Jash Engineering Limited — Q3 FY26 earnings call

Call held 20 Feb 2026

Management summary

Jash Engineering faced a challenging Q3 FY26 with marginal revenue growth and margin compression primarily due to US tariffs impacting exports. However, the company has seen a resolution to the tariff uncertainty and boasts a growing order book of Rs. 923 crores. Strategic initiatives like the new Pithampur plant, Westech acquisition, and upcoming Penstock UK acquisition, along with new product developments and Middle East expansion, are expected to drive future growth and profitability, with FY26 PAT margin projected at 9-10%.

Highlights

  • Expected PAT margin for FY26 in the range of 9-10%, considered significant despite challenges.

  • Order book grew to Rs. 923 crores as of February 1st, 2026, with Rs. 653 crores from outside India and Rs. 270 crores from India.

  • US tariff uncertainty is gone, with consignments clearing at 25% duty, and potential reduction to 18% after deal ratification.

  • New plant at SEZ Pithampur is ready for commercial production from April 2026, freeing up capacity for aggressive order taking.

  • Acquisition of Westech is completed, and Penstock UK acquisition is on the verge of closure, strengthening UK operations and bringing new product designs.

Concerns

  • Marginal revenue growth of 3% for the year (YTD FY26) due to US tariffs.

  • Significant reduction in gross profit margin, EBITDA, and PAT for the current period.

  • FY26 consolidated revenue forecast revised down to Rs. 775-800 crores from an initial Rs. 860 crores.

  • Rodney Hunt business from India to America affected by a drop of Rs. 25-30 crores due to tariffs.

  • Shivpad revenue and deliveries affected by manpower and quality issues, leading to setbacks.

Key financials

2 periods

Headline

  • US Exports (9 months)
    ₹35 Cr

YTD FY26

  • Revenue Growth
    3%
  • Gross Profit Margin
    —
  • EBITDA
    —
  • PAT
    —

What they filed

Q1 FY27: revenue up 17.5%, net profit up 198.5% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue140 181 300 128 158 +13%161 −11%291 −3%150 +17%
EBITDA25 41 59 -4 20 −17%17 −58%69 +17%8 +297%
Net profit16 35 36 -5 11 −32%13 −62%57 +58%5 +198%
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

high confidence

Total value

₹923 Cr

as of 2026-02-01 quantified

Composition

Mix 2 geographies
  • Outside India 70.7%
  • India 29.3%

Share of order book by geography

Pipeline

deal pipeline tcv

In January, booked more than $3.5 million orders in US, including two orders of $1 million plus.

Cancellations & deferrals

  • delayed: Export from India to US was stopped or delayed for number of months due to tariff uncertainty.
  • delayed: Setback on deliveries at Shivpad due to manpower and quality issues.
Order book is continuously growing and all divisions/subsidiaries have good order positions, with a strong outlook for America post-tariff resolution.

Source: Prepared remarks

Capital allocation

high confidence
  • Capex Capex disclosed
    • New plant at SEZ Pithampur for commercial production
    • Houston plant construction and commissioning
    I am pleased to announce that our new plant at SEZ Pithampur is ready. It will go on commercial production from the beginning of April.
  • M&A Westech Acquisition · Closed · Consideration ₹[object Object] (undisclosed)

    To strengthen presence in other geographical areas and bring more revenue.

    Westech order book is Rs. 45 crore, with Rs. 15 crore to be executed in remaining two months of FY26.

    The Westech acquisition is already done... So, we have almost spent Rs.30 crore in the Westech deal
  • M&A Penstock UK Acquisition · Pending regulatory · Consideration ₹[object Object] (undisclosed)

    To strengthen UK operations, bring new product designs, and diversify business.

    the Penstock UK acquisition is also on the verge of closure. If everything goes well, you should be able to do it within February, if not, then in March 26... how much expected in the Penstock UK. Rs.5-6 crores
  • M&A Middle East Company Joint venture · Announced

    To become stronger in other geographical areas, cater to local EPC contractors, and serve own local EPC contracts.

    Middle East is one of the fast-growing area, and in Middle East we have decided to set up a company. Already we have received permission for the company setting up, and we are now applying for land
  • M&A Rodney Hunt Mahr Industries (Saudi Arabia) Joint venture · Announced

    To benefit from localization, price preference, and spare capacity in India, tapping into the booming Saudi Arabian market.

    one is about setting Rodney Hunt Mahr Industries in Saudi Arabia. Saudi Arabian market is booming.

Guidance & targets

Profitability

  • PAT Margin Profitability · FY26 · High confidence 9-10%
    we expect this PAT to be in the range of 9-10% which I believe is significant

    — Pratik Patel, Chairman & Managing Director

  • PAT Margin Profitability · FY27 · Medium confidence 12-14%
    we will make around 20-24% operating margin and 12-14% PAT margin going forward next year. Yes, if everything works out, it should happen like that.

