Detailed Narrative
Strong Q3 FY26 Financial Performance
Prostarm Info Systems Limited reported a robust Q3 FY26, with operating revenue surging by 110% year-on-year and 141% sequentially to ₹161 crores. This strong growth was primarily driven by the execution of large-scale orders. EBITDA for the quarter stood at approximately ₹20 crores, reflecting an 81% year-on-year growth, with an EBITDA margin of 12.65%. Profit After Tax (PAT) also saw significant growth of 101% year-on-year, reaching approximately ₹15 crores, with a PAT margin of 9.28%.
Robust Order Book and Pipeline Visibility
The company's order book as of December 31, 2025, stood at ₹946 crores across 91 projects, providing healthy revenue visibility for the coming quarters. Approximately 20% of this order book is expected to be executed in the current financial year, with the remainder extending into FY27 and beyond. Additionally, bids under evaluation and tender plans aggregate to ₹775.4 crores, indicating a strong pipeline and supporting the medium-term growth outlook. The BESS segment alone accounts for over ₹890 crores of the current order book.
Strategic Capacity Expansion Initiatives
Prostarm is significantly strengthening its manufacturing footprint with two new facilities. A 1.2 gigawatt BESS manufacturing facility in Jhajjar, Haryana, is nearing commissioning and is expected to be operational in Q4 FY26, with a direct CAPEX of ₹25 crores. Concurrently, an expansion in Bakrol, Ahmedabad, for UPS systems manufacturing (1KV to 600KVA) is underway, expected to be operational by Q1 next financial year with a CAPEX of ₹6 crores. These expansions are crucial for catering to increased demand for advanced energy solutions and reducing dependence on imports.
BESS Segment Strategy and Outlook
The company is strategically focusing on the BESS segment as an OEM or EPC player, targeting a minimum conservative EBITDA margin of 14-15% for this segment. At full utilization, the Jhajjar BESS plant has a revenue potential of ₹1000-1200 crores, with 40-50% capacity utilization expected in the next financial year. While lithium cell sourcing faces 'price challenges' due to geopolitical issues, management asserts it's not a shortage and the upcoming 'Make in India' policy (50% domestic content for tenders from April 1st) is expected to stabilize margins for Indian players.
Working Capital Management and Debt Reduction
The company has materially strengthened its balance sheet, reducing long-term debt from ₹3.4 crore in March 2025 to ₹1.5 crore by nine months FY26, making it effectively net debt-free. This enhances financial flexibility for expansion initiatives. However, the working capital cycle is currently around 150+ days, and average receivable days are roughly 190 days, primarily due to the significant revenue booking in December. Management expects the working capital cycle to normalize as the year progresses.
Diversified Business Model and Technology Focus
Prostarm operates with a diversified customer base across government, public sector, utilities, and industrial enterprises. The company is implementing SAP B1 and Salesforce systems to enhance internal controls, operational efficiency, and customer relationship management. The Pune facility will focus on customized power solutions and BESS components, while the new Ahmedabad unit will specialize in regular UPS manufacturing, ensuring a clear strategic focus for each facility and leveraging technology for improved service and traceability.