Markolines Pavem — Q3 FY26 earnings call

Call held 11 Mar 2026

Management summary

Markolines Pavement Technologies reported strong Q3 and 9M FY26 results with double-digit growth in revenue and profit. The company boasts a healthy unexecuted order book of Rs. 695 crores and aims for substantial growth in FY27 and beyond, targeting Rs. 1000 crores revenue in three years. Strategic initiatives include direct bidding with NHAI and the ongoing merger of Markolines Infra, positioning the company for future expansion despite challenges like monsoon impact and raw material costs.

Highlights

  • Q3 FY26 Revenue grew 16% YoY, demonstrating continued top-line expansion.

  • Q3 FY26 PAT increased 11% YoY, with 9M FY26 PAT up 42% YoY, indicating strong profitability.

  • Current unexecuted order book of Rs. 695 crores provides significant revenue visibility.

  • Secured Rs. 439 crores in new orders, contributing to a robust pipeline.

  • Strategic move to opt for direct bidding with NHAI is expected to yield better margins and visibility.

Concerns

  • Monsoon season significantly impacts execution, leading to lower business in Q2.

  • Raw material cost escalation, though mitigated by clauses, remains a potential risk.

Key financials

3 periods

Q3

  • Revenue Growth
    16%
    YoY +16%
  • EBITDA Growth
    16%
    YoY +16%
  • PAT Growth
    11%
    YoY +11%
  • EPS
    ₹3.33
    YoY +19%

9M

  • Revenue Growth
    30%
    YoY +30%
  • EBITDA Growth
    29%
    YoY +29%
  • PAT Growth
    42%
    YoY +42%
  • FY26 Sales
    ₹230 Cr

FY25

  • Sales
    ₹300 Cr
  • PBT
    ₹29.86 Cr

What they filed

Q1 FY27: revenue down 15.3%, net profit up 15.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue56 80 115 73 78 +40%80 +0%93 −19%62 −15%
EBITDA6 8 19 7 7 +20%10 +33%16 −15%7 −5%
Net profit2 6 12 4 4 +66%7 +13%11 −8%4 +15%
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.

Order book

high confidence

Total value

₹695 Cr

as of 2026-03-14 quantified

Inflow this quarter

₹439 Cr

Execution

average 9-12 months considering monsoon for major maintenance sites

Pipeline

deal pipeline tcv

Order pipeline target

We are looking at building a Rs. 1000 crores of order pipeline in very short time. We would have a Rs. 300 crores to Rs. 600 crores of unexecuted order book and another Rs. 300 crores to Rs. 500 crores as in pipeline.

Source: Prepared remarks

Capital allocation

high confidence
  • M&A Markolines Infra Merger · Pending regulatory

    Merger of Markolines Infra and Markolines in the micro pavement segment, started with a single product, good relationship, disciplined work, number one position.

    we have also announced the merger of Markolines Infra and Markolines in the micro pavement. Now basically what is Markolines, basically is because we started with a single product, we share very good relationship and because of the disciplined work, we have really advantage and put in ourselves as number one

Guidance & targets

Revenue

  • FY26 Sales Target Revenue · FY26 · High confidence Rs. 375-400 crores
    And we will be able to maintain a very good growth, we are looking at a target of about Rs. 375 crores to Rs. 400 crores this year.

    — Vijay Oswal

  • FY27 Revenue Growth Revenue · upcoming financial year · High confidence 40-50%
    we are expecting about 40% to 50% growth in the upcoming financial year which will really put us into the bigger transition.

    — Vijay Oswal

  • Next 3 Years Revenue Target Revenue · next three years · High confidence Rs. 1000 crores
    we are looking at the Rs. 1000 crores of revenue in coming three years.

    — Vijay Oswal

  • Q1 Turnover Percentage Revenue · Q1 · High confidence ~20%
    So, Q1 would be approximately 20%.

    — Vijay Oswal

  • Q4 Turnover Percentage Revenue · Q4 · High confidence 30-40%
    our sales really pick up in Q3s and Q4s. By and large we do about 30% to 40% of our entire business, probably at times more also in last only one quarter

    — Vijay Oswal

Order Book

  • Unexecuted Order Book Maintenance Order Book · ongoing · High confidence 150% of last year's turnover
    we have been able to maintain at least 150% of our last year's turnover as an unexecuted order book by and large.

