CG Power shares fall up to 2% after ₹600 crore order won by unit cancelled

Shares of CG Power & Industrial Solutions Ltd. will be in focus on Monday, November 24, after it informed the exchanges that an order for KAVACH systems won by one of its unit stands cancelled.

CG Power said in its exchange filing that G.G. Tronics India Pvt. Ltd. had received an order from Chittaranjan Locomotive Works for the supply of Loco Kavach systems under the developmental category in November 2024.

The order, valued at around ₹600 crore, now stands cancelled. The scope of the order comprised of supply, installation, testing and commissioning of on-board KAVACH equipment as per the RDSO specifications including annual maintenance for a 11-year period.

Delivery period for the order was 12 months, subject to completion of product development, independent safety assessment (ISA), RDSO approval and full compliance with version 4.0 specification. The ISA and RDSO approval activities are now in their final stage.

"Due to these approval timelines, the supply could not be initiated within the stipulated delivery period and therefore the order stands cancelled," CG Power's exchange filing stated.

However, G.G. Tronics will remain eligible to qualify for upcoming tenders under the Developmental Category.

Additionally, the same filing also stated that the subsidiary has made significant progress in the development and field validation of the Uniform Braking Algorithm and in defining braking parameters across multiple locomotive classes.

G.G. Tronics Pvt. Ltd., based out of Bengaluru, specialises in designing, manufacturing, supplying and installing electronic safety embedded signalling systems for the railway transportation segment.

Shares of CG Power ended 1.6% lower last Friday at ₹709.55. The stock is down 2% in the last one month and is down 4% in the year so far.