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Bondada Engineering Limited — Q2 FY26 earnings call

Call held 3 Nov 2025

Company page: Bondada Engineering share price, financials & guidance record

Management summary

Bondada Engineering reported strong H1 FY26 results with significant revenue and net profit growth, driven by robust order execution in renewable energy and telecom. The company is strategically expanding into BESS, Data Centers, and Defence, backed by a healthy order book and a strong balance sheet. While operating cash flow was negative, management is focused on improving it by year-end.

Highlights

  • H1 FY26 Revenue of ₹1,216 crores, up 153% YoY from ₹480 crores (H1 FY25).

  • H1 FY26 Net Profit of ₹92 crores, up 155.56% YoY from ₹36 crores (H1 FY25).

  • EBITDA margin maintained at ~12% for H1 FY26.

  • Order book stands at ₹6,000 crores, with an additional ₹2,600 crores in L1 status, providing strong revenue visibility.

  • Debt-equity ratio improved to 0.3 from 0.35 last year, with no long-term debt, and cash conversion cycle improved from 110 days to 90 days.

Concerns

  • Operating cash flow for H1 FY26 was negative ₹43 crores.

  • Trade receivables are high at ₹700 crores (57% of H1 revenue), though management clarified this includes retention money and debtor days have improved to 107.

  • Seasonality impact in Q2 (July-September) due to monsoon affecting project deliveries, though managed this year.

Key financials

  1. Revenue ₹1,216 Cr +153.3%YoY
  2. EBITDA ₹143 Cr
  3. EBITDA Margin 12%
  4. Net Profit ₹92 Cr +155.6%YoY
  5. EPS ₹8.03
  6. Debt-Equity Ratio 0.3
  7. ROCE 30%
  8. ROE 30%
  9. Operating Cash Flow ₹-43 Cr

What they filed

Q1 FY27: revenue up 24.0%, net profit up 28.6% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue481 376 714 558 659 +37%712 +89%914 +28%692 +24%
EBITDA51 38 82 65 78 +53%85 +124%96 +17%78 +20%
Net profit37 25 56 42 52 +41%54 +116%63 +13%54 +29%
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

  • Renewable Energy
    78% Revenue Share
  • Telecom
    10% Revenue Share
  • Products
    8% Revenue Share

Order book

high confidence

Total value

₹6,000 Cr

as of 2025-10-28 quantified

Execution

Renewable energy contracts executable over 2 years; Telecom EPC 6-8 months, O&M 5-6 years; Railways 15 months; Solar projects 15-18 months.

Composition

Mix 4 segments
  • Renewable Energy 76.2%
  • Telecom 16.7%
  • Indian Railways 3.8%
  • Products 3.2%

Share of order book by segment

Pipeline

L1 awaiting loa

L1 status for orders worth ₹2,600 crores; Tenders submitted for ₹7,500 crores with expected 25% winning ratio.

Expected closing order book of INR8,500-9,000 crores by March 2026, driven by current order book and L1 bids.

Source: Prepared remarks

Capital allocation

high confidence
  • Capex Capex disclosed Internal accruals for Defence CapEx
    • Defence sector entry (IP-centric acquisitions) ₹75 Cr
    • Defence sector entry (IP-centric acquisitions) ₹100 Cr
    So we are not anticipating anything more than INR75 crores to INR100 crores of CapEx in defence, which our business will be centred around more on IP-centric business, on high value product, but the low capital infusion... Yeah, this will also come, maybe as per our estimation, actually, will come around INR75 crores to INR100 crores. That can be managed internal accrual CapEx.
  • Debt Debt disclosed
    Even after considering working capital debt also, our debt-equity ratio is 0.3, as against last year's 0.35. It's almost intact. If we consider that only long-term debt, there is hardly any debt-equity ratio... So the company has huge appetite to raise that term loan debt at this point of time. So based on the requirements, based on the implementation phases, we will be raising debt as per the requirements of the project.
  • M&A Undisclosed companies with valuable IP Acquisition · Announced · Consideration ₹[object Object] (undisclosed)

    To enter the defence sector with low capital infusion and acquire valuable IP.

    we are looking at acquiring a few companies which have a very valuable IP and which comes to you at an affordable price. So as our CMD mentioned, in a short while you will hear an announcement from us in the areas in which we are foraying into, and then what are the acquisitions that we are doing, and then what are the tie-ups that we are going to have with the tier one vendors of defence.
  • Liquidity Liquidity disclosed Operating cash flow for H1 FY26 was negative ₹43 crores, with efforts to achieve positive cash flow by March 2026.
    our operating cash flow for the first half year is minus INR43 crores, INR43 crores negative. And we are striving hard even to have positive cash flow by March 2026. And our efforts is always on for that.

