Engineers India Limited — Q1 FY26 earnings call

Call held 18 Aug 2025

Management summary

Engineers India delivered a strong start to FY26 with record-high order book levels and 40% revenue growth. While the quarter saw a temporary loss from the RFCL joint venture due to a planned shutdown, the core consultancy and turnkey segments showed robust execution. Management maintained a conservative growth guidance of 15-20%, despite analyst pressure regarding higher historical execution rates and more optimistic public statements from the MD.

Highlights

  • Order book reached an all-time high of ₹12,145 crores as of June 30, 2025.

  • Revenue for Q1 FY26 stood at ₹857 crores, a significant 40% YoY increase.

  • Order inflow for the quarter was ₹1,430 crores, with ₹609 crores from Consultancy and ₹821 crores from Turnkey.

  • Profit After Tax (PAT) grew by 27% YoY to ₹70 crores.

  • EBITDA margin improved to 12% compared to 14% in the previous year's quarter (based on ₹85cr on ₹611cr vs ₹105cr on ₹857cr).

  • Consultancy segment EBIT margin stood at 17% for the quarter, with a normalized target of 22%.

  • International order intake reached ₹950 crores till the date of the call, primarily from the Middle East.

  • Management declared a dividend of ₹4 per share (80% on face value of ₹5).

Key financials

  1. Revenue ₹857 Cr +40%YoY
  2. EBITDA ₹105 Cr +23.5%YoY
  3. EBITDA Margin 12%
  4. PAT ₹70 Cr +27%YoY
  5. Order Book ₹12,145 Cr +3.6%QoQ
  6. EPS ₹1.25 +28.8%YoY

What they filed

Q1 FY27: revenue down 5.7%, net profit up 143.1% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue689 765 1,010 870 921 +34%1,210 +58%926 −8%820 −6%
EBITDA62 98 301 72 120 +94%352 +259%152 −50%126 +75%
Net profit100 109 280 65 83 −17%347 +218%196 −30%158 +143%
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

Share of Revenue
₹857 Cr Total
  • Turnkey Projects (LSTK) ₹449 Cr 52.4%
  • Consultancy and Engineering ₹408 Cr 47.6%

Guidance & targets

Revenue

  • Overall Top-line Growth Revenue · FY26 · Medium confidence 15-20%
    On the conservative side, we are 15% to 20% on the normal growth path.

    — Sanjay Jindal, Director-Finance

  • Consultancy Top-line Growth Revenue · FY26 · Medium confidence 12-15%
    For the consultancy business, it will be in the range of 12% to 15%.

    — Management

  • Total Turnover Target Revenue · by 2028 · Medium confidence ₹5,000 crores
    We should, I think by 2028, we should be able to achieve it because as soon as the order book increases, we are moving towards the same aim.

    — Management

Margin

  • Consultancy Segment Margin Margin · FY26 · High confidence 20-25%
    Going forward, the margins, basically segment margins, shall be in the range of around between 20% to 25%.

    — Management

  • LSTK Business Margin Margin · FY26 · High confidence 6-7%
    So, for the LSTK business, it is 5% to 6%, 6% to 7%. In the range of 6 to 7%.

    — Management

Risks & concerns

  • Execution Pace of New Orders

    medium

    Management noted that new orders typically only contribute 10-15% to turnover in their first year.

    Management acknowledged

  • JV Volatility

    medium

    Planned shutdowns in JVs like RFCL can materially impact quarterly consolidated earnings.

    Both acknowledged

  • CMD Transition

    low

    The current CMD is set to retire in February 2025; management declined to comment on extension possibilities.

    Analyst deflected

Areas of evasion (3)

  • Specific details on HPCL projects
  • CMD extension/succession planning
  • Reconciling MD's public growth targets with call guidance

Q&A highlights

2 direct
Discrepancy in Growth Guidance Partial
On the conservative side, we are 15% to 20%... In case our change orders are approved by the client, then definitely our growth will be 30% to 35%.

Analysts challenged the 15-20% guidance as too conservative compared to the MD's public statements of 30-35% and historical execution rates.

Asked by Amit Anwani, PL Capital

Joint Venture Losses (RFCL) Direct
RFCL project was under shutdown for the normal shutdown... it was shut down almost 45 days out of 90 days. And now this project is doing well... working at more than 90% capacity.

Explains the drag on consolidated profits and confirms the recovery of the JV's operations.

Asked by Mohit Kumar, ICICI Securities

Entry into Small Modular Reactors (SMR) Direct
This work is already awarded to us... somewhere around Rs. 30 crores. This will open opportunity for the other kind of assignments because Government of India is planning for a lot of this kind of SMRs.

Highlights a new, high-tech growth vertical in the nuclear energy space with significant long-term potential.

Asked by Saket Kapoor, Kapoor & Company

2 min read 5 chapters

Detailed narrative

Record Order Book Provides Strong Visibility

Engineers India's order book reached an unprecedented ₹12,145 crores as of June 30, 2025, up from ₹11,717 crores in March. Management further disclosed that they have secured an additional ₹2,700 crores in orders since the quarter ended, bringing the current visibility even higher. This record-high position is driven by both domestic infrastructure projects and a strong push into international markets, particularly Abu Dhabi and Kuwait.

Strategic Diversification into Non-Oil & Gas

The company is successfully diversifying its portfolio, with non-oil and gas projects now making up approximately 35-45% of the order book. Key wins include infrastructure assignments for IITs, IIMs, data centers, and specialized projects like the Ram Janmabhoomi campus modification. Margins in this segment remain healthy, with consultancy work yielding 20-22% and LSTK work around 5-6%.

Nuclear Energy: A New Frontier with SMRs

A significant strategic highlight is EIL's entry into the Bharat Small Modular Reactor (BSMR) space. The company was awarded a ₹30 crore conceptual design and engineering assignment by NPCIL. Management views this as a 'starting point' that could lead to a massive pipeline of assignments as the Government of India plans to deploy SMRs across the country to increase nuclear energy reach.

The Growth Guidance Debate

A central point of contention during the call was the revenue growth guidance for FY26. While the Director of Finance insisted on a 'conservative' 15-20% growth path, analysts pointed out that the MD had publicly alluded to 30-35% growth. Management clarified that the 15-20% figure is the baseline, but if pending change orders are approved by clients, the growth could indeed accelerate to the 30-35% range.

JV Recovery and Cash Position

The Q1 consolidated profit was impacted by a loss in the RFCL joint venture due to a 45-day planned shutdown. However, management confirmed the plant is now operating at over 90% capacity and expects the JV to be profitable for the remainder of the year, contributing ~₹100 crores to consolidated accounts. The company maintains a robust cash balance of approximately ₹1,100 crores, supporting its high dividend payout policy.

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