About the Company:

HBL Engineering Limited, formerly known as Sab Nife Power Systems Limited, was incorporated in 1988 by A J Prasad in a Joint Venture with Nife, Sweden. During the year 1999-2000, name of the company was changed to HBL Nife Power Systems Limited, further changed to HBL Power Systems Limited in 2006 and has subsequently changed the name to HBL Engineering Limited in 2024. The Company is a leading battery and power systems company based in Hyderabad, India. The company came in to existence as a result of the merger in 1999 of Hyderabad Batteries Ltd (HBL) incorporated in 1977, and SAB Nife Power Systems Ltd incorporated in 1986.

Now, HBL Power Systems manufactures a range of batteries, including Lead Acid, Ni-Cad, Silver Zinc, and Lithium, along with railway and defense electronics, Solar Photovoltaic Modules and other products. The company is also engaged in service activities related to the above products. HBL Power provides battery and engineering solutions to system integrators, EPC (engineering, procurement and construction) firms, and clients in railway, aviation, and defense sectors globally. It operates in various segments including Industrial Batteries, Defense & Aviation Batteries, and Electronics, which is further divided into Railway Electronics and Electric Mobility. The company partners with Indian government bodies like Indian Railways, Indian Air Force, Indian Navy, and MOD labs.

The company operates 5 manufacturing plants across Telangana and Andhra Pradesh. HBL Power operates across India and also exports to more than 50 countries across North America, Europe, and the Middle East, facilitated through its subsidiaries.

The company ranks 2nd globally in the industrial nickel batteries segment and 3^rd in India's VRLA lead batteries segment. It is also the only manufacturer of PLT lead batteries in the country.

The company is implementing a capex plan of about Rs. 100 Cr in FY25, to make high energy density cells in-house. A pilot plant was set up in FY22 for Rs. 40 Cr. These cells are for defense use only. In April 2023, the company entered into an investment agreement of Rs. 150 Cr with Tonbo Imaging. As of FY24, it has invested Rs. 87 Cr in the Tonbo. Tonbo Imaging specializes in designing and manufacturing electro-optics and imaging systems for surveillance, reconnaissance, and targeting.

HBL with its proven experience is now uniquely poised to offer Containerized Battery Energy Storage Solutions-Lithium Ion Based (BESS-LIB), enabling for multiple applications based on the customer requirements. It has already installed BESS for Rail, Defence and industrial applications. Vande Bharat, the new rail coach systems in India are going to be equipped with HBL Make BESS-LIB. Company has also received orders worth Rs. 3000Cr. for KAVACH system which is to be equipped in all trains of Indian Railways to avoid train accidents. HBL is the only company to receive KAVACH 4.0 certifications from Govt. of India. The South-Central Railway has issued letter of acceptance to HBL for upgradation of the Kavach Version 3.2 to Version 4.0 in Mudkhed (Including) - Manmad (Excluding) Section. FY26 sales are projected to be 30% higher than FY25, following the issuance of Kavach tenders in August 2024. For FY27 and FY28, the company anticipates a CAGR of 20% over FY26, with a minimal moderation of EBITDA expected alongside this growth.

Business Segments:

Company’s major business units include Batteries, Electronics, E Mobility, Defence, Spun Concrete, Battery Energy and Storage Systems and Naval Systems & Technologies.

Industrial Batteries (64% in Q1 FY25 vs 74% in FY23): The company offers VRLA batteries, PLT batteries, Nickel Cadmium batteries, and Lithium-Ion Batteries to Telecom, Oil and Gas, Power, and other sectors. Its industrial customers include Vande Bharat trains, Siemens, Hitachi, New York City Metro, etc. This segment has grown by 40% between FY22 and FY24, backed by strong demand from the telecom sector.

Defense & Aviation Batteries (18% in Q1 FY25 vs 13% in FY23): The company offers batteries for all aircraft, missiles, armored vehicles, torpedo propulsion, and submarine propulsion. It also develops electronic fuzes for ammunition including grenades, artillery shells, rockets, missiles, airdropped bombs, and other voice and data communications systems for armored vehicles like battle tanks and armored personnel carriers. The segment revenue has declined by 2% between FY22 and FY24.

