CG Power Is Running on 110x PE – Is This a Transformer or a Time Bomb?

1. 🧠 At a Glance

CG Power has transformed from bankruptcy junk to Murugappa Group’s crown jewel. With 27% ROE, 37% ROCE, and zero debt, it’s the poster boy for turnarounds. But with a PE of 110x, the Street is pricing in a Tesla-like future from a company that still sells transformers.

2. 🎬 Introduction with Hook

Once upon a time (read: FY20), CG Power was drowning in fraud allegations, bankrupt management, and rating downgrades. Then came the Murugappa Rescue Squad, cleaned house, and made it profitable again.

Fast-forward to FY25:

• ₹9,900 Cr revenue
• ₹1,300+ Cr profit
• ₹3,000 Cr fresh QIP raised
• 📈 135% stock CAGR in 5 years

But now the real question: is this valuation justified or has the Street short-circuited?

3. ⚙️ Business Model – WTF Do They Even Do?

CG Power operates in two major segments:

They’re also pivoting towards automation, EV ecosystem, and smart infrastructure (read: buzzword buffet).

4. 💰 Financials Overview – Profit, Margins, ROE, Growth