation and Prioritization

Evaluate and assess the potential impact, likelihood and velocity of the identified risks and prioritization of risks based on the risk rating to identify key risks

Risk Treatment

It involves the process of planning and implementing risk mitigation plans and response strategies and assessing the effectiveness of the treatment

Risk Monitoring and Reporting

The status of the risks needs to be monitored periodically with the changing external environment and the key enterprise risks must be reported on a periodic basis to evaluate progress of mitigation plans

With this approach, we believe that we will be able to minimize potential losses while achieving our objectives. Our Risk Management Framework in conjunction with the Risk Management Policy will provide the Management and other stakeholders with an assurance that critical risks are identified at the right time and efficiently managed.

Companys business, financial condition and results of operations are subject to certain risks and liabilities that may affect the Companys performance and

ability to achieve its objectives. The factors that the Company believes could cause its actual results to differ materially from expected and historical results have been discussed hereunder. However, there are other risks and uncertainties that may affect the Companys performance and ability to achieve its objectives that are not currently known to the Company, or which are deemed immaterial. The principal risks and uncertainties that might affect the Companys business are identified below. The listing agreement with the stock exchanges mandates the

identification, minimization and periodical review of these risks and uncertainties. However, it is not possible for the Company to implement controls to adequately respond to all the risks that it may face and there can be no complete assurance provided that the steps that the Company undertakes to address certain risks, including those listed below under Risk Response Strategies, will manage these risks effectively or at all. The risk factors and uncertainties mentioned herein have not been listed in order of their importance.

Information regarding key risks facing by CGPISL and their mitigation strategies is given below:

Risk Factors


Risk Response Strategies

Strategic Risk

Our business and operational results

• Comply with all the regulatory requirements for expansion.

might negatively impact if there are delays in implementing our growth

• Regular monitoring of the status of expansion project.


• Ensuring supply of critical equipment as per schedule.

Operational Risk

Potential loss resulting from

• Implementing strong internal controls, including segregation of duties.

inadequate or failed internal process, people, systems, or external events.

• Enhancing in-house capabilities and leveraging from past learning and expertise.

• Implementing effective incident management and reporting mechanism.

Financial Risk

Volatility in raw material prices

• Implement sound hedging policies.

coupled with currency fluctuation might affect profitability.

• Ensure price variation clause in contract.

• Indigenous vendor development to minimize the impact of imports.

• Undertaking cost reduction projects to minimize commodity price fluctuation.

Supply Chain Risk

Shortage of critical commodities

• Continuous monitoring of key commodities and their availability.

including semiconductor and other electronics may result in delay in

• Engage/development of alternate sourcing of key commodities.

delivery to the customers.

• Provide long-term forecast to supplier for key commodities.

• Discuss longer schedules with customers proactively.

Technology Risk

Inability to adapt with evolving

• In-house upgradation and development of new technologies.

technological advancement to meet current/future market requirements

• Collaboration/JV with technological partners.

may lead to loss of business.

• Upskilling existing employees with technological advancement trainings.

Human Resource

Loss of one or more Senior

• Succession planning for Senior Management to ensure continuity in business.


Management and/or failing to recruit and retain employees could harm the

• People related policies for attracting and retaining talent.

Companys operations and prospects.

• Employee training and development to build strong talent pipeline.


Ever since coming under the majority ownership of Tube Investments (Murugappa Group) in November 2020, CG has completed the second full year of operations in FY23. While FY22 marked the period of stabilisation across multiple facets, FY23 witnessed Companys switch towards actualisation of its true potential. The Companys business performance bears testament to its reclaiming of lost/missed territory in terms of market presence, share and relevance. And also its competence and drive to pursue profitable sustainable growth.

FY23 witnessed a slew of measures aimed at structural strengthening. From operational efficiency

to financial prudence to R&D enabled future to risk- averse governance framework to ESG aligned long term growth, CG undertook a holistic 360-degree overhaul of its growth pivots.

With improving volumes, product mix, capacity utilisation and share in targeted market segments, the Company initiated the Capex phase consisting of two rounds of investments, the first aimed at debottlenecking and the second aimed at new additions.

While the operating environment continues to be volatile, Capital Goods (acronym-ed incidentally as CG) sector will continue to be the sweet spot of manufacturing segment. CG is poised to reap rich

dividends of being at the right place at the right time and most importantly in the right shape.

Three clear enablers of a positive growth for CG include steady volume growth that would be supported by an intense export focus, sustained margin protection that would emanate from efficiency measures, continued expansion of the playing turf that shall result from new initiatives being seeded towards sunrise areas such as EVs, Railways, Consumer Durables, etc.

In the light of aforementioned trends and actions, CGs business outlook remains robust and promising.