WPIL — Q2 FY26 earnings call

Call held 7 Nov 2025

Management summary

WPIL Limited delivered a mixed performance in Q2 and H1 FY26, marked by robust growth in its international and product divisions, which helped stabilize overall margins. The domestic project business, however, continued to face headwinds, largely due to delays in Jal Jeevan Mission funding. Management expressed confidence in resolving these issues and maintaining growth momentum across its diversified portfolio, while also actively exploring strategic acquisitions.

Highlights

  • Consolidated Q2 FY26 revenue from operations stood at INR 426 crores, with EBITDA at INR 80 crores (18.87% margin) and PAT at INR 52 crores (12.16% margin).

  • Consolidated H1 FY26 revenue was INR 805 crores, EBITDA INR 130 crores (16.09% margin), and PAT INR 78 crores (9.64% margin).

  • The Product Division reported H1 FY26 revenues of INR 151 crores, a 9.42% YoY growth, with its order backlog reaching a highest-ever level of INR 422 crores.

  • International business revenues grew sharply by 58.33% YoY in H1 FY26 to INR 456 crores, contributing to overall business stability and margin recovery.

  • The Project Business faced challenges, with Q2 FY26 revenues falling to INR 89 crores (down 63.96% YoY), primarily due to ongoing Jal Jeevan Mission (JJM) funding issues.

  • Management anticipates more commissioning in the domestic project business in H2 FY26 and expects O&M revenue to reach INR 70-100 crores by FY26-27.

  • The company is actively pursuing larger inorganic opportunities, leveraging its strong cash balance and increased authorized capital.

Concerns

  • JJM Funding Delays

Key financials

2 periods

Q2 FY26

  • Consolidated Revenue
    ₹426 Cr
  • Consolidated EBITDA
    ₹80 Cr
  • Consolidated EBITDA Margin
    18.9%
  • Consolidated PAT
    ₹52 Cr
  • Consolidated PAT Margin
    12.2%

H1 FY26

  • Consolidated Revenue
    ₹805 Cr
  • Consolidated EBITDA
    ₹130 Cr
  • Consolidated EBITDA Margin
    16.1%
  • Consolidated PAT
    ₹78 Cr
  • Consolidated PAT Margin
    9.6%

What they filed

Q1 FY27: revenue up 32.2%, net profit up 126.9% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue491 382 572 379 426 −13%539 +41%511 −11%501 +32%
EBITDA104 48 80 49 80 −23%113 +135%76 −5%75 +53%
Net profit70 37 -24 26 52 −26%76 +105%47 +296%59 +127%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

SegmentRevenue (H1 FY26)Revenue (H1 Last Year)YoY Growth (H1 FY26)
Product Division₹151 Cr₹138 Cr9.4%
Project Business———
International Business₹456 Cr₹288 Cr58.3%

Order book

high confidence

Execution

Most of our projects in the JJM have progressed beyond 60% achievement and they are all in the final stages of commissioning. So, I think we will be commissioning well in time.

Composition

  • Product Division Backlog (product) ₹422 Cr
  • International Project Division (geography) ₹930 Cr
  • JJM Project Exposure (remaining) (project type) ₹1,100 Cr
  • O&M Order Backlog (service type) ₹600 Cr
  • International Business Share (geography) 56%
  • Product Business Share (product) 56%

Pipeline

other

The enquiry pipeline remains robust and order book growth is expected to continue across all sectors.

The company's order books across product, international project, and O&M segments are strong, with the product division reaching its highest-ever backlog. Domestic project execution is progressing well, with most JJM projects in final stages, though funding delays persist.

Source: Prepared remarks

Capital allocation

high confidence
  • Capex Capex disclosed
    CAPEX is negligible because we are well kept. I mean, all our plants are having enough sufficient capacity to handle this. ... We don't need any substantial CAPEX.
  • Debt Debt disclosed
    we received funds and we have reduced our liability. So, I think the good thing from our perspective is that our conceptual liability to client is reduced drastically and our creditor liability is negligible.
  • M&A PCI Africa Acquisition · Integrated

    Boost growth and benefit from African water sector growth.

    Q1 margin hit due to newly acquired businesses, but margins recovered in Q2.

    PCI, we have acquired in May. So, it has just been 4 months since then. And we should see that picking up in the second half.
  • M&A Undisclosed larger acquisitions Acquisition · Announced

    Leverage cash balance and authorized capital for inorganic growth, especially to penetrate markets like the US.

