Future Enterprises Limited — Q2 FY26 earnings call

Call held 21 Nov 2025

Management summary

Felix Industries delivered a robust financial performance in Q2 FY26, with significant year-on-year growth in revenue, EBITDA, and PAT. The company reiterated its FY26 revenue guidance of ₹110-120 crores and provided an FY27 outlook of ₹180-200 crores, driven by existing projects and new ventures in plastic recycling and sustainable metal recovery. Management highlighted its specialized environmental engineering approach and balanced strategy between EPC and BOOT projects, which contribute to its strong margin profile.

Highlights

  • Consolidated revenue for Q2 FY26 stood at ₹17.38 crores, up 117% year-on-year.

  • EBITDA for Q2 FY26 rose sharply to ₹8.86 crores, a 591% increase.

  • PAT for Q2 FY26 reached ₹5.328 crores, up 1605%.

  • H1 FY26 consolidated revenue grew to ₹38.00 crores, with EBITDA at ₹14.638 crores and PAT at ₹8.896 crores.

  • Management is confident of achieving FY26 revenue target of ₹110-120 crores and expects FY27 revenue to be ₹180-200 crores.

Concerns

  • No specific total order book value was disclosed, making overall backlog visibility limited.

  • The exact revenue contribution from plastic recycling for FY26 is uncertain, with management stating 'maybe some Rs. 5-Rs. 7 crores' and 'not sure about it'.

  • Revenue generation from the metal recovery segment is not expected before FY27-28, indicating a longer gestation period for this new venture.

Key financials

2 periods

Q2 FY26

  • Consolidated Revenue
    ₹17.38 Cr
    YoY +117%
  • EBITDA
    ₹8.86 Cr
    YoY +591%
  • PAT
    ₹5.328 Cr
    YoY +1,605%

H1 FY26

  • Consolidated Revenue
    ₹38 Cr
  • EBITDA
    ₹14.638 Cr
  • PAT
    ₹8.896 Cr

What they filed

Q1 FY27: revenue up 36.9%, net profit up 54.8% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue8 8 13 21 17 +117%27 +242%37 +188%28 +37%
EBITDA1 4 4 6 8 +1326%7 +107%8 +108%9 +62%
Net profit0 5 4 4 5 +1619%5 +6%4 +14%6 +55%
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

medium confidence

Inflow this quarter

₹1.43 Cr

Execution

2-3 months contract for specific EPC order

Management confirmed that the company is already booked with orders and is in the stage of executing them, with orders being long-lasting. No specific total order book value was disclosed, but a recent EPC order of ₹1.43 crores for a steel company was highlighted.

Source: Q&A

Capital allocation

low confidence
  • Debt Debt disclosed
    So, we currently have a combination of equity and debt from banks. So, it is currently being managed in this fashion only. And going forward, maybe we still have capacity to raise that. So, in future also, if we need, we have good bank lines available and our conduct is good. So, maybe we will be able to manage it from bank finance. So, it is a combination of both equity, debt and internal accruals.

Guidance & targets

Revenue

  • FY26 Consolidated Revenue Revenue · FY26 · High confidence ₹110-120 crores
    we are confident that we will touch the Rs. 110-Rs. 120 crores mark by the end of this financial year.

    — Nishant Sharma

  • FY27 Consolidated Revenue Revenue · FY27 · Medium confidence ₹180-200 crores
    this is what our expectation is that we will touch FY '27 anywhere around Rs. 180-Rs. 200 crores.

    — Nishant Sharma

Margin

  • EBITDA Margin Margin · FY26 · High confidence 25%-30%
    our margins are in the range of like EBITDA, you can expect anywhere between 25%-30%

    — Nishant Sharma

  • PAT Margin Margin · FY26 · High confidence 17%-20%
    the PAT remains anywhere between 17%-20%.

    — Nishant Sharma

Business Mix

  • FY26 EPC Revenue Contribution Business Mix · FY26 · High confidence ₹60-70 crores
    EPC would be somewhere around what we can say, just give me a second, EPC would be somewhere around Rs. 60-Rs. 70 crores. That would be roughly the number this year.

