Jinkushal Industries Limited — Q3 FY26 earnings call

Call held 13 Feb 2026

Management summary

Jinkushal Industries reported robust standalone growth in Q3 FY26, with 9M FY26 revenue up 24% YoY to ₹184.29 crores. However, the consolidated results showed a loss of ₹9.87 crores for the quarter, primarily due to strategic overseas inventory build-up (₹70 crores) and inter-company profit elimination. Management emphasized this is a timing issue, not a structural demand problem, and expects conversion of this inventory into revenue. The company is focused on expanding its HexL brand and global distribution network, targeting significant long-term growth.

Highlights

  • Standalone revenue grew 24% year-on-year to ₹184.29 crores for 9M FY26, reflecting sustained export demand.

  • Standalone profit after tax for Q3 FY26 was ₹4.17 crores, representing a healthy growth of approximately 34% YoY.

  • Strategic overseas inventory build-up to ₹70 crores aims to shorten delivery timelines and expand direct sales, strengthening distribution reach.

  • HexL brand, a key long-term growth vertical, increased its share from 1% to nearly 9% in 9M FY26 sales.

  • Management maintains aspiration for multiple-time revenue growth over the next 2-3 years.

Concerns

  • Consolidated group reported a loss after tax of ₹9.87 crores for Q3 FY26.

  • Consolidated profit after tax for 9M FY26 was only ₹1.08 crores, significantly lower than standalone.

  • Temporary purchase deferrals in Mexico due to tax-related clarifications impacted Q3 FY26 sales.

  • Consolidated results reflect a timing difference where costs are expensed but revenue/profit from overseas inventory is recognized only upon external sale.

Key financials

2 periods

Q3 FY26

  • Standalone Total Income
    ₹9,179 lakh
  • Standalone PAT
    ₹417 lakh
    YoY +34%
  • Consolidated Total Income
    ₹4,535 lakh
  • Consolidated Loss After Tax
    ₹-987 lakh

9M FY26

  • Standalone Total Income
    ₹18,429 lakh
    YoY +24%
  • Standalone PAT
    ₹1,148 lakh
  • Consolidated Total Income
    ₹17,094 lakh
  • Consolidated PAT
    ₹108 lakh

What they filed

Q1 FY27: revenue up 15.9%, net profit down 66.2% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue70 183 78 49 73 +4%44 −76%192 +146%57 +16%
EBITDA2 13 3 5 7 +259%-9 −166%13 +295%-1 −115%
Net profit2 12 1 7 4 +170%-10 −180%12 +1045%2 −66%
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

Execution

Business cycle of 120-150 days for procurement, refurbishment, and shipment.

Composition

Mix 3 products
  • New machines 49%
  • Old machines (refurbished) 42%
  • HexL brand 8.6%

Share of order book by product

Pipeline

other

Some orders and pipelines exist, but not formally maintained as a quantified order book.

Cancellations & deferrals

  • deferred: Temporary purchase deferrals by importers in Mexico due to tax-related clarifications.
Management views inventory build-up and dealer commitments as indicators of future revenue visibility, rather than a formal order book.

Source: Prepared remarks

Capital allocation

high confidence
  • Debt Debt disclosed
    our debt utilization as well has not been increased as per the increase in the revenue and that is only working in capital as well.
  • Liquidity Undrawn ₹120 Cr Strengthened liquidity position post-IPO, with ₹80-90 crores from IPO proceeds and a working capital base of around ₹300 crores.
    strengthened liquidity position of our IPO. By positioning inventory closer to end-customers... we have infused net worth of net-net around Rs. 80-Rs. 90 crores in the company, and apart from that, we have a sanction limits of Rs. 120 crores, right? So, net-net if you look at the large amount, we already have a working capital base of around Rs. 300 crores

Guidance & targets

Revenue

  • Revenue Growth Revenue · next 2-3 years · Medium confidence multiple-time growth
    Our aspiration to achieve a multiple-time growth on revenue over the next 2-3 years remains intact

    — Abhinav Jain

  • Total Revenue Revenue · 3 years · High confidence ₹800 crores
    And your other question about the long-term revenue growth, we are still intact on that... to achieve around Rs. 800 crores in 3 years.