    — Pratik Patel, Chairman & Managing Director

  • Operating Margin Profitability · FY27 · Medium confidence 20-24%

    — Pratik Patel, Chairman & Managing Director

Revenue

  • Consolidated Revenue Revenue · FY26 · High confidence Rs.775-800 crore

    Previously Rs.860 crores → Rs.775-800 crore

    I expect anywhere between Rs.775-800 crore as our consolidated revenue for the year

    — Pratik Patel, Chairman & Managing Director

  • Inorganic Business Contribution Revenue · FY27 · Medium confidence Rs.50 crores

    Previously Rs.100 crores → Rs.50 crores

    I would say Rs.50 crores.

    — Pratik Patel, Chairman & Managing Director

  • Disc Filter Business Potential Revenue · Medium confidence Rs.20-25 crores
    We make small disc filters, and we expect domestic and export to together Rs.20-25 crores worth of business.

    — Pratik Patel, Chairman & Managing Director

  • Saudi Arabian Market Revenue (Initial) Revenue · First year · Medium confidence Rs.20-30 crores
    in the first year beginning, we don't expect more than Rs.20-25-30 crores.

    — Pratik Patel, Chairman & Managing Director

  • Saudi Arabian Market Revenue (Long Term) Revenue · Low confidence Rs.100 crore
    But slowly we are expecting Rs.100 crore revenue from that company.

    — Pratik Patel, Chairman & Managing Director

  • Consolidated Revenue Revenue · FY27 · High confidence Rs.950 crores plus
    So, we are quite confident of Rs.950 crores plus.

    — Pratik Patel, Chairman & Managing Director

What to watch in Q4 FY26

Penstock UK Acquisition Closure

February/March 2026
Current On the verge of closure
Target Closed

Why it matters

Completion of this acquisition is expected to strengthen UK operations and bring new product designs, contributing to future growth.

the Penstock UK acquisition is also on the verge of closure. If everything goes well, you should be able to do it within February, if not, then in March 26.

Risks & concerns

  • US Tariffs and Trade Uncertainty

    high

    US tariffs resulted in a slowdown of deliveries from India to the US and created uncertainty, significantly impacting revenue and margins. However, management states the uncertainty is now resolved.

    Management acknowledged

  • Manpower and Quality Issues at Shivpad

    high

    Shivpad experienced significant problems with manpower and quality, leading to customer complaints and setbacks in deliveries. Management is actively rebuilding the team to address this.

    Management acknowledged

  • Raw Material Price Volatility

    medium

    Fixed-price projects are vulnerable to raw material price volatility. Management mitigates this by forecasting and notes that rupee depreciation can partially offset increases.

    Analyst acknowledged

  • Houston Plant Contractor Bankruptcy

    medium

    The contractor for the Houston plant went bankrupt, causing delays in its construction and commissioning. The company is now searching for a new contractor.

    Management acknowledged

Q&A highlights

5 direct
Next year's projections and impact of current year's blip Direct
So basically, this year's blip will not affect what projection we are given for next year.

Analyst sought clarity on whether the current year's challenges would impact future growth projections, which management confirmed would not be the case.

Asked by Jiten Parmar

Benefits of UK deal (Penstock UK acquisition) for Waterfront Direct
the acquisition not only brings stability to Waterfront and penetration in the Midland market, but also brings new product design to us, which is like lego blocks very fast and needs very few people. And can help me roll out this product, and it is a very competitive product worldwide.

Management detailed the strategic advantages of the Penstock UK acquisition beyond just market presence, highlighting new product design capabilities.

Asked by Jiten Parmar

Raw material price volatility and fixed-price projects Partial
When we are bidding for the project, we are always forecasting what would be the pricing of the raw material, and accordingly we are taking it in our estimates. However, if a project is long gestation, say two years, and something happens in between, like covid happened, then it is very difficult for us to project that and cover for that.

Analyst probed on risk management for fixed-price projects amidst volatile raw material costs, revealing the company's forecasting approach and vulnerability to unforeseen long-term events.

Asked by Rushabh Shah

Shivpad performance and outlook Direct
So, we had lot of problem with the manpower. The quality was not coming out. Lot of customer complaints were there. So, we had to send a team from Indore, train a team in Indore and send the team in Indore... As a result of that, we have had some setback on deliveries, but quality is more important than revenue because once you lose the trust of clients, then you are in a deep problem.

Management provided a candid explanation for Shivpad's underperformance, attributing it to internal operational issues (manpower, quality) and outlining steps for recovery.

