Detailed Narrative
Q3 FY26 Financial Performance Overview
Supreme Power reported a total income of INR 36.03 crores for Q3 FY26, marking a 14.83% year-on-year growth. EBITDA stood at INR 5.28 crores, while net profit increased by 6.34% year-on-year to INR 3.38 crores. For the nine months ending December 31, FY26, total income aggregated to INR 111.38 crores, a 23.7% year-on-year growth, with net profit rising 23.66% to INR 12.78 crores. The company noted that INR 4-5 crores of manufactured product was not billed in Q3 due to customer payment delays, which will be recognized in Q4.
New Manufacturing Facility Update
The company's new manufacturing facility is 95% complete and is expected to become operational in Q4 FY26. The factory building is fully ready with all machinery installed, and trial production has commenced. The remaining 5% work pertains to the administrative building, and final environmental clearance is in its last stages, expected within a week. This new facility, a significant investment of INR 95-100 crores, will enhance capacity, improve operational flexibility, and support timely execution of a growing order book.
Order Book and Market Demand
Supreme Power currently holds an order book of approximately INR 300 crores, with an additional pipeline of INR 700-800 crores. New orders secured in Q3 FY26 totaled INR 28.82 crores, including INR 24.63 crores from Karnataka-based EPC companies and INR 2.69 crores from TNPDCL. Management indicated strong market demand for transformers, expecting this trend to continue for the next 5-10 years. The company is also diversifying its geographical presence, with 30-40% of orders expected from Karnataka, 10% from Kerala, and 40% from Tamil Nadu.
Margin Outlook and Raw Material Management
The company aims to sustain PAT margins between 10% to 12%. While Q3 FY26 saw a slight dip in margins due to copper price fluctuations, management confirmed a pass-through mechanism for the copper component (which constitutes 20% of the product cost) to customers. They expressed confidence in maintaining margins despite increasing competition, citing a robust order book and stable copper prices.
Working Capital Management and Funding
Supreme Power has significantly improved its working capital cycle, reducing it from 210 days to an average of 80-90 days. Payments from government clients are now received within 1-2 months (within 60 days), while some private customers are extended credit for 60-75 days. To support the projected revenue growth to over INR 300 crores in FY27, the company plans to increase its working capital limits through bank borrowings, with no current plans for equity dilution.
Future Growth and Constraints
The company has provided revenue guidance of INR 180-200 crores for FY26, over INR 300 crores for FY27, and INR 400-500 crores for FY28. The new plant is expected to contribute INR 30-40 crores in Q4 FY26, and combined with the existing plant, the total revenue capacity could reach INR 700 crores. The primary challenge identified for scaling up operations and fully utilizing the new capacity is the availability and recruitment of skilled manpower, which the company is actively addressing.