    — Vijay Oswal

Strategy

  • Direct Bidding with NHAI Strategy · from this year · Medium confidence Opt for direct bidding
    So, from this year we are planning that we would also opt for the direct bidding with NHAI and this will also give us better margins, longer visibility, stronger visibility and good performance on the road.

    — Vijay Oswal

What to watch in Q4 FY26

Markolines Infra Merger Status

Next 6-9 months (initial update expected next quarter)
Current Resubmitted, pending regulatory approval
Target Regulatory approval / further progress

Why it matters

Completion of merger is a key strategic event impacting company structure and future operations.

So, we have now resubmitted the things, in next 10-15 days all the entire proposal schemes detailed documents will be also submitted to this thing and we are expecting that now this time it should go through in about 6 to 9 months maximum.

Risks & concerns

  • Raw material cost escalation

    medium

    Crude and bitumen prices can increase, but contracts include escalation clauses to mitigate impact.

    Management acknowledged

  • Monsoon impact on execution

    medium

    Monsoon season (June-September) leads to business halts or reductions, impacting execution timelines.

    Management acknowledged

Q&A highlights

7 direct
FY26 Sales and Margin Expectations Direct
And we will be able to maintain a very good growth, we are looking at a target of about Rs. 375 crores to Rs. 400 crores this year. Margin side, I have always been saying that our business being the competitive and since there is no rocket signs, we are subject to that. So, it is a volume game, so that is what we say our margins will remain always same.

Analyst sought clarity on full-year revenue and profitability given 9M performance, and management provided specific sales guidance and reiterated margin strategy.

Asked by Rajendra Saboo

Merger Completion Timeline Direct
Sir what happened is actually we had filed it before also but because of some technical reasons, they had asked us to resubmit and for the resubmission obviously we had to update everything with respect to the financials closure up to December. So, we have now resubmitted the things, in next 10-15 days all the entire proposal schemes detailed documents will be also submitted to this thing and we are expecting that now this time it should go through in about 6 to 9 months maximum.

Analyst inquired about the status and timeline of the Markolines Infra merger, a significant corporate action.

Asked by Rajendra Saboo

Marquee Client Names Direct
Now when I say Cube Highways, Cube Highways is the highway arm for the E-Square Capital. Which is a pension fund and owns the highest number of projects in India. So, now if I have to talk about Cube Highways, they own about 28 to 30 projects and we keep working with them for various projects and similar is the case like we work with Interise, Next, Tatas, Roadies, Vertis, Safeway, L&T. And as far as government is concerned, we have worked with NHAI, then we also work with some of the corporations like BMC or Pune Municipal Corporation, Mumbai Municipal Corporation.

Analyst sought to understand the company's client base, and management provided a comprehensive list of key private and government clients.

Asked by Nikhil Mistry

Business Cyclicality, Competition, and Stickiness Direct
Markolines is just not a contractor wherein we just build and put in the bids for their enquiries. At times we go and suggest them the comprehensive tailor-made solutions which could be cost economical, all the alternate type of maintenances wherein it would have a better performance, longer life and lesser cost and as well as the environmental friendly. So, this is what gives us an advantage over competition.

Analyst questioned the nature of the business, and management explained their competitive advantages, including technology and comprehensive solutions, which drive client stickiness.

Asked by Sandeep Bhandari

Execution Run Rate and FY27 Order Inflow Direct
as of today, if I have to talk to you, today we have an unexecuted order book of Rs. 695 crores out of which Rs. 413 crores is the new order that is coming. Now out of this Rs. 695 crores odd of orders, approximately we are planning to do about Rs. 500 crores of work will be done in the next financial year, let us say. ... we have been able to maintain at least 150% of our last year's turnover as an unexecuted order book by and large.

Analyst sought clarity on project execution pace and future order book expectations, which management addressed with specific figures and targets.