    — Nishant Sharma

New Business Revenue

  • FY26 Plastic Recycling Revenue New Business Revenue · FY26 · Low confidence ₹5-7 crores
    Maybe some Rs. 5-Rs. 7 crores may come from plastic in this year, but I am not sure about it.

    — Nishant Sharma

New Business Margin

  • Plastic Recycling Margin New Business Margin · Ongoing · Medium confidence 5%-10%
    anywhere between 5%-10% would be the kind of margin that we can expect.

    — Nishant Sharma

What to watch in Q3 FY26

Oman Phase II Expansion Progress

Next year (FY27)
Current Deferred to next year, current facility showing month-on-month improvement.
Target Announcement of Phase II initiation or concrete plans.

Why it matters

Indicates the company's international expansion strategy and potential for future revenue growth from Oman.

Phase-II is something which we will take up not at this moment, maybe in the next year, because we are now growing the revenues for the Oman facility and that is showing improvement month-on-month.

Risks & concerns

  • Project delays due to clients

    medium

    Projects sometimes get delayed because of the client, which can impact the timeline for O&M revenue generation.

    Management acknowledged

  • Uncertainty in new business revenue contribution

    medium

    While plastic recycling revenue is expected, the exact amount for FY26 (Rs. 5-7 crores) is uncertain, and metal recovery revenue is not expected before FY27-28.

    Management acknowledged

  • Forward-looking statements uncertainty

    low

    Discussion may contain forward-looking statements subject to various risks, uncertainties, and other factors beyond management's control.

    Management acknowledged

Q&A highlights

8 direct
FY26 Revenue Guidance Confirmation Direct
we are confident that we will touch the Rs. 110-Rs. 120 crores mark by the end of this financial year.

Confirms the company's ability to meet its annual revenue target despite no new large orders reported this quarter.

Asked by Zohaib Rashid

Sustainability of Current Margins Direct
our margins are in the range of like EBITDA, you can expect anywhere between 25%-30% and the PAT remains anywhere between 17%-20%. ... this is going to continue for the current financial year as well.

Clarifies that the high margins seen this quarter are within their expected range and are sustainable for the current FY, though project-specific.

Asked by Zohaib Rashid

Oman Phase II Expansion Timeline Direct
Phase-II is something which we will take up not at this moment, maybe in the next year, because we are now growing the revenues for the Oman facility and that is showing improvement month-on-month.

Provides clarity on the deferral of the next phase of Oman expansion, linking it to current facility performance.

Asked by Zohaib Rashid

Margin Profile of EPC vs. O&M Contracts Direct
EPC is about 15%-20% again with a lot of dynamics. But yes, EPC attracts lower EBITDA and the O&M attracts the higher EBITDA.

Details the profitability differences between the two primary contract types, indicating O&M offers higher margins.

Asked by Pinkesh Jain

Rationale for Entering Plastic Recycling & Metal Recovery Direct
we have certain specialization and we have certain expertise as part of technology. So, we can take care of all hazardous waste into consideration to recover all our metals. And whatever metals we will make, we will be complying to 99.999% purity. ... we have developed some technology on that front and that is where we are planning to use that technology and generate these kind of pure metals like 99.9% grade copper and zinc.

Highlights the company's technological edge and specialization as the driver for entering these new, high-purity recovery segments.

Asked by Abhishek Agrawal

Financial Contribution from Plastic & Metal Recycling Direct
revenue generation from plastic will definitely happen in this financial year. ... anywhere between 5%-10% would be the kind of margin that we can expect. From the metal part of it, we don't see anything happening before even the plant setup and everything will go up to the end of next Financial Year or something prior to that.

Provides initial financial expectations and timelines for the new business segments, indicating plastic recycling will contribute sooner than metal recovery.

Asked by Hiral Nandu

Accounting for Forfeiture of Warrants Direct
That has been credited to, I think, the capital reserve, means it has been credited to capital reserve. ... It is not reflected in your P&L. It is an adjustment to the balance sheet.

