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    DHRUV

    DHRUV
    Services·2 Mar 2026
    Management Summary

    Dhruv Consultancy Services Limited reported a 9-month FY26 revenue of INR35.36 crores, impacted by a non-cash accounting adjustment of INR30 crores related to revised project cost and margin estimates. Despite this, the company achieved a significant milestone by entering the aviation sector and secured new mandates, maintaining a robust unexecuted order book of INR256 crores. Management emphasized strengthened governance and a conservative approach to revenue recognition going forward, with expectations of improved operational cash flows and no further accounting adjustments.

    Highlights

    5

    • Achieved a significant milestone by entering the aviation sector in Q3 FY26 with a project for link taxiways at MIHAN Nagpur.

    • Secured new orders including four DPR projects from NHAI and multiple supervision contracts, reflecting strong order momentum and geographical diversification.

    • Unexecuted order book of INR256 crores provides healthy revenue visibility for coming quarters, with potential to reach INR300 crores next quarter.

    • Management committed to no further accounting adjustments in the future, having strengthened internal control systems and adopting a conservative approach.

    • Company is well-positioned to benefit from government focus on infrastructure development, with a 20-25% strike rate on Indian projects.

    Concerns

    4

    • 9-month FY26 revenue and profitability dipped due to a prospective non-cash accounting adjustment of approximately INR30 crores.

    • Analyst noted a credit rating downgrade, which management attributed to a limited review based on publicly available information and requested reconsideration.

    • Operational cash flows have been historically negative, attributed to industry nature and competition, though management expects significant improvement this year.

    • Corporate governance concerns were raised by an analyst regarding past issues and the recent accounting adjustments.

    Key financials

    Single quarter

    05 metrics
    1. 019-month FY26 Revenue₹35.36 Cr
    2. 02Accounting Adjustment Impact₹30 Cr
    3. 03Unexecuted Order Book₹256 Cr
    4. 04Total Order Book (Post-Adjustment)₹465 Cr
    5. 05Total Order Book (Pre-Adjustment)₹490 Cr

    Capital allocation

    2
    high confidence
    CategoryHeadline
    Debt

    Debt disclosed

    Liquidity

    Cash ₹70 crores

    Guidance & targets

    6
    CategoryTargetPriority
    Sectoral Diversification
    Aviation segment revenue contribution
    10-20%
    		Medium
    Order Book Execution
    Unexecuted order book realization timeline
    2.5-3 years
    		High
    Order Book Growth
    Total order book target
    INR1,000 crores
    		Medium
    Order Book Growth
    Unexecuted order book amount
    INR300 crores
    		Medium
    Order Acquisition
    Strike rate on Indian projects
    20-25%
    		High
    Accounting Practices
    Future accounting adjustments
    No such adjustments
    		High

    Detailed Q4 financials, especially 'other assets' breakdown.

    Next quarter (Q4 FY26 results).
    CurrentINR63 crores (other assets as of September), INR100 crores (net worth components).
    TargetComprehensive breakdown and clarity on components.

    Why it matters

    Essential for investor understanding of balance sheet composition and liquidity, as requested by multiple analysts.

    Yes, so Q4 it will be there because we get a very short time to review this... But Q4 we will be giving a detailed schedule

    How to verify

    key_financials.metrics[label='Other Assets']

    Risks & concerns

    5
    RiskSeverity

    Non-cash accounting adjustment impacting reported revenue and profitability.

    A prospective accounting adjustment of INR30 crores led to a dip in 9-month FY26 revenue and profitability, explained as a one-time refinement of estimates under Ind AS 8. — Management acknowledged

    high

    Credit rating downgrade.

    Analyst noted a credit rating downgrade, which management attributed to a limited review based on 9-month results and requested reconsideration in Q4. — Analyst downplayed

    medium

    Historically negative operational cash flows.

