Detailed Narrative
Q1 FY27 Performance Overview
Power Mech Projects Limited commenced FY27 with continued growth, reporting a total revenue of INR 1,632 crores, a 26% increase year-on-year. This growth was primarily fueled by strong execution across core verticals, including civil infrastructure, industrial EPC, O&M, and international projects. Profit after tax (after minority interest) saw a significant 53% surge to INR 80 crores, translating to an EPS of INR 25.23, up from INR 16.61 in Q1 FY26.
Margin Dynamics and Challenges
Despite robust revenue growth, the company's EBITDA margin for Q1 FY27 stood at 10.8%, a 3 percentage point decline year-on-year. This compression was attributed to several factors: higher material and execution costs stemming from the Middle East conflict, increased royalty costs in the KRBM project, and elevated overburden removal expenses in the KBP mining business due to opening new seams. Management expects these costs to normalize in subsequent quarters, aiming to maintain a full-year EBITDA margin of 12.5%.
Order Book and Pipeline Strength
The company secured new orders worth INR 1,864 crores in Q1 FY27, contributing to a total order backlog of approximately INR 55,398 crores (including MDO projects). The executable order book, excluding MDOs, stands at INR 16,229 crores, providing strong multi-year revenue visibility. The order pipeline remains robust, with identified opportunities of INR 20,500 crores in the power sector and INR 8,500 crores in infrastructure, from which the company targets an annual order inflow of INR 12,000 crores.
Mining Operations Update
The mining business demonstrated strong growth, with revenue increasing by 223% year-on-year to INR 84 crores. Production from the KBP mine, which started in November 2025, is targeted to reach 3 million tons in FY27, with an EBITDA margin of 15-16%. The company anticipates the commissioning of the Tasra washery by November-December, which will significantly ramp up MDO revenue to INR 500 crores in FY27 and further to INR 1,100-1,200 crores in FY28, with MDO EBITDA margins expected to reach 20-21% at peak capacity.
O&M Business Outlook
The O&M segment continued its steady growth, contributing INR 431 crores, an 8% increase year-on-year, and now accounts for 30-35% of the overall business. The order backlog for O&M has grown by 11.8% to INR 3,322 crores. Management projects O&M revenue to reach INR 2,089 crores in FY27, targeting 20% growth, and expects to maintain an EBITDA margin of around 18% in this segment, driven by new capacity additions and increasing outsourcing trends from both private and public sectors.
Power Sector and Infrastructure Opportunities
The power sector remains a key focus, with significant opportunities arising from planned capacity additions of 63 gigawatts by 2032 and 91 gigawatts by 2036. The company is actively tracking major projects from BHEL, Adani, and JSW, with an estimated INR 25,000-30,000 crores in immediate opportunities. Power sector construction and EPC are expected to grow by 20-22%, contributing to an overall power sector growth of 14-15%. Additionally, the company is pursuing opportunities in the steel sector, new railway lines, and other infrastructure projects.