    — Abhinav Jain

Profitability

  • PAT Margin (Refurbished Machines) Profitability · going forward · High confidence 14%
    14% level is what we expect and see estimated on PAT level for refurbished used machines.

    — Abhinav Jain

  • PAT Margin (HexL Brand) Profitability · going forward · High confidence 12%-14%
    going forward in the years to come, we expect 12%-14% on PAT level basis for our own brand as well, without any CAPEX.

    — Abhinav Jain

Brand Positioning

  • HexL Brand Ranking Brand Positioning · long run · Medium confidence top 10 brands
    We are trying to become one of the top 10 brands in the world for sure in the long run.

    — Sumeet Berlia

What to watch in Q4 FY26

Overseas Inventory Conversion to Revenue

next quarter/coming quarters
Current ₹70 crores overseas inventory, causing consolidated loss
Target Conversion into revenue and profitability

Why it matters

This is crucial for improving consolidated financial performance, as the current loss is attributed to this accounting timing difference.

We expect conversion into revenue and profitability in the normal course of business.

Risks & concerns

  • Temporary sales deferrals in Mexico due to tax clarifications

    medium

    Tax-related clarifications in Mexico led to temporary purchase deferrals by importers, impacting Q3 FY26 sales, but management views it as a timing issue, not structural.

    Management acknowledged

  • Consolidated loss due to inter-company profit elimination from overseas inventory

    medium

    Strategic overseas inventory build-up resulted in a consolidated loss for Q3 FY26 because costs are expensed, but profit is recognized only upon external sale, creating a timing difference.

    Management acknowledged

  • Long operating cycle impacting quarterly financial reflection

    low

    The business has a 120-150 day operating cycle, meaning a single quarter's results may not fully reflect the underlying performance or conversion of inventory to sales.

    Management acknowledged

Q&A highlights

6 direct, 1 evasive
Consolidated loss despite standalone growth and future revenue targets Direct
So, I would like to clarify that we have not seen a downward trend. In fact, we have seen an upward trend of 27% of standalone export turnover growth from about Rs. 140 crores to about Rs. 185 crores or something. And on a consolidated level, the inter-company profit elimination essentially removes your profit of the inventory which has been exported from India, however, has still had overseas inventory on a more consolidated level.

Clarifies the accounting impact of strategic overseas inventory on consolidated results versus underlying standalone performance and long-term targets.

Asked by Aniket Madhwani

Impact of Mexico's 50% tariff on Indian exports Direct
First of all, our product is not explicitly covered and it is still not clarified whether our product is covered or not... So, during the end of that period on 31st of December, basically, it was not exactly clarified whether our product will be covered or not because the tariff was actually being implemented from the New Year. So, as on the reporting date, the purchasers and importers deferred their purchases to the New Year.

Explains that the Q3 sales dip in Mexico was a temporary deferral due to policy uncertainty, not a structural demand issue, and their products may not be affected.

Asked by Aniket Madhwani

Business model, sourcing of used machinery, and HexL brand positioning Direct
We buy used machines all across India and the world. We refurbish them across either our own refurbishment center in Raipur in India or our partner refurbishment centers elsewhere in India or in our partner refurbishment vendors or contractors elsewhere around the world... Our brand is only HexL and that is our own brand, own design machine. We are competing with Caterpillar on that.

Provides a comprehensive overview of the company's asset-light business model, global sourcing, refurbishment network, and the strategic positioning of its HexL brand.

Asked by Madhur Rathi

Ability to match previous year's revenue of ₹380 crores for FY26 Partial
It will remain to be seen and we can comment on the coming quarter. But as I said, we are confident on building a business. For us, all the right tick boxes have been checked with record inventory build-up, the right direction, evaluating and assessing of building teams, senior leaderships from other OEMs etc., to drive growth, to make our business organized.

Management defers a direct answer on the specific revenue target but reiterates confidence in long-term growth drivers and strategic initiatives.

Asked by Madhur Rathi

Increase in current liabilities from ₹5.9 crores (FY25) to ₹26.1 crores (H1 FY26) Evasive
You are looking to H1 numbers. Let me check once.