Guidance & targets

Vision

  • Renewable Energy Capacity Vision · by 2030 · High confidence 25 GW
    So this is what our Vision 2030 is to achieve 25 gigawatt of renewable energy, which includes solar EPC, solar IPP and even BESS.

    — Dr. Raghavendra Rao Bondada

  • Company Size Vision · by 2030 · High confidence $1 billion
    Finally, we would like to have become $1 billion company by 2030, by doing all these things and 25 gigawatt of renewable energy deployment.

    — Dr. Raghavendra Rao Bondada

Revenue

  • Revenue Growth Revenue · by FY26 end · High confidence Double
    Your point is taken. I had one more question. You are envisaging to double your revenues by the current financial year end and tripling the revenues by financial year '27 end. That would mean revenues close to around INR4,500 crores by financial year '27 end. Are you confident of achieving this target?

    — Vinod Kumar

  • Revenue Growth Revenue · by FY27 end · High confidence Triple

    — Vinod Kumar

  • H2 Revenue Share Revenue · FY26 · High confidence 60%
    60% of our target for this year will come in second half.

    — Dr. Raghavendra Rao Bondada

Profitability

  • PAT Margin (EPC) Profitability · Ongoing · High confidence 7.5%
    In EPC contracts, we have a PAT of 7.5%, PAT of 7.5%.

    — Dr. Bondada Raghavendra Rao

  • PAT Margin (O&M) Profitability · Ongoing · High confidence 10%
    And even O&M services, a little bit high, which is almost around 10%.

    — Dr. Bondada Raghavendra Rao

  • PAT Margin (Products) Profitability · Ongoing · High confidence 10%
    Products is around 10%.

    — Dr. Bondada Raghavendra Rao

  • Overall PAT Margin Profitability · Ongoing · High confidence 7.5-7.6%
    But majority of EPC is at 7.5%.

    — Dr. Bondada Raghavendra Rao

  • EBITDA/PAT Margin Improvement Profitability · Ongoing · Medium confidence 100 bps
    Maybe 100 base points increase will be there because of large scale operations, because economy of scale, because slowly, slowly, quarter on quarter, actually, our size of the projects are increasing.

    — Dr. Raghavendra Rao Bondada

ROCE

  • ROCE Improvement ROCE · Ongoing · Medium confidence 3-5%
    Vaibhav, definitely we can expect in terms of return on capital employed improvement for the ongoing projects and upcoming projects. When you consider it as a standalone EPC ROCE. We are expecting return on capital employed improvement by about 3% to 5% for the existing ROCE, on an EPC model basis.

    — Dr. Bondada Raghavendra Rao

Solar EPC Capacity

  • Commissioned Capacity Solar EPC Capacity · FY26 · High confidence 1 GW
    Now this year, standalone, this year itself, we are planning for 1 gigawatt.

    — Dr. Raghavendra Rao Bondada

  • Commissioned Capacity Solar EPC Capacity · FY27 · Medium confidence 2 GW
    Maybe next year, we may increase it to the 2 gigawatt.

    — Dr. Raghavendra Rao Bondada

BESS Growth

  • CAGR BESS Growth · next 5 years · High confidence 100%
    This will go 100% CAGR. This order book and even execution will go. Even I am very optimistic at this point of time. So it can go more than 100% CAGR in next 5 years time.

    — Dr. Raghavendra Rao Bondada

Revenue Mix

  • Renewable Energy Share Revenue Mix · next 2-3 years · High confidence 80%
    as of now, currently, we are operating around 80% is coming from renewable energy, 10% is coming from telecom, and another 10% is coming from our products, other products. So this will continue. This will continue like this for next two to three years on today's condition, on today's situation.

