Atlanta Electricals Ltd Q2FY26: The Transformer Titan Shocks the Grid with 50% ROCE, 40.8% ROE, and Enough Orders to Light Up Gujarat Twice

1. At a Glance

When Bhagavad Gita said, “You have the right to work, but not to the fruits thereof,” clearly Atlanta Electricals Ltd read only half the line. Because this Anand-based transformer powerhouse not only worked hard—it took home all the fruits, the basket, and probably the tree. With amarket cap of ₹7,090 crore,Q2FY26 revenue of ₹317 crore, and aPAT of ₹30.2 crore, the company’s numbers are buzzing like a substation on Diwali night.

Frompower transformers to inverter duty transformers, Atlanta’s 5 manufacturing facilities (including one newly juiced-up in Vadod) are running hot—literally—clocking117% utilisationat Gujarat Unit I. The stock, priced at ₹922 (as of 19 Nov 2025), trades at aP/E of 58.1, with aROCE of 50.2%andROE of 40.8%—metrics that would make even Tesla’s gigafactories blush.

And in classic desi corporate style, they don’t pay dividends. Because who needs cash outflow when you can flex₹2,069 crore worth of order book?

2. Introduction

Welcome to the curious case ofAtlanta Electricals Ltd (AEL)—a company that makes transformers but somehow transforms every rupee into gold. Born in 1983 in Anand, Gujarat (the land of Amul), Atlanta didn’t make butter; it made power. And unlike most power-sector firms that thrive on subsidies and prayers, AEL seems to have mastered the art of keeping lights onandthe balance sheet glowing.

The company’s rise has been almost cinematic. Over five years, sales grew from ₹525 crore in FY20 to ₹1,244 crore in FY25—a 137% surge. Profits? They skyrocketed from ₹13 crore to ₹119 crore, an8.8x explosion. ROE stands taller than the Sardar Patel statue at 40.8%.

What’s the secret sauce? Simple—Atlanta didn’t just build transformers; it built credibility. With4,400 transformersalready supplied across 19 states and 3 union territories (aggregating to94,000 MVAcapacity), their equipment is quietly humming in the background every time you charge your phone or overclock your inverter during load-shedding.

If the rest of the capital goods sector is running on extension cords, Atlanta’s plugged directly into India’s infrastructure push.

3. Business Model – WTF Do They Even Do?

Atlanta Electricals manufactures and suppliestransformers—those massive, buzzing steel boxes you see beside substations. Except theirs are a bit fancier. Frompower transformers (11kV to 220kV)toauto transformers, furnace, generator, and inverter duty transformers, they basically build the backbone of India’s electricity transmission network.

Their clientele reads like the who’s who of Indian energy:Adani Green Energy, TATA Power, GETCO, and SMS India. In FY25, the top two clients alone contributed nearly40% of revenue—enough to make any auditor twitch nervously.

Here’s how they make money:

• 76% revenue from power transformers, the bread-and-butter of state utilities.
• 11% each from auto and inverter duty transformers, riding the renewable boom.
• 2% from allied products, possibly spares or components.

The company operatesfive facilitiesspread across Gujarat and Karnataka, with a total installed capacity of63,060 MVA. Gujarat Unit I is running at117% utilisation, which is basically corporate-speak for “we ran this factory like it owed us money.”

In November 2025, Atlanta approved a₹65 crore capexto build a new inverter-duty transformer facility—funded through internal accruals and a bit of debt. Because why stop when the transformer’s hot?

4. Financials Overview

Annualised EPS:₹3.93 × 4 = ₹15.7 →P/E ≈ 58.7

Atlanta’s quarter-on-quarter consistency would make any investor weak in the knees—steady growth, thick margins, and a touch of renewable sector flavour. QoQ flatness? Sure, but when your order book is worth ₹2,069 crore, one can forgive a slow quarter.

5. Valuation Discussion – Fair Value Range Only

Let’s crunch some numbers like a true Excel warrior.

• Current Price:₹922
• EPS (TTM):₹16.6
• P/E:58.1
• EV/EBITDA:35.2
• Industry P/E:48.5

Method