    Yes, we are also looking at some larger acquisitions on the inorganic opportunities.
  • Liquidity Liquidity disclosed The company has a good amount of cash balance available, even after recent acquisitions, and has increased its authorized capital, positioning it for potential larger acquisitions.
    since we have a good amount of cash balance available with us, even after the acquisitions we did. So, are we looking out for any further inorganic opportunities?

Guidance & targets

Revenue

  • O&M Revenue Revenue · FY26-27 · High confidence INR 70-100 crores
    by the end of '26-27, we are looking at about 70 to 100 crores of O&M revenue.

    — Prakash Agarwal

  • Product Business Growth Revenue · Full year FY26 · Medium confidence Constant growth
    The product business is looking at constant growth based on the order backlog we have, as I said, which is at record level. Also, the enquiry pipeline.

    — Prakash Agarwal

  • International Business Boost Revenue · H2 FY26 · Medium confidence Big boost
    So, we should get a big boost in the second half year. Internationally, we see the boost continuously increasing.

    — Prakash Agarwal

Margin

  • EBITDA Margin Profile Margin · Ongoing · High confidence 16-20%
    Our margin profile is between 16 to 20 and that is something we have maintained.

    — Prakash Agarwal

Project Execution

  • JJM Project Commissioning Project Execution · By March 2026 · Medium confidence Most projects commissioned
    I expect it surely in the second half of this year by March.

    — Prakash Agarwal

What to watch in Q3 FY26

JJM Funding Resolution & Cash Flow

By March 2026 (H2 FY26)
Current Ongoing Centre-State funding issue, impacting cash flows and project completion.
Target Resolution of funding issues, release of blocked funds, and acceleration of invoicing/bidding.

Why it matters

Direct impact on working capital, project execution, and overall domestic project business recovery.

I expect it surely in the second half of this year by March.

Risks & concerns

  • JJM Funding Delays

    high

    Ongoing issue between Centre and State regarding fund disbursement for Jal Jeevan Mission projects, causing delays in cash flows and project completion.

    Management acknowledged

  • Project Business Revenue Decline

    medium

    Project business revenues fell significantly in Q2 FY26 (INR 89 crores vs INR 247 crores last year), indicating execution challenges, though management expects a pick-up in H2.

    Management acknowledged

  • Lag in Employee Cost Recognition

    low

    An increase in employee costs despite project slowdown was noted, attributed to fixed costs and mobilization efforts, creating a temporary lag in revenue recognition.

    Analyst acknowledged

Q&A highlights

6 direct
JJM Funding Resolution and Execution Outlook Direct
Most of our projects in the JJM have progressed beyond 60% achievement and they are all in the final stages of commissioning. So, I think we will be commissioning well in time. ... I expect it surely in the second half of this year by March.

Addresses the critical issue of delayed government project payments and provides a timeline for resolution and project completion, impacting cash flow and future revenue recognition.

Asked by Deepak Purswani

International Order Book Execution and Margin Profile Direct
for the international project division, we have the order book of 930 crores. ... Margins have started improving and are expected to normalize through the year, supported by a strong international order book.

Clarifies the size of the international project order book and confirms that international margins are aligning with domestic, contributing to overall margin stability after a Q1 blip.

Asked by Deepak Purswani

Inorganic Growth Strategy and Valuation Tolerance Partial
Yes, we are also looking at some larger acquisitions on the inorganic opportunities. ... So, maybe this is the appropriate time to get that big target.

Reveals the company's active pursuit of M&A, leveraging its cash and authorized capital, and hints at a potential shift towards being more aggressive in valuations for strategic targets, especially for market penetration.

Asked by Nirav

Employee Cost Increase vs. Project Slowdown Direct
Well, we have a fixed cost there. Sites have to be manned. So, that cost structure is still there. We have had to mobilize to expedite the work and the revenues have gone down. But the type of work which is needed is there. So, I think there is a lag period to revenue and site costs. So, you will see it evening out.

Explains the temporary disconnect between rising employee costs and declining project revenue, attributing it to fixed operational costs and mobilization efforts, which is expected to normalize.

Asked by Saket Kapoor

Preference Share Reclassification Direct
It is not conversion. It is reclassification from redeemable preference shares to equity shares. It is not issued. ... This is the authorized capital we are talking about, never ever issued.

Clarifies a technical accounting/corporate action regarding authorized capital, reassuring investors that it's not an issuance or dilution but a reclassification for future flexibility.

