BEML Ltd — Q2 FY26 earnings call

Call held 12 Dec 2025

Management summary

BEML is transitioning into a high-growth phase driven by a robust ₹16,300 crore order book, primarily in Rail, Metro, and Defense. While the Mining segment faces structural shifts due to Coal India's MDO model, the company is diversifying into Maritime Cranes and high-end underground mining. Management maintains a confident outlook with 20% revenue growth guidance for FY26, supported by peak execution in major metro projects starting FY27.

Highlights

  • Current order book stands at approximately ₹16,300 crores, with a target to exceed ₹20,000 crores by year-end.

  • Management provided a revenue growth guidance of 20% for FY26, citing 30% as a challenge.

  • Defense segment is expected to grow by 70% to 80% in the current financial year after doubling last year.

  • Rail and Metro segment accounts for 65% of the order book, followed by Defense at 30% and Mining at 5%.

  • New entry into the Maritime Crane segment targeted to generate ₹4,000-5,000 crores in revenue over the next 4-5 years.

  • Bangalore Metro project entering bulk production with 8-10 trains expected to be supplied in the current FY.

  • Strategic shift in Defense from high-mobility vehicle supplier to complete systems provider through a new Strategic Systems SBU.

Key financials

  1. Order Book ₹16,300 Cr
  2. Defense Revenue Growth 75% +75%YoY
  3. Mining Growth Guidance 4% +4%YoY

What they filed

Q1 FY27: revenue up 29.3%, net profit up 57.8% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue860 876 1,653 634 839 −2%1,083 +24%1,794 +9%820 +29%
EBITDA73 60 423 -48 73 +0%4 −93%272 −36%2 +104%
Net profit51 25 288 -64 55 +8%-23 −192%179 −38%-27 +58%
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

  • Rail and Metro
    65% Order Book Contribution19% Revenue Contribution FY25
  • Defense and Aerospace
    30% Order Book Contribution75% Expected Revenue Growth
  • Mining and Construction
    5% Order Book Contribution4% Annual Growth Target

Guidance & targets

Revenue

  • Total Revenue Growth Revenue · FY26 · High confidence 20%
    30% growth will be a challenge. 20% should be achievable. 20% guidance, I said, that is, achievable. 20% should be there in FY26.

    — Management

  • Defense Revenue Growth Revenue · Current FY · High confidence 70-80%
    This year itself, we are expecting at least a 70% to 80% growth in the defense revenue.

    — Management

  • Maritime Crane Revenue Potential Revenue · by 2030 · Medium confidence ₹4,000-5,000 crores
    So, maybe 4 or 5 years down the line. This particular line will give 4,000 crore plus.

    — Management

Other

  • Order Book Size Other · End of FY26 · High confidence ₹20,000 crores+

    From ₹16,300 crores today

    from the current order book of Rs Rs. 16,300 Crs, we should end the year with Rs 20,000 Crs plus order book

    — Management

Risks & concerns

  • Structural shift in Coal India's acquisition model

    medium

    Shift from departmental purchase to MDO model favors lower-end equipment and OpEx over BEML's high-end CapEx offerings.

    Management acknowledged

  • Supply chain disruptions

    medium

    Management noted that the recent train unveiling could have happened two months earlier if the supply chain had supported them.

    Management acknowledged

  • Revenue Seasonality

    low

    First two quarters are generally dull; heavy pressure on Q3 and Q4 for revenue delivery.

    Management acknowledged

Q&A highlights

3 direct
Three-year outlook and Maritime opportunity Direct
In the next 3 years, the focus and key drivers will be the Rail and Metro vertical, the Defense and Aerospace vertical. Mining should remain flat... maritime crane is entirely a new area... this itself will give us a revenue of around 4,000 to 5,000 crore.

Confirms the shift in growth drivers away from traditional mining toward high-value engineering segments.

Asked by Unidentified Analyst

Growth Guidance for FY26 Direct
30% growth will be a challenge. 20% should be achievable. 20% guidance, I said, that is, achievable. 20% should be there in FY26.

Provides a realistic baseline for investor expectations regarding top-line expansion.

Asked by Unidentified Analyst

AMCA Program and Consortium Strategy Direct
We have participated with Bharat Forge and Data Patterns... Our role in this is basically considering our core strength in the aerostructures.

Highlights BEML's collaborative approach to high-tech defense projects, mitigating individual R&D risk.

Asked by Unidentified Analyst

2 min read 5 chapters

Detailed narrative

Rail and Metro: The Primary Growth Engine

The Rail and Metro segment is BEML's largest vertical, constituting 65% of the ₹16,300 crore order book. After a temporary dip in FY25 contribution to 19% due to execution cycles, management expects a 'quantum jump' in revenue as major projects like the Bangalore Metro (53+ trains) enter bulk production. FY27-28 is projected to be a peak period with three major metro projects (Bangalore, Chennai, Mumbai) running in parallel.

Defense Transformation to Systems Provider

BEML is shifting from being a high-mobility vehicle supplier to a complete systems provider, evidenced by the creation of the 'Strategic Systems' SBU. Defense revenue is expected to grow by 70-80% in the current year, following a doubling of revenue in the previous year. Key upcoming bulk production items include mechanical minefield marking equipment and self-propelled mine barriers, with a major 'big ticket' order for Pinaka regiments expected next year.

Strategic Entry into Maritime Cranes

The company is leveraging its fabrication and hydraulics expertise to enter the maritime crane market, targeting both shipbuilding (Goliath) and port operation (ship-to-shore) cranes. Management estimates a domestic requirement of 50 ship-to-shore cranes annually, which could generate ₹4,000-5,000 crores in revenue over the next 4-5 years. The strategy involves a graded approach, starting with contract manufacturing before moving to a dedicated waterfront facility.

Mining Segment Facing Structural Headwinds

The Mining vertical, once a core driver, is expected to remain relatively flat with 3-5% annual growth. The primary challenge is Coal India's shift toward the Mine Developer and Operator (MDO) model, where contractors prefer lower-end equipment or second-hand machinery. To counter this, BEML is partnering with Tesmec (Italy) for surface miners and seeking partners for underground mechanized mining, where production is expected to jump from 25 million to 200 million tons in 5-6 years.

Order Book and Revenue Seasonality

BEML aims to end the current year with an order book exceeding ₹20,000 crores, up from the current ₹16,300 crores. Management is actively working to reduce over-dependence on Coal India to mitigate revenue seasonality, as the first two quarters are traditionally dull. A robust pipeline in Rail and Defense is intended to ensure more equitable revenue distribution across all four quarters starting from day one of the financial year.

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