    — Dr. Raghavendra Rao Bondada

  • Telecom Share Revenue Mix · next 2-3 years · High confidence 10%

    — Dr. Raghavendra Rao Bondada

  • Products Share Revenue Mix · next 2-3 years · High confidence 10%

    — Dr. Raghavendra Rao Bondada

New Segment Revenue Recognition

  • Data Center and Defence Revenue New Segment Revenue Recognition · Q3 FY27 · Medium confidence Start
    You can see some revenues are flowing in our books, maybe in the third quarter of '26-'27 next year.

    — Dr. Raghavendra Rao Bondada

What to watch in Q3 FY26

Data Center and Defence business plans

After two quarters (Q4 FY26 or Q1 FY27)
Current Brainstorming, pursuing, no concrete announcements yet.
Target Specific business plans, acquisition announcements, or tie-ups.

Why it matters

These are new growth segments that could diversify revenue and contribute significantly to the company's $1 billion vision.

So as I mentioned, data centres also we are pursuing now and even defence and aerospace also we are seriously pursuing that but not much done work in this actually but maybe next one quarter or two quarters we'll come back to and tell that actually what is that our business plan and how we are how we what kind of revenue numbers or what kind of growth we are looking at in these two segments we will come back to you later.

Risks & concerns

  • Seasonality Impact on Project Deliveries

    medium

    Q2 (July-September) typically faces challenges due to monsoon, impacting project deliveries, though the company managed to keep projects intact this year.

    Management acknowledged

  • Working Capital Management / High Trade Receivables

    medium

    Trade receivables are high at ₹700 crores, including ₹130 crores in retention money. While debtor days have improved to 107, operating cash flow for H1 FY26 was negative ₹43 crores.

    Analyst acknowledged

  • Technology Disruption in BESS

    medium

    BESS technology (lithium-ion) is rapidly changing, and India is currently dependent on China for cells, posing a potential risk of technological obsolescence or supply chain issues.

    Analyst acknowledged

Q&A highlights

6 direct
Asset-light vs Capital-intensive model (IPP, Defence) and funding strategy Direct
Out of this 25 gigawatt, Gandhiji, actually what we are planning is about close to 21 gigawatt, we will be doing the EPC projects only in terms of solar plants and in terms of BESS EPC. And 2 gigawatt of solar park and 2 gigawatt of BESS we are going to establish on our own, which needs definitely capital requirement... not going to happen overnight. It's going to happen over a period of next five years. And we are planning in a way that we are going to have a phased manner implementation... as of now, we have a almost a net worth of INR610 crores against which we don't have any term loan. So the company has huge appetite to raise that term loan debt at this point of time... even we are ready to even dilute the equity to the extent it is required based on that time's actual capital requirement.

Clarifies the company's strategic shift towards capital-intensive IPP/BOO models for a smaller portion of its targets, outlining a phased funding approach using debt and potential equity dilution.

Asked by Hardik Gandhi

Defence sector entry strategy and CapEx requirements Direct
your suggestion that the defence requires a very high capital infusion is in general correct, but that depends on the kind of areas that you select to foray into. So we've been extremely cautious, not getting into very highly capital intensive areas... we are looking at acquiring a few companies which have a very valuable IP... not anticipating anything more than INR75 crores to INR100 crores of CapEx in defence, which our business will be centred around more on IP-centric business, on high value product, but the low capital infusion.

Details the company's cautious, IP-centric approach to entering the defence sector, emphasizing low capital outlay through acquisitions rather than greenfield manufacturing.

Asked by Hardik Gandhi

Order book execution timeline and sustainability of margins Direct
our company always reports actually 40% of revenues in first half... 60% of our target for this year will come in second half... I'm very much comfortable and confident that actually that 60% of our target can be delivered in second half... I think we are going to sustain both EBITDA, PBT or PAT margins. Maybe 100 base points increase will be there because of large scale operations, because economy of scale.

Reassures investors about the company's ability to achieve its annual revenue targets in H2 and maintain/improve margins due to increasing scale and operational efficiency.

Asked by Urmish Shah

High trade receivables and efforts to reduce them Direct
trade receivables is at around INR700 crores... out of the INR700 crores, around almost INR130 crores is our retention money... last year, 31 March, 2025, we had about 125 days receivables, whereas in this first half year, we have managed to bring it down to 107 days... we are not finding any cash trends.

Addresses concerns about working capital by explaining the composition of receivables (including retention money) and highlighting the improvement in debtor days.

