Supreme Power — Q3 FY26 earnings call

Call held 11 Feb 2026

Management summary

Supreme Power reported a robust Q3 FY26 with total income growing 14.83% YoY to INR 36.03 crores, and 9M FY26 income up 23.7% YoY to INR 111.38 crores. Net profit for Q3 FY26 increased 6.34% YoY to INR 3.38 crores, with 9M FY26 net profit up 23.66% YoY. The new manufacturing facility is 95% complete and expected to be operational in Q4 FY26, which will significantly boost capacity and execution. The company also highlighted improved working capital management and a strong order book visibility for the coming years, while addressing minor delays and margin fluctuations.

Highlights

  • Strong revenue growth in Q3 FY26 (14.83% YoY) and 9M FY26 (23.7% YoY).

  • Net profit growth of 6.34% YoY in Q3 FY26 and 23.66% YoY in 9M FY26.

  • New manufacturing facility is 95% complete and expected to be operational in Q4 FY26, enhancing capacity and operational flexibility.

  • Secured significant orders in Q3 FY26 totaling INR 28.82 crores, contributing to a robust order book.

  • Working capital cycle significantly improved from 210 days to 80-90 days, indicating better cash flow management.

Concerns

  • Q3 FY26 net profit growth (6.34%) was lower than revenue growth due to INR 4-5 crores of manufactured material awaiting customer payment/billing.

  • Slight dip in margins in Q3 FY26 due to copper price fluctuation, though expected to stabilize at 10-12% PAT.

  • Delay in new plant readiness (expected Q3, now Q4) due to pending environmental clearance and minor administrative work.

Key financials

2 periods

Q3 FY26

  • Total Income
    ₹36.03 Cr
    YoY +14.8%
  • EBITDA
    ₹5.28 Cr
  • Net Profit
    ₹3.38 Cr
    YoY +6.3%
  • EPS
    ₹1.35
    YoY +6.3%

9M FY26

  • Total Income
    ₹111.38 Cr
    YoY +23.7%
  • EBITDA
    ₹19.56 Cr
    YoY +12.7%
  • Net Profit
    ₹12.78 Cr
    YoY +23.7%
  • EPS
    ₹5.12
    YoY +23.7%

What they filed

Q1 FY27: revenue up 33.6%, net profit up 10.1% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue29 28 90 38 42 +44%38 +37%109 +21%51 +34%
EBITDA4 2 14 6 7 +63%4 +86%16 +14%8 +43%
Net profit4 3 11 4 5 +33%3 +7%11 +0%5 +10%
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

₹300 Cr

as of 2026-03-31 quantified

Inflow this quarter

₹28.82 Cr

Execution

Karnataka order: 8-9 months; TNPDCL/Danya order: 4 months

Composition

Mix 3 geographies
  • Karnataka 35%
  • Kerala 10%
  • Tamil Nadu 40%

Share of order book by geography· partial disclosure (85% of the book)

Pipeline

deal pipeline tcv

Order pipeline of INR 700-800 crores

Cancellations & deferrals

  • deferred: INR 4-5 crores of material was manufactured but not billed in Q3 due to customer payment delay, to be billed in Q4.
Strong demand in the transformer sector, with a robust order book and pipeline, and efforts towards geographical diversification.

Source: Prepared remarks · Q&A

Capital allocation

high confidence
  • Capex Capex disclosed
    • New manufacturing facility investment ₹97.5 Cr
    No, it is a new plant, whereas the existing plant is something around --17,000 square feet, whereas the new plant is like 140,000 square feet. So it's a huge investment and it's more than INR95 crores to INR 100 crores investment.
  • Debt Debt disclosed
    Yes. As of now, we are comfortable with the bank borrowings for working capital. And for the next – for next year for a revenue of INR300 crores, we need to increase our working capital limit. The limits we need to increase, and we approached the bank also for next year requirement.
  • Liquidity Liquidity disclosed Working capital cycle improved from 210 days to 80-90 days. Government payments received within 1-2 months, private customers given 60-75 days credit.
    Last two years, it was bad. But now last one year, we are getting payment from government on time within a month. Yes, private parties almost we used to get payment before dispatch. And for some selected customers, we are giving credits because they are placing repeat orders, so we are not able to get payment upfront before delivering. And the repeat customers, we have to give credit for 60 days and sometimes they take 75 days also. So we are somewhere we have to flexible on that. So on an average, the receivable cycle is between 80 to 90 days.

Guidance & targets

Revenue

  • Total Income Revenue · FY26 · Medium confidence INR 180-200 crores

    Previously INR 200 crores plus → INR 180-200 crores

    Yes, yes. We are still confident. We are – we will be – we believe that we will achieve the target of INR180 crores to INR200 crores.

    — Vee Rajmohan

  • Total Income Revenue · FY27 · High confidence More than INR 300 crores
    Outlook, we are expecting more than INR300 crores next year.

    — Vee Rajmohan

  • Total Income Revenue · FY28 · Medium confidence INR 400-500 crores
    Yes, yes. Possibility to go up to INR400 crores to INR500 crores.

    — Vee Rajmohan

  • New Plant Contribution Revenue · Q4 FY26 · Medium confidence INR 30-40 crores
    Yes, it will be contributing new plant will be contributing something around INR40 crores. Yes. INR30 crores to INR40 crores.

