Undervalued Smallcaps: TD Power Systems Could Rally Further, Says SEBI RA Gunjan Kumar

SEBI-registered analyst Gunjan Kumar has flagged TD Power Systems for more gains if its current breakout sustains. He noted that it is an undervalued company with strong fundamentals.

TD Power Systems shares have rallied 49% in the last three months. 

The company has a return on equity (RoE) above 22 and a return on capital employed (RoCE) above 28.

On technical charts, the stock recently broke out of its consolidation pattern, reaching an all-time high. Kumar suggests monitoring TD Power Systems above ₹535 with support at ₹504. 

On the fundamentals, TD Power Systems has reported strong financials. They posted the highest revenue in the last 13 quarters. Margins, too, improved to 20.7% in their fourth quarter (Q4FY25), at a 13-quarter high. 

Foreign Institutional Investors (FIIs) have steadily increased their stake over the last 12 quarters. Recently, Goldman Sachs purchased nearly 11 lakh shares of the smallcap company via block deals, valued at ₹50.30 crore.

TD Power Systems manufactures AC generators and electric motors for power plants and industries. It offers custom solutions to various sectors, including renewable energy, oil and gas, and railways. 

Strong demand for gas turbines and large generators, particularly from data centres, has driven export growth. Overall, India’s electrical equipment industry is benefiting from investments in renewable energy and infrastructure. 

Data on Stocktwits shows retail sentiment turned ‘bullish’ on this counter a day ago.

TD Power Systems shares have gained 16% year-to-date (YTD). 

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