Asked by Vinod Kumar

Adani opportunity in Khavda and BESS backward integration plans Partial
Actually we are discussing with Adani anything between 3 gigawatt to 4 gigawatt in next 4 years of time... first initial order is 650 megawatt... Next 3 to 4 years anything between up to 4 gigawatt we can deliver... BESS... that's where actually very serious work is going on. That also please give us some more time. We will come back to you. Whatever we are talking about actually that battery backward integration, not only just our BESS applications but our power transition application that will also be used for our defence applications.

Highlights a significant potential order pipeline from Adani and indicates strategic plans for BESS backward integration, though specific details are pending, suggesting future announcements.

Asked by Darshit Shah

BESS project setup timeline and cost per megawatt Direct
Once we agree the contract once we make the BESS buy agreement with the customer, actually, they will give around 15 months to 18 months time... DC side anything between INR1 crore to INR1.2 crore per megawatt hour... per megawatt it is existing in between 2.5 to 3 [crores].

Provides specific timelines and cost estimates for BESS projects, offering clarity on the execution and financial aspects of this growing segment.

Asked by Heet Modi

Future revenue bifurcation and timeline for Data Center/Defence contribution Direct
as of now, currently, we are operating around 80% is coming from renewable energy, 10% is coming from telecom, and another 10% is coming from our products... This will continue like this for next two to three years... if my data centres and defence is also adding in subsequent quarters that may slightly change... after two quarters... maybe Q3 FY27 next year.

Offers a clear picture of the current and near-term revenue mix, indicating when new segments like Data Centers and Defence are expected to start contributing meaningfully to the top line.

Asked by Archit Agarwal

2 min read 6 chapters

Detailed narrative

H1 FY26 Financial Performance Highlights

Bondada Engineering reported a robust H1 FY26 with revenue reaching INR1,216 crores, marking a substantial 153% year-over-year increase from INR480 crores in H1 FY25. Net profit also saw significant growth, rising 155.56% YoY to INR92 crores from INR36 crores. The company maintained healthy EBITDA margins close to 12% and improved its annualized Return on Capital Employed (ROCE) and Return on Equity (ROE) to approximately 30% each, reflecting strong operational efficiency.

Strong Order Book and Future Pipeline

As of October 28, 2025, Bondada Engineering's order book stands at INR6,000 crores, complemented by an additional INR2,600 crores in L1 status, awaiting Letters of Award. The order book composition includes INR4,573 crores from renewable energy, INR1,000 crores from telecom, and INR228 crores from Indian railways. Management projects a closing order book of INR8,500-9,000 crores by March 2026, indicating strong revenue visibility and continued business momentum.

Strategic Diversification and Growth Initiatives

The company is actively diversifying its business into Battery Energy Storage Systems (BESS), Data Centers, and Defence, aiming for 2 GW each in BESS and Solar IPP under a phased capital-intensive model over the next five years. For the defence sector, Bondada plans a cautious, IP-centric entry with an initial CapEx of INR75-100 crores, focusing on acquiring valuable intellectual property rather than large-scale greenfield manufacturing. These new segments are expected to contribute to the company's Vision 2030 target of becoming a $1 billion entity.

Operational Efficiency and Capital Management

Bondada Engineering demonstrated improved operational efficiency by reducing debtor days from 125 to 107 and the cash conversion cycle from 110 to 90 days. The company's debt-equity ratio improved to 0.3 from 0.35 last year, with no long-term debt, indicating a strong balance sheet. Despite a negative operating cash flow of INR43 crores in H1 FY26, management is committed to achieving positive operating cash flow by March 2026 through continued focus on collections and project execution.

BESS Market Opportunity and Execution

The company sees a significant opportunity in the BESS market, evidenced by an INR850 crores order book and an anticipated 100% CAGR over the next five years. BESS projects typically have a setup timeline of 15-18 months, with an EPC cost ranging from INR2.5-3 crores per megawatt hour. Bondada is actively exploring backward integration for BESS components to enhance cost efficiency and reduce import dependence, with further details expected in upcoming quarters.

Revenue Mix and Future Outlook

Currently, renewable energy contributes approximately 80% of the company's revenue, with telecom and products each accounting for about 10%. This mix is expected to continue for the next two to three years. New segments like Data Centers and Defence are projected to start contributing to revenue recognition from Q3 FY27. Management aims to double revenues by FY26 end and triple them by FY27 end, with potential margin expansion of 100 basis points due to economies of scale from larger project sizes.

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