    Analyst pointed out consistently negative operational cash flows, which management explained as partly due to industry nature and competition, with a forecast for improvement this year. — Analyst acknowledged

    medium

    Geopolitical instability affecting international projects.

    Slowdowns in Africa and Middle East due to 'war situation and everything' and 'instability' in 2025, though no orders were cancelled. — Management acknowledged

    medium

    Corporate governance perception due to past issues and recent accounting changes.

    Analyst raised concerns about corporate governance given past debarment issues and the recent accounting adjustment, prompting management to detail corrective actions and commitment to strengthening governance. — Analyst acknowledged

    high

    Q&A highlights

    8

    “So as said in the opening remarks also that this reported loss is primarily due to change in accounting estimates. So we follow an Ind AS accounting standard and as per the Ind AS 8, any change in estimate that is done has to be debited to the P&L.”

    This was the primary driver of the reported dip in profitability and a major point of concern for analysts, requiring detailed clarification from management.

    asked by Saket Kapoor

    2 min read6 chapters

    Detailed Narrative

    01

    Q3 FY26 Financial Performance and Accounting Adjustment

    Dhruv Consultancy reported a 9-month FY26 revenue of INR35.36 crores. This figure, along with profitability, was impacted by a prospective non-cash accounting adjustment of approximately INR30 crores. Management clarified this adjustment was a one-time📎 refinement of project cost and margin estimates, undertaken in accordance with Ind AS 8 and Ind AS 115, and does not involve cash outflow or impact operational cash flows. The underlying project-level profitability remains positive, and the company's order book and operational cash flow remain stable.

    02

    Strategic Diversification and New Market Entries

    In Q3 FY26, Dhruv Consultancy achieved a significant milestone by entering the aviation sector, securing its first project for link taxiways at MIHAN Nagpur in October 2025. This move aligns with the company's Vision 2030 to diversify into other infrastructure sectors like railways, metros, and urban infrastructure, aiming to be a top-five consultant in these areas. Management expects the aviation segment to contribute 10-20% to revenue, leveraging the government's focus on developing 250-300 new airports in Tier 2 and Tier 3 cities.

    03

    Robust Order Book and Project Pipeline

    The company maintains a strong unexecuted order book of INR256 crores as of December 31, 2025, providing healthy revenue visibility. While the total order book (executed and unexecuted) decreased from INR490 crores to INR465 crores due to the accounting adjustment, this impact was less than 10%. Dhruv has recently submitted bids for projects worth close to INR350 crores and expects a 20-25% strike rate on Indian projects, with the unexecuted order book potentially reaching INR300 crores next quarter.

    04

    Enhanced Bidding Strategy and Technical Capabilities

    Dhruv's competitive bidding strategy emphasizes technical capability over financial numbers, especially with recent NHAI changes that fix costs for higher-rated consultants. This has enabled the company to bag five new orders in two months at significantly higher rates (5-6 lakh/km for DPRs compared to earlier 2-3 lakh/km). The company is strengthening its technical capabilities through project expertise, handling complex projects like expressways, and adopting advanced technologies such as 3D and 4D modeling.

    05

    International Expansion and Geographic Diversification

    The company is actively pursuing international opportunities, currently working in Mozambique and Ghana, and exploring Southeast Asia and the Middle East, particularly Saudi Arabia. Management expects to enter the Middle East segment this year, driven by Vision 2030 and massive industrial city developments. While India is expected to remain the core business due to its scale, international diversification aims to mitigate risks and ensure stability across different political and economic scenarios.

    06

    Commitment to Improved Governance and Transparency

    Addressing analyst concerns regarding past issues and the recent accounting adjustment, management affirmed its commitment to strengthening corporate governance. They stated that the Q3 adjustment was a 'hard call' taken to ensure future transparency and that no further such adjustments are expected. Initiatives include strengthening internal control systems, hiring experienced finance personnel, and fostering leadership development, positioning the company to become a multinational entity with robust governance.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.