Electronics (17% in Q1 FY25 vs 10% in FY23): In the Railway Electronics segment the company offers 2 flagship products:

1. TCAS (Train Collison Avoidance System): In 2022 the Indian Railways announced KAVACH as the National Automatic Train Protection System. In June 2023, the company entered into a contract with Ashoka Buildcon to supply and commission all equipment involved in the Kavach system for Rs. 135 Cr for the East Central Railway project.
2. TMS (Train Management System): A TMS features a master control center where a large video wall displays the status of all trains within its jurisdiction. The company is the only approved Indian provider of TMS. While the TMS business is smaller in scale compared to Kavach, its annual value is around Rs. 200 Cr, with a typical system priced at Rs. 50 Cr.

In the Electric Mobility vertical, the company has developed Electric Drive Trains and is designing 35-ton and 55-ton trucks, aiming to become a small-scale truck OEM. Sales of these new products are expected to begin in H2 FY26. The electronics segment has seen revenue growth of nearly 300% between FY22 and FY24.

Naval Systems & Technologies Pvt Ltd is also an associate company of HBL Engineering Limited. The company started operation in 2006 and has been a profit making company. NST specializes in following activities such as Engineering, information technology, naval architecture, and operational solutions for Naval systems in general and submarine systems in particular. Systems engineering/design integration; operational sustainment and life cycle support. Lifecycle logistics, Schedule management and on-site logistics. Acquisition and production management for ships, systems, and marine equipment. Waterfront and field engineering support, Naval architecture design and development support. License production of marine equipment on the basis of Transfer of Technology. Installation, Setting to Work, Habour Acceptance Trials and Sea Acceptance Trials for marine equipment. Warranty support and Annual Maintenance Contracts for marine equipment. Specialized software development for Combat Management System and Sonars. NST has been involved in various marine related Projects with renowned Original Equipment Manufacturers (OEMs), mostly from Europe.

Fundamentals:

Financial Results:

Company’s Jun-2025 Quarterly Revenue is Rs 607 Cr which is growth of 17.5% YoY. Its Jun-2025 Quarterly Net Profit is Rs 140 Cr which is growth of 88.2% YoY.

On segmental front Industrial Batteries segment reported revenue of 32589 lakhs compared to 32646 lakhs in same quarter in YOY, Defence and Aviation Batteries segment reported 7364.93 lakhs revenue compared to 9216 lakhs in Fy24, Electronics reported 18039 Lakhs compared to 8730 in Fy24 and remaining segment reported 1002 lakhs revenue compared to 852 Lakhs in Fy24.  

Conclusion:

HBL Power Systems has carved a strong niche across multiple segments—industrial batteries, power electronics, defense electronics, and railway signaling equipment—balancing its revenue streams across both domestic and export markets. The company’s industrial batteries remain a steady revenue driver, supported by growing demand from telecom, railways, and backup power systems. Its defense electronics division, bolstered by government modernization programs, offers higher margins and technological entry barriers, while export orders for specialized battery systems are steadily rising.

Looking ahead, the broader power solutions industry is set for transformation, fueled by renewable energy integration, electric mobility, and heightened defense spending. As India targets rapid electrification and infrastructure upgrades, demand for advanced battery technologies, energy storage systems, and intelligent power management solutions will accelerate. HBL’s continued investments in R&D, emphasis on specialized high-performance products, and expanding global footprint place it in a favorable position to capture these opportunities.

For prudent investors, HBL Power Systems offers not just defensive stability but also exposure to high-growth segments aligned with national and global energy transitions. While short-term market swings may impact stock performance, the company’s diversified base, technological expertise, and strategic sector alignment suggest a promising growth story for those willing to hold for the medium to long term.

HET ZAVERI
info@smartinvestment.in

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