Clarifies that the forfeiture of warrants is a balance sheet adjustment to capital reserve and not an income statement item, preventing misinterpretation of earnings.

Asked by Hiral Nandu

Aiwasun Product Description Direct
Rosoft and Aiwasun are both home-use technologies offered by Felix. Rosoft provides a complete process for delivering clean, safe, and potable water for household use. Aiwasun is a heat pump system that supplies hot or cold water based on the surrounding air temperature.

Provides details on a specific product offering, Aiwasun, which is a home-use heat pump system for water.

Asked by Zohaib Rashid

3 min read 6 chapters

Detailed narrative

Strong Q2 and H1 FY26 Financial Performance

Felix Industries reported robust financial results for Q2 FY26, with consolidated revenue from operations reaching ₹17.38 crores, marking a 117% year-on-year increase. EBITDA surged by 591% to ₹8.86 crores, and Profit After Tax (PAT) saw an impressive 1605% rise to ₹5.328 crores. For the first half of FY26, consolidated revenue grew to ₹38.00 crores, with EBITDA at ₹14.638 crores and PAT at ₹8.896 crores, reflecting strong demand and disciplined operational execution.

Diversified Environmental Engineering & Core Strengths

The company operates as a diversified multi-segment environmental engineering firm, specializing in advanced technologies for solid waste management, oil reclamation, and wastewater treatment. Felix Industries focuses on hydrocarbon recycling, transforming waste oil and oily sludge into high-quality lubricant base oil and fuels. Their expertise extends to effluent and wastewater management, providing solutions like effluent treatment plants and zero-liquid discharge systems, with operations spanning Gujarat and Oman across 34,260 square meters of production area and a workforce of nearly 485 employees.

Strategic Expansion into New Growth Areas: Plastic & Metal Recycling

Felix Industries is expanding into new areas such as plastic recycling and sustainable metal recovery, aiming to scale capacity into waste-to-energy. In plastic recycling, the company plans to acquire existing facilities and convert waste materials like milk pouches into virgin-quality plastic granules, with an expected margin of 5%-10%. For metal recovery, Felix leverages its specialized technology to recover 99.999% pure metals like copper and zinc from hazardous waste, a segment with very few competitors in the market. Revenue from plastic recycling is expected to contribute ₹5-7 crores in FY26, while metal recovery is anticipated to generate revenue from FY27-28.

Business Model: Balancing EPC and BOOT Projects for Profitability

Felix Industries employs various business models including EPC (Engineering, Procurement, and Construction), BOOT (Build, Own, Operate, Transfer), and O&M (Operations and Maintenance). While EPC projects typically have lower EBITDA margins (15%-20%), O&M contracts offer higher margins and long-term recurring revenue. For BOOT projects, the company invests capital, with clients contributing 20-30% of the investment, and expects a payback period of 3-4 years. The overall strategy is to achieve a Return on Capital Employed (ROCE) of 18%-20% across projects.

Operational Excellence and Project Pipeline

The company is executing multiple ongoing and upcoming projects across various sectors including chemical manufacturers, pharma SEZ clusters, dairy, and oil & gas. Key projects include a 3,500-KLD WIP plant at Pharma SEZ, a 1,000-KLD system for a dairy producer, and an upcoming 4,000-KLD multi-sectorial mixed-effluent ZLD plant CETP. A recent EPC order for a steel company is valued at ₹1.43 crores with a 2-3 month contract period. Management expects O&M revenues to grow significantly from April-May next year as current EPC projects transition.

Capital Allocation and Funding Strategy

Felix Industries manages its capital allocation through a combination of equity, debt from banks, and internal accruals. The company indicated that it has good bank lines available and sufficient capacity to raise further funds if needed. While no specific capex figures were provided for the quarter, management discussed the investment structure for BOOT projects, where client contribution and a 3-4 year payback period are typical. The forfeiture of warrants this quarter was credited to capital reserve and not recognized as income, reflecting a balance sheet adjustment.

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

More Utilities earnings calls