Rajesh Power — Q4 FY26 earnings call

Call held 23 Apr 2026

Management summary

Rajesh Power Services reported robust financial results for FY26, with revenue growing 52% to ₹1,628 crore and PAT increasing 48% to ₹143 crore. The company secured ₹2,743 crore in order inflows during FY26 and maintains a healthy unexecuted order book of ₹3,326 crore, offering good revenue visibility. A strategic entry into Battery Energy Storage Systems (BESS) with a 65 MW project in Gujarat marks a new growth engine, alongside continued expansion in transmission and distribution projects across multiple states.

Highlights

  • FY26 Revenue of ₹1,628 crore, up 52% YoY, driven by efficient project execution.

  • FY26 EBITDA of ₹197 crore, up 59% YoY, with EBITDA margin at 12.1%.

  • FY26 PAT of ₹143 crore, up 48% YoY, with PAT margin at 8.8%.

  • Unexecuted order book of ₹3,326 crores as of March 31, 2026, provides strong revenue visibility.

  • Strategic entry into Battery Energy Storage Systems (BESS) with a 65 MW / 130 MWh project in Gujarat, marking a new growth engine.

Concerns

  • Trade receivables jumped from INR 181 crores to INR 350 crores, leading to a higher number of days, though management attributes it to high March billing and expects normalization within 45-60 days.

  • L1 order book is only INR 210 crores, which is a small fraction of the total order book, with INR 2,200 crores in bids awaiting results.

Key financials

  1. Revenue ₹1,628 Cr +52%YoY
  2. EBITDA ₹197 Cr +59%YoY
  3. EBITDA Margin 12.1%
  4. PAT ₹143 Cr +48%YoY
  5. PAT Margin 8.8%
  6. Net Worth ₹406 Cr +53%YoY

What they filed

₹ Cr · quarterly
Line itemQ2 FY25Q4 FY25Q2 FY26Q4 FY26
Revenue313 759 638 990
EBITDA37 87 84 113
Net profit30 67 59 84
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

₹3,326 Cr

as of 2026-03-31 quantified

Inflow this quarter

₹2,743 Cr

Execution

executable over next 18 to 24 months

Composition

Mix 2 segments
  • Power Distribution 71%
  • Power Transmission 29%

Share of order book by segment

Pipeline

other

Targeted robust bid book of approximately INR 6000 crores, with INR 2,200 crores in bids awaiting results and a pipeline of INR 3,500 crores.

This healthy order book gives us strong revenue visibility for the coming quarters. The company is aggressively bidding for projects outside Gujarat to diversify its geographic concentration.

Source: Prepared remarks

Capital allocation

medium confidence
  • Capex Capex disclosed 70% to 80% financing by banks, rest by equity
    • BESS project investment ₹100 Cr
    So we are working currently with our lenders. In the range of, we'll do 70% to 80% financing by the banks, and rest will be equity by the company.
  • Debt Debt disclosed
    Our capital structure continues to remain comfortable, with the debt-equity ratio at 0.31 as of the period end, reflecting prudent leverage and financial discipline.

Guidance & targets

Revenue

  • Revenue growth Revenue · FY27 · High confidence 40%
    Yes. So, for the next FY’27, we are looking at a 40% growth.

    — Management

  • Revenue CAGR Revenue · next 3-4 years · Medium confidence 40%
    Okay. So, earlier we have mentioned, I think, over the next 3 years, 4 years, right, that this is the growth that we are looking at, right? Yes. Roughly.

    — Management

Margin

  • EBITDA Margin Margin · next 2-3 years · High confidence 11-12%
    Yes, we are confident on maintaining similar level of EBITDA and PAT margins. Roughly, EBITDA between 11% to 12% and PAT between 8% to 9%.

    — Management

  • PAT Margin Margin · next 2-3 years · High confidence 8-9%

    — Management

Order Book

  • Order Inflows Order Book · end of the year (FY27) · High confidence INR 4,000 to INR 5,000 crores
    So, we are targeting at further order inflows of roughly around INR 4,000 to INR 5,000 crores at the end of the year.