    — Vee Rajmohan

Profitability

  • PAT Margin Profitability · Ongoing · High confidence 10-12%
    So the margin will sustain between 10% to 12%.

    — Vee Rajmohan

Capacity

  • Total Revenue Capacity (Existing + New Plant) Capacity · Once fully utilized · High confidence INR 700 crores
    See the new plant, the capacity -- full capacity, I think it can fetch up to INR600 crores to INR650 crores in the new plant. And here, we can go up to INR100 crores to INR110 crores in the existing plant. Yes. So all put together, maximum INR700 crores, we can go.

    — Vee Rajmohan

What to watch in Q4 FY26

New Plant Commercial Operations

Next quarter (Q4 FY26)
Current 95% complete, trial production started, admin building 5% pending, environmental clearance in final stage.
Target Fully operational, first invoice from new plant.

Why it matters

Crucial for capacity expansion and achieving FY26/FY27 revenue targets.

We are pleased to share that the construction of our new facility is approximately 95% complete, and it is expected to become operational approximately during Q4 FY '26.

Risks & concerns

  • Delay in new plant becoming fully operational

    medium

    New plant was expected by Q3 FY26 but is now expected in Q4 FY26 due to 5% admin building work and final stage environmental clearance.

    Analyst acknowledged

  • Manpower shortage for scaling new plant operations

    medium

    The main challenge after the new plant is operational will be to increase the strength of skilled workers to fully utilize the capacity, which the company is actively addressing.

    Management acknowledged

  • Raw material (copper) price volatility impacting margins

    low

    Copper price fluctuation caused a slight dip in Q3 margins, but the company has a pass-through mechanism for the copper portion of the product, expecting margins to sustain 10-12%.

    Both acknowledged

  • Competitive pressure from new capacities impacting margins

    low

    Management does not foresee significant competitive pressure impacting their margins due to existing strong order book and market demand, expecting margins to be maintained at 10-12%.

    Analyst downplayed

Q&A highlights

7 direct
Reason for lower Q3 execution/billing despite material readiness. Direct
Yes. Because this is – actually, we have manufactured product, and we were waiting for the payment, so it was not billed. So that is the reason we are not able to bill that. Because of the customer side – they made a little delay on that. So we are not able to do that. So that INR4 crores, INR5 crores material was lying with us. That was the reason which we are not able to deliver – which was not able to invoice that.

Explains the Q3 revenue miss and indicates a deferral of revenue to Q4, suggesting Q3 performance was not due to operational issues.

Asked by Garvit Goyal

Delay in new plant becoming operational. Partial
Q3, correct. The factory building, the total factory building is fully ready. The admin building is only almost 95% is over. So 5% the interior work and the partition work is going on. It may take one month, but we have already taken – started taking trial production in the factory building. So factory building is fully equipped and all machineries are fully installed, and we started taking trial production.

Clarifies the status of the new plant (factory ready, admin building 95% done, trial production started) and explains the slight delay from Q3 to Q4 for full operational status.

Asked by Garvit Goyal

Ability to pass on copper price increases to customers. Direct
Yes. Actually, in our product, we are using 20% to 20% of copper in transformers. For that portion, the price maybe per kg copper, if you raise INR100, that INR100 will be passed on to the customer. Not the entire margin and everything. Only the – yes. Only the copper raise will be shared.

Addresses margin stability in the face of raw material volatility, indicating a pass-through mechanism for the copper component.

Asked by Garvit Goyal

Competition and potential margin pressure from new capacities. Direct
And as of now, there is no symptom about that. And as of now, we are holding INR300 crores orders on hand for next year execution – including next year execution. And I don't find any much pressure on margin. It can be maintained between 10% to 12%, even or odd percent more.

Reassures investors about margin stability despite increasing competition, citing strong order book and ability to maintain margins.

Asked by Garvit Goyal

Working capital management and need for further debt. Direct
Yes. As of now, we are comfortable with the bank borrowings for working capital. And for the next – for next year for a revenue of INR300 crores, we need to increase our working capital limit. The limits we need to increase, and we approached the bank also for next year requirement.

Indicates potential need for increased working capital limits to support future growth, but no equity dilution planned.

Asked by Majid Ahamed

Geographical diversification strategy. Direct
Yes, now Karnataka is booming, and we are securing more orders from Karnataka state – state of Karnataka through EPC contractors. So almost 30% from Karnataka we are expecting, 30% to 40% from Karnataka and 10% from Kerala and 40% from Tamil Nadu.

Highlights successful expansion into new geographies (Karnataka, Kerala) reducing reliance on Tamil Nadu.

Asked by Majid Ahamed

Constraints for future growth after new plant commissioning. Direct
Getting the manpower. That is a challenge.

Identifies skilled manpower as the primary constraint for scaling up operations post-new plant commissioning, rather than capacity or order book.

Asked by Ramaiy Kapoor

Environmental clearance for new plant. Direct
Yes. Statutory, all approvals are in place. Only thing this PCB claims, environmental claims we have to get. We have applied for it just a matter of a week, we will get it. It is in the final stage.

Clarifies that environmental clearance is the only remaining hurdle for the new plant, and it's in the final stages, not a major blocker.

Asked by Garvit Goyal

2 min read 6 chapters

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.

This is an AI-generated summary of a publicly available earnings call transcript.
View original transcript

More Capital Goods earnings calls