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CG Power and Industrial Solutions has received an updated stay order dated 7 September 2026 from the Income Tax Department

ICICIdirect Research 09 Sep 2026 DISCLAIMER

News: CG Power and Industrial Solutions has received an updated stay order dated 7 September 2026 from the Income Tax Department in respect of the revised tax demand for AY2022-23. The reassessment order dated 20 April 2026 had raised the tax demand to ₹236.73 crore, against the earlier demand of ₹188.79 crore. The company has appealed against the reassessment order before the Commissioner of Income Tax. The latest order grants a stay on the tax demand, subject to payment of 20% of the total demand, with ₹30 crore to be paid in five instalments; the remaining demand will stay subject to the conditions specified in the order.

View: The development is largely neutral from an earnings perspective but entails a limited near-term cash-flow impact. The immediate outflow of ₹30 crore is modest relative to the revised ₹236.7 crore demand, while the stay provides relief from the balance liability until disposal of the appeal. Importantly, the ₹236.7 crore should not be considered a crystallised liability at this stage, as CG Power continues to contest the assessment. Overall, we do not expect a material impact on the company's operating performance, although the matter remains a contingent financial risk until the appeal is resolved.

Impact: Neutral

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