Detailed Narrative
Strong Q3 Performance and Operational Momentum
T R I L reported a robust Q3 FY26, with standalone revenues reaching INR704.21 crores and consolidated revenues at INR737 crores, marking a significant sequential growth of 64.53% and 60.22% respectively over Q2 FY26. Standalone EBITDA stood at INR114 crores with a margin of 16.19%, driven by improved execution, enhanced capacity utilization, and tighter cost controls. This performance indicates a clear inflection point in the company's operational momentum, positioning it well to achieve stated revenue and profitability objectives for the year.
Strategic HVDC Order and Long-term Growth Drivers
A key highlight of the quarter was securing an exceptional HVDC repair order from PowerGrid, making TARIL the first Indian company to receive such an order. This achievement reinforces the company's technological capabilities in high-voltage and advanced transformer segments and opens new long-term opportunities in the HVDC ecosystem. Management outlined a long-term revenue target of $1 billion or INR8,000 crores by FY28-29, to be driven by both organic transformer business growth and contributions from backward integration facilities.
Backward Integration and Capacity Expansion Initiatives
The company is actively pursuing six backward integration facilities, with the CTC plant targeted for commissioning in FY26-27, Press Board facility in Q3 FY27, RIP bushing plant in Q4 FY27, and the first phase of fabrication facility in the same period. Concurrently, core manufacturing capacity is being expanded, with Changodar facility completion expected in Q1 FY27 (adding 15,000 MVA) and Moraiya in Q2 FY27 (adding 22,000 MVA). These expansions aim for an overall capacity of 75,000 MVA and 85% utilization by next year-end, enhancing in-house value addition and cost efficiency.
FY26 Guidance and Financial Discipline
T R I L reiterated its FY26 guidance, targeting approximately INR2,600 crores in revenue, representing at least 25% growth over FY25, and an EBITDA margin of 16-17%. The company aims to be net debt-free within the next 18 months and improve working capital days to near 120 by year-end. This financial discipline is supported by current cash flow positive operations, with around INR30-35 crores positive cash flow and INR275 crores in cash deposits with bankers.
Deliberate Order Book Management and Pipeline
Management disclosed a deliberate strategy to moderate fresh order intake in H1 FY26 and limit the order book to an 18-month execution timeline, citing past issues with longer timelines. Despite a decline in the order pipeline from ₹22,000 crores in Q4 FY25 to ₹16,500 crores, the company is confident of achieving an INR8,000 crores order book by FY26 year-end. This confidence is underpinned by a robust pipeline of INR16,000 crores in tenders nearing finalization and the historical trend of Q4 being the strongest for PSU orders.
Margin Sustainability and Long-term Industry Outlook
The company expects margins to remain stable at 15-16% in the short term, with potential for a 200 basis points improvement from operational efficiency and leverage. Long-term gross margins are targeted to reach 35% by FY28 and potentially 40% with further backward integration. Management expressed confidence in sustained demand for the next 7-8 years, driven by India's power sector growth (15% industry growth), EV demand, replacement market, and emerging green hydrogen applications, despite increasing industry capacity.