Ceinsys Tech — Q1 FY26 earnings call

Call held 1 Aug 2025

Management summary

Ceinsys Tech reported a strong Q1 FY26, achieving record revenue and EBITDA driven by successful project execution and a strategic shift towards higher-margin technology solutions. Despite delays in some government projects, the company maintains a healthy order book and pipeline, focusing on operational efficiency and international expansion through both organic growth and strategic acquisitions in geospatial and new technologies.

Highlights

  • Operational revenues grew by 112% year-on-year to INR157 crores.

  • EBITDA increased by 130% year-on-year to INR30 crores, with margins at 19.35% (up 140 bps YoY).

  • Net profit was INR32 crores, a growth of 166% year-on-year, and PAT margin stood at 20.18%.

  • Technology solutions revenue saw a 2.74-fold increase to INR84 crores, contributing 54% to total turnover.

  • The total order book stands at INR1,209 crores as of June 25, with an additional INR800-900 crores targeted for FY26.

  • Employee cost as a percentage of revenue declined significantly to 23% from 35% in the prior year's corresponding quarter.

  • The company holds an operational cash surplus of INR127 crores.

Key financials

  1. Operational Revenue ₹157 Cr +112%YoY
  2. EBITDA ₹30 Cr +130%YoY
  3. EBITDA Margin 19.4% +1.4%YoY
  4. Net Profit ₹32 Cr +166%YoY
  5. PAT Margin 20.2%

What they filed

Q1 FY27: revenue up 0.6%, net profit down 3.1% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue90 112 142 157 163 +81%170 +52%171 +20%158 +1%
EBITDA17 21 27 30 36 +112%40 +90%40 +48%38 +27%
Net profit12 18 22 32 26 +117%39 +117%37 +68%31 −3%
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

Share of Revenue
₹156 Cr Total
  • Technology Solutions ₹84 Cr 53.8%
  • Geospatial & Engineering Services ₹72 Cr 46.2%

Order book

high confidence

Total value

₹1,209 Cr

as of 2025-06-25 quantified

1% QoQ

Inflow this quarter

₹132 Cr

Execution

execution over next 18 months

Composition

Mix 2 segments
  • Geospatial 63%
  • Technology Solutions 37%

Share of order book by segment

Pipeline

deal pipeline tcv

additional order book expected for FY26

Cancellations & deferrals

  • deferred: Jal Jeevan Mission orders put on hold due to government audit
Order book growth has been slow due to government project delays, but pipeline remains strong with significant opportunities.

Source: Prepared remarks

Capital allocation

high confidence
  • M&A Geospatial businesses in US and Europe Acquisition · Pursuing

    Expand horizons into domains where the company is already operating, focusing on new technologies in geospatial.

    we are a couple of the acquisitions which we are pursuing, both of them come from geospatial, but both of them also come from the technologies, newer technologies which don't exist in CS Tech today. So, vertical will be geospatial. Technologies will be new. That's what we are looking. And geography, both the acquisitions serve U.S. as well as Europe.
  • Liquidity Cash ₹127 Cr Operational cash surplus available.
    As of quarter end, it holds an operational cash surplus of INR127 crores.

Guidance & targets

Order Book

  • Additional Order Book Inflow Order Book · FY26 · Medium confidence INR800-900 crores
    our target is to at least get around INR800 crores to INR900 crores additional order book during this financial year.

    — Kaushik Khona

  • Jal Jeevan Mission Contribution to FY26 Pipeline Order Book · FY26 · Medium confidence INR400 crores
    Out of INR800 crores to INR900 crores, the Jal Jeevan would be in the range of around INR400 crores as of now.

    — Kaushik Khona

Revenue Mix

  • International Revenue as % of Total Revenue Revenue Mix · High confidence Increase
    We will continue to increase international revenue as a percentage of total revenue.

    — Prashant Kamat

  • Government vs International Business Mix Revenue Mix · within 3 years · High confidence 60-40 or 70-30 in favor of international business

    From 70-30 in favor of Government of India today

    We would like to be somewhere in 60-40, 70-30 in favor of international business to India business. And that's the target in which we are working right now... we will target to achieve this within 3 years.

    — Prashant Kamat

Profitability

  • Margins Profitability · High confidence Sustain or grow
    we expect the margins to sustain or maybe grow a bit.

    — Kaushik Khona

Taxation

  • Effective Tax Rate Taxation · all quarters · High confidence 22%
    we are at the same 22% and that 22% tax rate applies to us across all the quarters.

    — Kaushik Khona

Growth

  • Quarter-on-Quarter Growth Momentum Growth · High confidence Maintain
    We can tell you that we don't see any momentum reduction. We will continue to maintain our momentum.

    — Prashant Kamat

What to watch in Q2 FY26

Jal Jeevan Mission order inflow

next quarter
Current Orders on hold due to government audit
Target Audit completion and new orders materializing

Why it matters

Resolution of these delays is crucial for achieving the FY26 order book inflow target.

I guess that audit is coming to the -- towards the fag end, almost finishing and that pipeline should open now.

Risks & concerns

  • Delays in government projects (Jal Jeevan Mission, Vidarbha River linking)

    medium

    Government audits and systemization issues have caused delays in anticipated large orders and project execution, impacting order book growth velocity.

    Analyst acknowledged

  • Uncertainty and extended timelines for M&A activities

    low

    M&A processes typically do not adhere to optimistic timelines and can go back and forth, affecting the pace of inorganic growth.

    Management acknowledged

Q&A highlights

4 direct
Delays in large orders, specifically Jal Jeevan Mission Partial
The major orders we were anticipating were from Jal Jeevan Mission, which was government scheme. But probably you know government decided to take a stock of the situation and they wanted to do the audit, the entire program of Jal Jeevan Mission. And that's where they put everything on hold.

