China Power Gear Policy Rattles Indian Equipment Stocks

China Power Equipment Policy Shift Hits Indian Makers Hard The Indian power equipment sector woke up to a materially different competitive reality this week. A regulatory reversal has cleared four Chinese power equipment manufacturers to participate in domestic infrastructure projects, unwinding restrictions that had been in place since 2020. That four-year window of protection had been consequential — domestic players had used it to win contracts, expand capacity, and rebuild order books that had historically struggled to compete on price against Chinese imports. The reversal doesn't just change the bidding dynamics on future tenders. It prompts a full reassessment of the earnings assumptions that currently underpin valuations across the sector. The timing is uncomfortable. India's power sector capital expenditure cycle is running hot, with transmission and distribution spending expected to exceed ₹3 lakh crore through 2027 under the Revamped Distribution Sector Scheme and related programmes. Domestic equipment companies had positioned themselves as the primary beneficiaries of that spending. That narrative has now developed a significant crack. Whether the policy change applies to all project categories or only specific tender types will matter enormously to the earnings calculus — and that clarity is still missing from the market. Short answer: investors sold first and will ask questions later. That's a rational response when the competitive moat that justified premium valuations gets narrowed overnight. Sector Selloff: Who Gets Hit and by How Much The immediate market reaction centered on [CG Power and Industrial Solutions](/stock/CGPOWER) (NSE: CGPOWER), [Power Grid Corporation of India](/stock/POWERGRID) (NSE: POWERINDIA), and [Apar Industries](/stock/APARINDS) (NSE: APARINDS), all of which saw selling pressure as the news filtered through. [BHEL](/stock/BHEL) (NSE: BHEL) and [ABB India](/stock/ABB) (NSE: ABB) were also caught in the downdraft, though the...