Power Equipment Stocks Slide After Centre Opens Select Tenders to Chinese-Linked Manufacturers

CG Power share price, Hitachi Energy share price and several other power equipment stocks declined sharply on Friday after the Centre granted limited permission to four Chinese-linked manufacturers operating factories in India to bid for government contracts related to critical power infrastructure. The approval, issued through a Ministry of Finance order dated June 24, is valid for two years.

The order allows TBEA Energy, Nanjing Electric India, New Northeast Electric India and Taikai Electric (India) to participate in government tenders for specified projects. The exemption follows a proposal submitted by the Ministry of Power in January seeking permission for companies with manufacturing facilities in India to compete for such contracts.

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Power Stocks Under Selling Pressure

The announcement weighed on listed power equipment companies during Friday’s session. Hitachi Energy share price fell as much as 7.7% to ₹31,180, while CG Power share price declined around 6% to ₹900.75 during intraday trade.

Selling pressure extended across the sector. GE Vernova T&D emerged among the worst-performing midcap stocks, dropping 7.83%. Thermax lost about 4.2%, while BHEL slipped nearly 2.4%. In the broader space, GE Power India declined around 5% and TD Power Systems fell more than 4%. The Nifty Energy index was trading nearly 1% lower during the session.

Government Grants Limited Exemption

According to the Ministry of Finance order, the exemption applies only to the four identified companies and is restricted to eligible government tenders for critical power projects. The document also states that the approval will remain effective for two years and should not be treated as a precedent for similar requests from other companies.

As per reports, India had been examining possible relaxations for Chinese bidders with local manufacturing operations after an easing of border tensions. Reuters had earlier reported that the government was evaluating broader changes to participation rules for Chinese companies in public procurement.

Higher Competition for Domestic Manufacturers

The entry of these companies into government tenders is expected to intensify competition for domestic equipment suppliers. As per an IIFL Capital report cited in media reports, TBEA Energy manufactures extra high-voltage transformers, while Nanjing Electric India produces equipment including insulators and gas-insulated switchgear used in high-voltage direct current projects. Taikai Electric (India) is capable of producing 400 kV and 765 kV gas insulated switchgears.

In the wake of the border conflict that took place in 2020, India imposed stricter procurement policies on Chinese firms, compelling them to secure registration along with political and security clearance to take part in any government tender.

The recent decision of exclusion comes amid growing transmission facilities by the nation to cope up with increasing power requirements and renewables. This is a very limited policy change for a select group of manufacturers having manufacturing facilities within the nation.