Electric equipment stock surges 5% as company enters into defence electronics space

Synopsis: A transmission equipment company’s subsidiary acquires 75% stake in a power electronics company with a list of defense clients such as BHEL and DRDO. The acquirer’s order book stand at Rs 830 Crore

A small cap transmission equipment company engaged in the business of energy transition equipment and power technologies saw its stock in the spotlight soon after the company’s subsidiary acquired 75% stake in Veeral Controls Pvt Ltd

With a market cap of Rs 5,886 Cr, Quality Power Electrical Equipments Ltd saw its stock hit an intraday high of Rs 763.90 which is 4.8 percent higher than the previous close of Rs 728.35 

What’s the News?

On Friday Quality Power Electrical Equipments Ltd  announced that the company has acquired a 76% majority stake in Veeral Controls Private Limited through its subsidiary, Quality Power Engineering Projects Pvt Ltd, with an equity infusion of Rs. 15.2 crore via primary capital issuance. 

Veeral Controls is a Gujarat-based power electronics company with over three decades of expertise in high-current rectifiers and power conversion systems catering to industrial, rail, nuclear, defence, and green hydrogen applications. The acquisition significantly strengthens Quality Power’s technology portfolio, expands its presence in medium- and high-current power electronics, and creates strong synergies with its existing high-voltage equipment and power quality solutions.

Veeral Controls serves a diversified blue-chip customer base including ABB/Hitachi, BHEL, BARC, Indian Railways, Indian Navy, DRDO, Tata Power, Tata Steel and ReNew Power, with its power systems deployed across India, Europe, the United States, Australia, and the Middle East. With this customer base and reach, it is very likely that this acquisition can open doors for Quality Power to the defence sector along with a wide customer reach.

Business & Financial Overview

Quality Power Electrical Equipments Limited was incorporated in 2001, and is a technology-driven company which is engaged in energy transition equipment and advanced power technologies. The company has its headquarters in Maharashtra, and has 7 Operating Facilities in India and Turkey with 1500 employees and customer base in 100 different countries in 5 different continents.

 Quality Power serves the domestic as well as the global markets across critical power infrastructure and grid modernisation segments. Quality Power has an order backlog of Rs 830 Cr, along with the contributions from Quality Power Group.

In the latest quarter the company saw a YoY revenue growth of 119 percent, going from Rs 94 Cr in Q2FY25 to Rs 206 Cr in Q2FY26, while the QoQ went up by 16 percent from Rs 177 Cr in Q1FY26.

The YoY Net Profits growth is at 169 percent, going from Rs 13 Cr in Q2FY25 to Rs 35 Cr in Q2FY26, while the QoQ fell by 5.4 percent from Rs 37 Cr in Q1FY26. Moreover, the company has a 3-year Profit CAGR of 57 percent, and we could also see a slight increase of FII stake in the September quarter.

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