Asked by Balu Shankar Lamkhade

O&M Business Revenue Potential Direct
We have an order backlog of roughly about 600 crores in this sector. And most of these projects will go into O&M starting in next year. Next year, some will go into O&M and they will be continuously going into O&M. So, I think by the end of '26-27, we are looking at about 70 to 100 crores of O&M revenue.

Provides specific guidance on a growing revenue stream from O&M contracts, indicating long-term service potential from commissioned projects.

Asked by Ashwani Sharma

Global Pump Market Opportunity and WPIL's Strategy Partial
The global pump market is estimated at about 60 to 70 billion. And out of that, we do mostly engineer and industrial pumps. So, that market would be close to 50% to 60% of that. ... We don't have a presence in the US, which we are trying to penetrate into.

Offers insights into the vast market opportunity for pumps and WPIL's strategic focus on engineer/industrial pumps, highlighting untapped markets like the US as future growth avenues.

Asked by Nirav

Confidence in JJM Payment Resolution Direct
So, the Jal Jeevan scheme, if you go through the media reports and you understand from the Jal Jeevan pocket, it's a scheme between the center and state. And we understand that the fund disbursement, there are some issues there, some points which they are trying to clarify and then release the funds. So, hopefully, we see this is making good progress and we should see some results soon.

Reiterates management's confidence in the resolution of JJM payment issues, providing context on the Centre-State dynamics and the expectation of funds flowing soon.

Asked by Tej

3 min read 7 chapters

Detailed narrative

Q2 & H1 FY26 Financial Performance Overview

WPIL Limited reported consolidated Q2 FY26 revenue of INR 426 crores, with an EBITDA of INR 80 crores, translating to an 18.87% margin. Profit after tax for the quarter was INR 52 crores, at a 12.16% margin. For the first half of FY26, consolidated revenue reached INR 805 crores, with EBITDA at INR 130 crores (16.09% margin) and PAT at INR 78 crores (9.64% margin). Standalone figures also showed healthy margins, with Q2 EBITDA margin at 20.01% and PAT margin at 14.21%.

Segmental Performance: Product, Project, and International Business

The Product Division demonstrated strong performance in H1 FY26, with revenues of INR 151 crores, marking a 9.42% increase over the previous year, and achieving its highest-ever order backlog of INR 422 crores. Conversely, the Project Business faced significant headwinds, with Q2 FY26 revenues declining by 63.96% YoY to INR 89 crores. The International Business was a key growth driver, with H1 FY26 revenues surging by 58.33% YoY to INR 456 crores, contributing significantly to overall business stability and margin recovery.

Order Book and Pipeline Overview

The company maintains a robust order book across its segments. The Product Division's backlog reached a record INR 422 crores, while the International Project Division holds an order book of INR 930 crores. The remaining exposure for Jal Jeevan Mission projects stands at INR 1,100 crores, with most projects over 60% complete. Additionally, the O&M sector has an order backlog of approximately INR 600 crores. Management noted a robust enquiry pipeline, expecting continued order book growth across all sectors.

Jal Jeevan Mission (JJM) Challenges and Outlook

The domestic project business, particularly JJM, continues to face challenges primarily due to funding issues between the Central and State governments. This has impacted cash flows and project execution timelines. However, management expressed confidence that the issue is making good progress towards resolution, with expectations for funds to be released and balance project activities to accelerate by March 2026, leading to more commissioning in H2 FY26.

International Business Growth Drivers

International revenues grew sharply, driven by strong order books and improved performance in regions like South Africa, where execution is picking up in H2 due to different financial year cycles. Gruppo Aturia secured strong orders in oil and gas, and Australian operations showed improved performance with promising opportunities. WPIL Thailand also introduced new drainage products, further diversifying the international portfolio. International business now accounts for 56-60% of the total, providing a balanced revenue mix.

Capital Allocation and M&A Strategy

WPIL maintains a negligible CAPEX outlook, as existing plants have sufficient capacity for anticipated growth. The company has a strong cash balance and has increased its authorized capital, positioning it to pursue larger inorganic opportunities. Management is actively engaged in conversations for strategic acquisitions, particularly to expand its geographic reach into markets like the US, emphasizing a 'buy and build' model to maximize gains from acquired footprints.

Operational Efficiency and Margin Stability

The company's margin profile is consistently maintained between 16-20%. While Q1 FY26 saw a temporary blip due to newly acquired businesses and one-time expenses, margins recovered in Q2 FY26, with consolidated EBITDA margin at 18.87%. Management expects this normalized margin level to be sustained through the year, driven by improved execution and a favorable product mix, with the product business contributing 56-60% of the total.

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