Analyst questioned the discrepancy between prior guidance on large orders and current reality, revealing government-induced delays impacting order inflow.

Asked by Garvit Goyal

Execution status of Vidarbha River linking project Partial
This project we started already execution. The number is nowhere close to INR150 crores. Again, it's not because of us. We are fully ready -- cranking to go. But because government wanted to systemize some of their side of the stock, the project took off slowly.

Clarified that execution has begun but is slower than anticipated due to external factors, impacting the expected revenue from this project.

Asked by Garvit Goyal

Update on inorganic growth opportunities (2 due diligence targets) Partial
Both of the things are moving pretty well. But you would probably appreciate that it is a M&A. So, timeline typically doesn't stay as optimistic as we would love to. Therefore, it will go back and forth. But both are positive, both are moving in good direction and both are at the stage of due diligence.

Provided an update on M&A progress, highlighting the inherent uncertainties and longer timelines in such deals.

Asked by Garvit Goyal

Reason for decreased margins in geospatial and engineering services Direct
geospatial have been, in this quarter at around 15%, 16%, while the margins for the technology solutions have been in the range of around 30%. And that's where we would like to build up more deliveries in the future.

Clarified the margin differential between segments and the strategic focus on higher-margin technology solutions to drive overall margin improvement.

Asked by Raj Saraf

Order booking slowdown and future outlook Partial
our order book was INR1,197 crores. And as we speak, it is INR1,209 crores. So, there is no reduction of the order book. But you are right that order book growth has been a little slow... we are also we have also kind of bid for other projects other than JJ Mission also, which are awaiting the final kind of approval.

Addressed concerns about order booking pace, explaining that while net growth was small, new bids are pending approval, indicating future potential.

Asked by Raj Saraf

Role of Surej K.P. in the current financial year and M&A Direct
Surej is the CEO Designate for the CS Tech as a whole. He will be taking over from me on January 1, 2026. And until then, yes, he is playing active role in all day-to-day operations as well as strategic initiatives of the company. If your question is, is he involved on a day-to-day decision-making review, operations? Answer is yes. Is he involved in M&A and is he actively participating? Answer is yes. In fact, some of these acquisitions are being driven by Surej personally.

Provided clarity on the leadership transition and Surej K.P.'s active involvement in strategic growth, including M&A.

Asked by Meet

Unbilled revenue percentage and cash flow situation Direct
This quarter's unbilled percentage will be in the range of around 50%, 51% -- 50% -- around 50%... we have already explained that there is a cash flow surplus of INR127 crores.

Provided specific operational metrics on unbilled revenue and reiterated the healthy cash surplus, addressing liquidity concerns.

Asked by Meet

Strategy to diversify risk from government project delays Direct
The -- another way to mitigate is obviously to try to reduce the percentage of the government business in the total, without reducing the actual numbers in the perspective. And that is being planned as a strategy by way of inorganic growth and focusing on international revenue

Outlined the company's long-term strategy to reduce dependency on government projects by expanding internationally and through inorganic growth.

Asked by Deekshant

2 min read 6 chapters

Detailed narrative

Record Q1 FY26 Financial Performance

Ceinsys Tech delivered a robust Q1 FY26, achieving its highest-ever quarterly performance. Operational revenues surged by 112% year-on-year to INR157 crores, while EBITDA grew by 130% to INR30 crores, with margins expanding by 140 basis points to 19.35%. Net profit saw a significant increase of 166% year-on-year, reaching INR32 crores, and the PAT margin stood at 20.18%. This strong performance was attributed to successful project execution and improved operational efficiency.

Strategic Shift Towards High-Margin Technology Solutions

The company's strategic emphasis on high-value digital initiatives is evident in the performance of its technology solutions segment. Revenue from technology solutions increased 2.74-fold from INR31 crores in Q1 FY25 to INR84 crores in Q1 FY26. This segment now contributes 54% to the total turnover, up from 51% in Q4 FY25. Management highlighted that technology solutions offer significantly higher margins (around 30%) compared to geospatial and engineering services (15-16%), driving overall profitability.

Order Book and Pipeline Health

As of June 25, the total order book stands at INR1,209 crores, up from INR1,197 crores at the beginning of the quarter. The company secured new contracts worth INR132 crores this quarter, including a INR115 crore MMRDA contract. Management targets an additional order book inflow of INR800-900 crores for FY26, with INR400 crores expected from Jal Jeevan Mission opportunities once government audits are resolved. The current order book is composed of INR765 crores from geospatial and INR445 crores from technology solutions.

Operational Efficiency and Cost Management

Ceinsys Tech demonstrated improved operational efficiency, with employee costs as a percentage of revenue declining to 23% in Q1 FY26 from 35% in the corresponding quarter last year. This reduction is attributed to better efficiency and the execution of more technology-driven projects. The company also reported an operational cash surplus of INR127 crores, indicating strong liquidity and cash flow management.

International Expansion and M&A Strategy

The company continues its focus on international expansion, aiming to increase international revenue as a percentage of total revenue, targeting a 60-40 or 70-30 mix in favor of international business within three years. This strategy involves both organic growth and inorganic growth through M&A. The company is currently pursuing two geospatial acquisition targets in the US and Europe, focusing on new technologies to enhance its capabilities.

Government Project Delays and Risk Mitigation

Management acknowledged delays in large government projects, such as the Jal Jeevan Mission and Vidarbha River linking project, due to government audits and systemization. While these delays impact order booking timelines, the company does not view them as a financial risk. To mitigate reliance on government projects, Ceinsys Tech is strategically expanding internationally and focusing on high-margin technology solutions.

This is an AI-generated summary of a publicly available earnings call transcript.
View original transcript

More Information Technology earnings calls