    — Management

  • Closing Order Book Order Book · FY27 · High confidence above INR 5,000 crores
    We are targeting somewhere above INR 5,000 crores of order book for FY27, closing.

    — Management

Geographic Expansion

  • Action on order book from outside Gujarat Geographic Expansion · next eight to 10 months · Medium confidence some action
    In the next eight months, roughly eight to 10 months, we should see some action on the order book of outside Gujarat.

    — Management

Project Timeline

  • BESS Project Commissioning Project Timeline · September 2027 or Q1 2027 · High confidence commissioned
    this project is to be completed by September 2027, the entire execution. And then the revenue will start post that. But we will try to execute maybe a bit earlier by Q1 of '27.

    — Management

Profitability

  • BESS Project IRR Profitability · project life · Medium confidence 10% to 12%
    So we are targeting an IRR of 10% to 12% in this project.

    — Management

What to watch in Q1 FY27

Normalization of Trade Receivables

next quarter (Q1 FY27)
Current INR 350 crores (up from INR 181 crores)
Target Back to ~60 days or lower

Why it matters

High receivables can impact cash flow and indicate working capital strain; management expects normalization soon.

The higher receivable is just a short-time phenomenon because of very high billing in the month of March... these numbers will again fall back to the genuine around 60 days for debtors.

Risks & concerns

  • Working Capital Strain due to High Receivables

    medium

    Trade receivables jumped from INR 181 crores to INR 350 crores, and short-term borrowing increased, but management states no stress on books and expects normalization within 45-60 days.

    Analyst downplayed

  • Geographic Concentration of Order Book

    medium

    Current order book is 85-90% from Gujarat, but management is aggressively bidding outside Gujarat to move towards an 80-20% split in the near term.

    Analyst acknowledged

  • Increasing Competitive Intensity

    medium

    Competitive intensity is increasing, but the company operates in specialized areas like underground cabling and GIS substations with fewer qualified players (3-6 competitors on average).

    Analyst acknowledged

  • Tender Result Delays Impacting Order Book Targets

    low

    INR 2,200 crore bids from Q4 FY26 are awaiting results, causing a temporary gap in reported order book versus previous targets, but it's not a 'shortfall' or 'slowdown'.

    Management acknowledged

Q&A highlights

6 direct
Jump in Trade Receivables and Working Capital Partial
The higher receivable is just a short-time phenomenon because of very high billing in the month of March... the only reason is because of higher billing in the month of March. So, that is why the receivables are showing a higher number at a year-end basis.

Highlights potential working capital strain, despite management's reassurance of normalization within standard payment terms, as the analyst noted a disproportionate jump.

Asked by Agastya Dave

BESS Project Strategy and Future Bidding Direct
Currently, we are not looking to bid for any more BESS projects. We are interested in bidding for more BESS EPC projects, where we see a lot of value addition.

Clarifies the company's strategic focus within the BESS segment, shifting from a developer role to prioritizing EPC opportunities.

Asked by Aniket Madhwani

Employee Cost vs. Revenue Scale Direct
No, sir, in FY '25, the employee cost is INR 43.9 CR, which has increased to INR 59 CR in FY '26.

Corrects a misunderstanding about employee cost trends, indicating an increase rather than a decrease, but still with efficiency gains due to increased scale.

Asked by Andrey Purushottam

Order Book Shortfall vs. Previous Guidance Direct
There is no shortfall. It's just the tender results are not out. So what we were targeting, we had bid in Q4, but the results are taking time to get out.

Explains the discrepancy between targeted and reported order book, attributing it to tender result delays rather than a lack of bidding activity or slowdown.

Asked by Mohit Arora

Order Book Composition (Gujarat vs. Other States) Direct
from a order book perspective, currently Gujarat is around 85% to 90%, and the rest is outside Gujarat. We are looking at very aggressive bidding for projects outside Gujarat. So eventually this number will start moving towards 80%-20%, in the near term.

Reveals the current high concentration of the order book in Gujarat and the strategic intent to diversify geographically to reduce risk.

Asked by Shravan Shah

Margin Profile in Niche Projects Partial
So what we are committing is not a decrease in margin, but a stabilized margin. That is what we are able to comment right now.