Asked by Sahil Doshi

Houston plant status and future investments Direct
So, Houston plant we had placed the order on a contractor. He has gone bankrupt and he has closed the company. So now we are searching for another contractor, and we would be able to get his pricing in this month and we will negotiate a new order with him next month and we expect to start in June, July, the construction and commission the plan next year, before September.

Management disclosed a significant setback with the Houston plant due to contractor bankruptcy, providing an updated timeline for its revival.

Asked by Dilip Sahu

Legal opinion on US tariff refund Partial
What I said at that point of time was not that, I said instead of 50% we got a legal opinion that we can go on reciprocal tariff, not iron steel tariff. Refund is not something I discussed it was the reciprocal tariff was 25% which was increased to 50% but iron and steel tariff was 50%.

Management clarified a previous statement, correcting the analyst's understanding that a refund was expected, instead explaining the legal opinion was about applying a lower reciprocal tariff.

Asked by Sahil Doshi

Naming of Saudi subsidiary (Rodney Hunt Mahr vs Jash) Direct
Just because, Jash in Saudi language is Jaish, same as Jaish-e-Mohammed. So, they do not allow me approval of that name. I was in Saudi Arabia for three days, I tried everything. Finally, I got these two names with possibility that tomorrow we will bring Jash also into this name.

Analyst inquired about the branding strategy for the Saudi JV, leading to a cultural and linguistic explanation for the chosen name and future branding aspirations.

Asked by Kunal

Total exports from India to US and applicable tariffs Partial
So, total Rs.35 crore order we have already dispatched and Rs.10-15 crore in last quarter. So 18% or 25% whatever would be on that. 25% as of today. Upto march it is 25%.

Analyst sought clarification on the volume of US exports and the current tariff rates, providing specific figures for dispatched orders and current/near-term tariff percentages.

Asked by Kunal

3 min read 6 chapters

Detailed narrative

Impact of US Tariffs and Revenue Revisions

Jash Engineering experienced a marginal revenue growth of 3% for the year, primarily due to US tariffs which caused a slowdown in deliveries from India to the US. This led to a significant reduction in gross profit margin, EBITDA, and PAT. Consequently, the consolidated revenue forecast for FY26 has been revised downwards to Rs. 775-800 crores from the initial projection of Rs. 860 crores. The Rodney Hunt business from India to America alone saw a drop of Rs. 25-30 crores due to these tariff-related issues.

Order Book and Geographic Diversification

Despite the challenges, the company's order book continues to grow, reaching Rs. 923 crores as of February 1st, 2026. Of this, Rs. 653 crores are from outside India and Rs. 270 crores from India. The US order book stands at $42 million. Management aims for future business mix to be around 40-45% from India, 35% from America, and the balance from other territories, emphasizing diversification to reduce reliance on any single geography.

Strategic Acquisitions and New Market Entry

The acquisition of Westech has been completed, contributing an order book of Rs. 45 crores, with Rs. 15 crores expected to be executed in the remaining two months of FY26. The acquisition of Penstock UK, costing Rs. 5-6 crores, is on the verge of closure, expected by February or March 2026, to strengthen UK operations and introduce new product designs. Furthermore, the company is setting up a new entity in the Middle East, having received permission and currently applying for land, to tap into the fast-growing market and cater to local EPC contractors.

New Product Development and Project Highlights

Jash Engineering is actively developing new products and undertaking special projects. This includes special gates for desalination plants, where they are considered a leading supplier, and the development of Surge Vessels (Bladder type) and Twin Screw Conveyors for Sludge Handling. The company also highlighted successful projects like the 40 MGD Rithala plant with a 37 kW Archimedean Screw Turbine for electricity generation and the Sewage Treatment Plant at Bandra, showcasing a wide range of products supplied for complex projects.

Operational Challenges and Resolutions

The Shivpad unit faced significant setbacks in deliveries due to manpower and quality issues, leading to customer complaints. Management is addressing this by rebuilding the team with trained personnel from Indore, prioritizing quality over immediate revenue. Additionally, the Houston plant project faced a delay as its contractor went bankrupt; the company is now seeking a new contractor and expects construction to start by June/July 2026, with commissioning before September 2027.

Future Outlook and Growth Drivers

With the resolution of US tariff uncertainty, the company expects to return to its projected growth path, targeting a PAT margin of 12-14% and an operating margin of 20-24% for FY27. Consolidated revenue for FY27 is projected to exceed Rs. 950 crores. New initiatives like the Pithampur SEZ plant, Westech and Penstock UK acquisitions, Middle East expansion, and new product developments are expected to be key growth drivers, with the disc filter business alone projected to contribute Rs. 20-25 crores.

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