Kirloskar Oil Engines Stock Leads 3 India Power Picks Tied To Data Center Demand

With energy prices in focus, inflation pressures linked to supply risks, and central banks reacting to every data point, many investors are revisiting nuclear energy stocks as a potential source of reliable power exposure. The Nuclear Energy Stocks screener narrows this broad theme into companies involved in uranium supply, fuel processing, and reactor operations. This can help you cut through the noise of global policy headlines and commodity swings. In this article, you will see 3 stocks highlighted from that screener, along with clear, practical context for how each fits into today’s market cross currents.

Kirloskar Oil Engines (NSEI:KIRLOSENG)

Overview: Kirloskar Oil Engines is an India based power solutions company that makes diesel engines, generator sets, pumps and related equipment for sectors such as infrastructure, data centers, telecom, agriculture, defense and manufacturing, along with aftermarket parts and service. It also has a smaller financial services arm that supports customers and dealers.

Operations: Kirloskar Oil Engines generates most of its revenue from B2B customers at ₹56.9b, with smaller contributions from B2C at ₹11.4b and financial services at ₹8.8b. The bulk of its ₹68.0b sales comes from India, with exports of ₹9.0b.

Market Cap: ₹317.3b

Investors looking at nuclear and power reliability themes may find Kirloskar Oil Engines interesting because it sits at the heart of India’s backup power build out for infrastructure, commercial real estate and hyperscale data centers, including a recent 192 MW Optiprime order for AI enabled facilities. This sits alongside growth in higher horsepower engines and recurring aftermarket service. On the risk side, the stock trades on a high P/E, margins have come under some pressure, and the business is still heavily tied to diesel technology and external funding, so the key question is whether its order book and diversification can justify that richer pricing over time.

Kirloskar Oil Engines sits at the crossroads of India’s backup power needs and AI hungry data centers, yet its high P/E and diesel exposure raise sharp questions that the 2 key rewards and 3 important warning signs (1 is major!) only starts to answer

Larsen & Toubro (BSE:500510)

Overview: Larsen & Toubro is a Mumbai headquartered engineering and construction group that delivers large scale infrastructure, energy, defence and high tech manufacturing projects, alongside IT services, financial services and real estate activities in India and overseas.

Operations: Larsen & Toubro generates most of its revenue from Infrastructure Projects at ₹1,354.2b and Energy Projects at ₹549.0b, with meaningful contributions from IT & Technology Services at ₹545.7b, Financial Services at ₹178.5b and Hi Tech Manufacturing at ₹144.9b.

Market Cap: ₹5,207.3b

Investors looking at nuclear and wider power infrastructure may find Larsen & Toubro interesting because it links a record order book in infrastructure and hydrocarbons with higher margin areas like IT, digital services and defence. It is also building exposure to renewables, green hydrogen and data centers. The company’s large international footprint, particularly in the Middle East, adds diversification but also concentrates geopolitical and funding risk. Its P/E sits well above the Indian construction sector even as analysts broadly view the stock as fairly priced. For those wanting to understand how that tension between strong project flow, improving capital efficiency and execution, and funding and margin risks might play out, the analyst narrative and forecasts provide additional detail beyond the headlines.

Larsen & Toubro’s high P/E and record order flow suggest that something more complex is priced in, and the full 2 key rewards and 1 important warning sign could reveal whether project strength is quietly masking one crucial pressure point

Bharat Heavy Electricals (BSE:500103)

Overview: Bharat Heavy Electricals is a New Delhi based engineering company that designs and supplies power plant equipment and industrial systems for coal, gas, hydro and nuclear power, as well as transmission, transportation, defence, aerospace, solar, e mobility and energy storage projects in India and overseas.

Operations: Bharat Heavy Electricals generates most of its revenue from the Power segment at ₹274.3b, with a smaller but meaningful contribution from the Industry segment at ₹85.7b.

Market Cap: ₹1,452.7b

Bharat Heavy Electricals sits at the intersection of conventional power build outs and newer themes like green hydrogen, with earnings moving from loss to profit and net margin improving to 6.8% alongside recent earnings and revenue growth figures. At the same time, a P/E of 59.7x, a share price above one DCF estimate, low 9.3% ROE and concerns around board independence, funding structure and an unstable dividend record indicate that investors may be paying a premium while taking governance and sustainability risks. For those watching nuclear and broader power infrastructure, the balance between project wins and these balance sheet and oversight questions is a central consideration.

Rapid earnings recovery, a 59.7x P/E and nuclear exposure put Bharat Heavy Electricals at the center of the power story, but the full 2 key rewards and 1 important warning sign

The three stocks covered here are just a starting point, and the full Nuclear Energy Stocks screener has surfaced 20 more companies with equally compelling nuclear energy stories across uranium supply, fuel services and reactor operations. Use Simply Wall St to identify and analyze the specific catalysts, policy angles and earnings narratives that matter most to you, so you can focus on the highest conviction nuclear energy ideas.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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