Despite entering niche, high-quality EPC projects, management is cautious about committing to higher margins, indicating competitive pressures or internal targets for stabilization.

Asked by Jainam Vora

Price Escalation Clause Effectiveness Direct
all our projects are covered by the price escalation clause for most of the items... As soon as the supply happens at a bigger price, the same time we also invoice to our customers with the new revised price. So there's no time gap, and that's how we are protected from market for any price variations.

Reassures investors about the company's ability to mitigate risks from raw material price volatility in its EPC projects.

Asked by Pushkar Jain

MSME Payment Terms and Working Capital Direct
we have a specific agreement with these parties, and they are okay sometimes with the payment terms of more than 45 days as an MSME. All, sir. Whoever has not agreed, we have released their payment within 45 days only, sir.

Clarifies the company's approach to MSME payments, indicating that extended terms are by agreement and not a general violation of mandates, addressing a potential working capital concern.

Asked by Mohit Arora

3 min read 7 chapters

Detailed narrative

Strong Financial Performance in FY26

Rajesh Power Services reported robust financial growth for FY26, with total revenue increasing by 52% year-over-year to ₹1,628 crore. EBITDA grew 59% to ₹197 crore, achieving a margin of 12.1%, while Profit After Tax (PAT) rose 48% to ₹143 crore, with a PAT margin of 8.8%. This performance contributed to a 99% CAGR in total revenue over the last three years (FY23-FY26), underscoring the scalability of the business model.

Healthy Order Book and Inflows

As of March 31, 2026, the company's unexecuted order book stood at ₹3,326 crore, providing strong revenue visibility for upcoming quarters. The power distribution segment accounts for 71% (₹2,365 crore) and transmission for 29% (₹961 crore) of this book. During FY26, Rajesh Power secured new order inflows totaling ₹2,743 crore, reflecting consistent wins across government, utility, and private sectors.

Strategic Entry into BESS and Market Expansion

Rajesh Power has strategically entered the Battery Energy Storage Systems (BESS) market, signing a 65 MW / 130 MWh standalone project in Gujarat. This move aims to understand the BESS value chain and position the company for future BESS EPC opportunities, which management sees as a new growth engine. The company is also expanding its transmission footprint beyond Gujarat, actively pursuing projects in Maharashtra, Orissa, and Jharkhand, with an aim to shift its Gujarat-centric order book from 85-90% to 80-20% in the near term.

Operational Efficiency and Project Execution

In FY26, the company significantly strengthened distribution networks by installing over 350 feeders, 4,000 ring main units, and 1,200 distribution transformers, alongside laying over 1,300 kilometers of cable. Management highlighted that MVCC and underground installations have led to a 70-80% reduction in interruption duration and significant reduction in HT faults. Projects are typically executed within 18 to 24 months, with several key projects commissioned during the year, including GIS substations in Jodhpur, Jaipur, and ATUL.

Working Capital Management and Receivables

The company's net worth increased by 53% YoY to ₹406 crore, and the debt-equity ratio remained comfortable at 0.31. While trade receivables saw a substantial jump from ₹181 crore to ₹350 crore, management attributed this to high billing in March and expects normalization to the standard 45-60 day payment terms. The company has also successfully negotiated improved credit terms with vendors, contributing to efficient working capital management.

Future Outlook and Addressable Market

Rajesh Power maintains a revenue growth guidance of 40% for FY27 and the next 3-4 years, with EBITDA margins expected to stabilize between 11-12% and PAT margins between 8-9%. The addressable market in Gujarat alone is estimated at ₹4,000-4,500 crore from GETCO transmission and ₹5,000 crore from distribution. Including other states and railway electrification, the overall addressable market for the company is projected to be around ₹14,000-15,000 crore in the coming future.

Specialized Capabilities and Competitive Edge

The company emphasizes its specialized expertise in underground cabling and GIS substations, which limits the number of qualified competitors (3-6 players on average). This niche focus, combined with bulk material procurement and established vendor relationships, ensures a comfortable gap between consumption capacity and manufacturing availability, mitigating supply chain challenges. The company is also venturing into 400 kV GIS and pursuing opportunities in the 765 kV segment.

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

More Utilities earnings calls