GE Vernova, Hitachi Energy, TARIL tumble up to 10%; what’s weighing on investor sentiment? Explained

Shares of power equipment manufacturers, such as GE Vernova T&D India (GVTD), Hitachi Energy India, Siemens Energy India, CG Power and Industrial Solutions and Transformers and Rectifiers (India) Ltd (TARIL), came under sharp selling pressure on Friday, July 3, after news reports said the Centre has allowed four Chinese-linked power equipment companies to participate in government tenders for critical power projects.

Investors fear the move could intensify competition in a segment that has benefited from limited participation by Chinese players since 2020.

GE Vernova T&D India shares were trading 9.65% lower at ₹4,357.50 apiece on the NSE, while Hitachi Energy India was down 9.10% at ₹30,700. Siemens Energy India shares were trading 5.66% lower at ₹3,348.70 apiece on the NSE, and CG Power and Industrial Solutions traded 7.33% lower at ₹889.10.

Transformers And Rectifiers (India) or TARIL was down 4.76% at ₹340.25 on the NSE.

According to a government order dated June 24, as reported by news channels, the Ministry of Finance has granted a two-year exemption to four Chinese-linked manufacturers with production facilities in India - TBEA Energy, Nanjing Electric India, New Northeast Electric India and Taikai Electric (India)— allowing them to bid for government contracts involving critical power infrastructure.

The exemption was sought by the power ministry earlier this year to support India's rapidly expanding transmission network and renewable energy capacity. The order also clarifies that the relaxation is valid for two years and should not be treated as a precedent for other companies.

Reports say that the development marks a notable shift from the restrictions imposed after the 2020 India-China border clashes, when Chinese companies were required to obtain political and security clearances before participating in government contracts.

The prospect of increased competition in the high-growth transmission and grid equipment segment weighed on investor sentiment, triggering a broad sell-off in domestic power equipment stocks despite the overall strength in the broader market.

According to analysts, the exemption primarily benefits the four Chinese-linked vendors in the high-voltage (HV) transformer and gas-insulated switchgear (GIS) segments. They are now permitted to supply equipment to public sector undertakings (PSUs) in India for the next two years, a temporary measure aimed at bridging the domestic supply gap until local manufacturing capacity catches up with the country's rapidly growing demand.

GE Vernova T&D India (GVTD), Hitachi Energy India, Siemens Energy India, CG Power and Industrial Solutions, and Transformers and Rectifiers (India) Ltd (TARIL) operate in the power transmission and distribution (T&D) equipment segment of the electrical capital goods industry.

These companies manufacture and supply critical grid infrastructure such as power transformers, gas-insulated switchgear (GIS), substations, transmission equipment, and grid automation solutions, playing a key role in electricity transmission, renewable energy integration, and the expansion of India’s power network.