Management did not provide an explanation for the significant increase in current liabilities, leaving an unanswered question about working capital management.

Asked by Madhur Rathi

Current order book and revenue visibility for the next 12-18 months Direct
there is no current order book as such. There are some orders and pipelines, but we don't maintain that as an order book like Rs. 200 crores of Government OEM co-ordering and all. But we have commitments from our dealers, especially in HexL... the inventory, I think you can get a decent idea of revenue visibility going forward.

Clarifies that the company does not maintain a formal order book like OEMs, relying instead on inventory build-up and dealer commitments as indicators of future revenue.

Asked by Jayesh

Impact of overseas inventory movement on consolidated profit Direct
Yes, you got it exactly right. Because what happens is, according to Ind AS, in very plain English, all the expenses are recorded for any movement, right... But the profit and turnover get eliminated. If there is inventory, obviously, it got built up and there is not the perfect cost inbuilt on it... So, this is called intergroup elimination or something like this.

Confirms that the consolidated loss is primarily an accounting effect of moving inventory to overseas subsidiaries before external sale, leading to cost recognition without immediate revenue recognition.

Asked by Hemant

Reasons for strong market presence and competitive advantage Direct
We are the largest exporter in India for non OEM construction equipment for a reason... our family has been users and even our extended family cousins, etc., all have been users of construction and mining machines. We have a very first-hand, internal overview of, not such an overview, very in-detail understanding about how machines work, what do the customers want... and that is how we have been able to have so much of customer insights and solve problems of customers that took up designing our own brand in HexL.

Highlights the company's unique competitive advantages stemming from its family's deep industry experience and customer-centric approach in product design and refurbishment.

Asked by Praneet

2 min read 6 chapters

Detailed narrative

Q3 FY26 Financial Performance Overview

Jinkushal Industries reported strong standalone performance for Q3 FY26, with total income reaching ₹91.79 crores and PAT growing 34% YoY to ₹4.17 crores. For the nine-month period, standalone total income increased 24% YoY to ₹184.29 crores. However, consolidated results showed a loss after tax of ₹9.87 crores for Q3 FY26 and a profit of ₹1.08 crores for 9M FY26, primarily due to accounting adjustments related to strategic overseas inventory.

Strategic Overseas Inventory Build-up and Accounting Impact

The company made a conscious decision to increase its overseas inventory to approximately ₹70 crores, the highest in its history, post-IPO. This strategy aims to shorten delivery timelines and expand direct sales. The consolidated loss is a result of inter-company profit elimination, where associated operating costs are expensed as incurred, but revenue and profit are recognized only when the inventory is sold to external customers, creating a timing difference.

Mexico Market Dynamics and Export Diversification

Sales in Mexico, historically a significant export market, experienced temporary deferrals in Q3 FY26 due to tax-related clarifications. Management clarified this was a timing-related development, not a structural demand issue, and expects demand to increase in Mexico. The company is also proactively strengthening its execution across other markets like UAE and South Africa to diversify and reduce concentration risks, with presence in over 35 countries.

Business Model and HexL Brand Development

Jinkushal operates an asset-light business model focused on exports of new, used, and refurbished construction and mining machinery. Their proprietary HexL brand, designed in the USA and manufactured in China, is a key long-term growth vertical. HexL's contribution to sales increased from 1% to 8.6% in 9M FY26, and the company aims for it to become one of the top 10 brands globally, targeting 12-14% PAT margins without significant CAPEX.

Working Capital Management and Liquidity

The company emphasizes prudent working capital management in its capital-intensive sector. Post-IPO, approximately ₹80-90 crores were infused, contributing to a working capital base of around ₹300 crores, alongside sanction limits of ₹120 crores. The long operating cycle of 120-150 days necessitates efficient working capital utilization to support growth and inventory build-up.

Future Outlook and Growth Strategy

Jinkushal Industries maintains its aspiration for multiple-time revenue growth over the next 2-3 years, targeting ₹800 crores in revenue within this timeframe. This growth will be driven by expanding overseas distribution, increasing refurbished exports, and scaling the HexL brand. The company's focus remains on disciplined expansion, improved revenue quality, and building a globally competitive export business, with a strong emphasis on profitability.

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