Asked by Nikhil Mistry

Indian Road Infrastructure Sector Growth and Key Risks Direct
Indian roads as I already mentioned, India has the second largest road network comprising of what 6 million kilometers. Now out of that, the national highway since we majorly work on national highway. National highway comprises about 1,30,000 kilometers to 1,40,000 kilometers and we are currently adding 34 kilometers per day in terms of this road. ... Now as far as risks are concerned, so risk would be generally what are the risks if I calculate the major would be, one is the cost. Now raw material cost for which we generally have the escalation clauses inbuilt into the, what do you say the work order itself so that we do not bear the differential cost in case.

Analyst asked about the broader industry outlook and potential risks, leading to management's insights on sector growth and their strategy for mitigating raw material cost risks.

Asked by Nilesh Deshpande

Markolines Infra Amalgamation Valuation Direct
So, Markolines Infra we have already submitted this thing and in another 10 days we will be filing the detail. See what happens is the, for Markolines Infra valuation is based on the DCF by SEBI approved values and secondly, particularly for the listed entity it is governed by the market pricing and based on that the ratio is calculated. It is not me or at the, what we say, the wish of the management it does not happen, it is weighted and approved by a panel of consultants, the SEBI approved valuers and based on that these ratios have been calculated.

Analyst questioned the valuation methodology for the Markolines Infra merger, and management clarified the regulatory-approved process and basis for valuation.

Asked by Arvind Deshpande

2 min read 7 chapters

Detailed narrative

Q3 and 9M Performance Overview

Markolines Pavement Technologies Limited reported a robust Q3 FY26, with revenue growing 16% year-on-year, EBITDA also up 16% year-on-year, and PAT increasing by 11% year-on-year. EPS rose 19% from Rs. 2.79 to Rs. 3.33. For the nine months ended December 31, 2025, revenue grew 30% year-on-year, and PAT saw a significant 42% increase, demonstrating strong financial performance and parallel profitability.

Order Book and Future Visibility

The company currently holds an unexecuted order book of Rs. 695 crores as of March 14, 2026, which includes Rs. 439 crores in recently secured orders. Management aims to build a Rs. 1000 crore order pipeline in the short term and expects to execute approximately Rs. 500 crores of the current order book in the next financial year. This strong order book, coupled with a pipeline of Rs. 300-500 crores, provides clear revenue visibility for the upcoming periods, with an average project completion cycle of 9-12 months.

Business Model and Technology Advantage

Markolines, founded in 2002, has evolved into a comprehensive provider of highway maintenance products and services. They leverage new technological advanced techniques such as micro-surfacing and Cold In Place Recycling, which are environmentally friendly and cost-effective. The company's specialized construction services, including soil stabilization and tunneling, further differentiate it, with two ongoing tunnel projects worth Rs. 450 crores in conjunction.

Industry Outlook and Growth Drivers

The Indian infrastructure sector, particularly roads, is experiencing high growth, with the national highway network expanding by 34 kilometers per day. The government's focus on monetizing assets through PPP models (like TOT) creates significant opportunities. Markolines, with its Pan-India presence and strong client relationships with major funds (e.g., Cube Highways, L&T, Tatas) and government bodies (e.g., NHAI, BMC), is well-positioned to capitalize on this growth.

Merger Update

The merger of Markolines Infra and Markolines in the micro pavement segment, effective January 1, 2026, is in progress. Following a resubmission due to technical reasons, the company expects the regulatory process to conclude within 6-9 months. The valuation for Markolines Infra was based on SEBI-approved DCF and market pricing, with detailed documents to be filed within 18 days.

Risk Mitigation and Margin Sustainability

The company operates in a competitive, volume-driven business. Key risks include raw material cost escalation (e.g., crude, bitumen), which is mitigated by incorporating escalation clauses in contracts and selective bidding. Monsoon season (June-September) impacts execution, leading to lower business in Q2, but the company is adapting by exploring work in rain shadow areas. Margins are maintained through transparent operations and a focus on volume growth.

Future Growth Strategy

Markolines is targeting 40-50% revenue growth in the upcoming financial year (FY27) and aims to achieve Rs. 1000 crores in revenue within the next three years. A strategic shift includes directly bidding for larger projects with NHAI, leveraging their credentials from tunnel projects. This is expected to lead to better margins, longer visibility, and stronger overall performance, contributing to a bigger transition for the company.

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

More Construction earnings calls