Archive · 20 Aug 2026
Transformer Oil Demand Rises With India’s Power Grid Expansion
Transformers help move electricity, and transformer oil keeps them cool and safe.
India is planning a large expansion of its power grid.
This could increase demand for transformer oil.
The global market for this oil is also expected to grow.
Savita Oil makes transformer oils and other specialty products.
APAR Industries makes transformer oils as well as conductors and cables.
Both companies reported strong recent earnings.
However, some of the profit growth came from higher prices and inventory effects that may not last.
APAR also faced supply disruptions and is reducing its inventory risk.
India plans around ₹9 lakh crore of investment to expand and modernise its national power transmission grid.
The global transformer oil market is projected to grow from about $2.9 billion in 2025 to $7.5 billion by 2033.
Savita Oil reported Q1FY27 revenue of ₹1,512.7 crore and net profit of ₹292 crore, aided partly by inventory gains.
APAR Industries’ Specialty Oils division grew revenue 34.7% year-on-year despite a 13.7% decline in volumes caused by supply disruptions.
Savita Oil offers a lower-valuation specialty-oils play, while APAR combines transformer oils with conductors and cables but trades at a higher valuation.
- Who
- Savita Oil and APAR Industries are the two companies examined.
- What
- The article assesses how India’s power-infrastructure expansion could benefit transformer-oil manufacturers.
- When
- The earnings figures refer to Q1FY27, and the valuation comparison is dated 19 August 2026.
- Where
- The opportunity is centered on India, with demand also discussed in global markets.
- Why
- New power plants, transmission lines, substations, renewable-energy projects, manufacturing, urbanisation and data centres are increasing the need for transformers and transformer oil.
Lower-Valuation Specialty Play
Diversified Scale Play
Business exposure
Lower-Valuation Specialty Play
Savita Oil combines transformer oils with specialty petroleum products, exports and newer cooling-fluid applications.
Diversified Scale Play
APAR Industries has exposure to transformer oils through its Oils division and also benefits from conductors and cables.
Recent earnings quality
Lower-Valuation Specialty Play
Savita Oil’s strong margins were supported by higher prices and gains from older raw-material inventories, which may be one-off benefits.
Diversified Scale Play
APAR Industries expanded margins despite lower volumes, although its results also benefited from selling-price and energy-price dynamics.
Valuation and risk approach
Lower-Valuation Specialty Play
Savita Oil traded at a discount to its historical median and in line with the industry median, according to the article.
Diversified Scale Play
APAR Industries had stronger reported ROCE and ROE but traded at a premium to its three-year historical average and the industry median; it is also moving toward just-in-time inventory management.
- Planned Indian grid investment
- Around ₹9 lakh crore under the National Electricity Plan.
- India’s non-fossil capacity target
- 500 GW by 2030.
- Global transformer oil market
- About $2.9 billion in 2025, projected at $7.5 billion by 2033.
- Savita Oil Q1FY27 revenue
- ₹1,512.7 crore, up 49.2% year-on-year.
- Savita Oil Q1FY27 net profit
- ₹292 crore, compared with ₹59 crore in Q1FY26.
- APAR Specialty Oils Q1FY27 revenue
- ₹1,701 crore, up 34.7% year-on-year.
- APAR Industries consolidated Q1FY27 net profit
- ₹467 crore, up 77.7% year-on-year.