Transrail Light

Transrail Lighting Limited reported strong financial results for Q3 and 9M FY26. Q3 revenue from operations grew 32% year-on-year to ₹1,796 crores, with EBITDA increasing 27% to ₹228 crores, maintaining a 12.7% margin. For the nine-month period, revenue surged by 49% to ₹5,017 crores, and EBITDA grew 40% to ₹614 crores, with margins at 12.2%. Operating PAT for 9M FY26 saw a significant 62% year-on-year growth to ₹324 crores, reflecting stable operating performance and cost discipline.

The company secured new orders worth ₹1,396 crores in Q3 FY26, bringing cumulative order inflows for the nine-month period to ₹5,135 crores. Including L1 bids of ₹3,483 crores, the effective order book stands at ₹18,216 crores as of December 31, 2025, providing strong revenue visibility. Management expects FY26 order intake to reach ₹9,500-10,000 crores and anticipates a 10-14% order intake from a ₹1 lakh crore tendering opportunity in FY27, with 57% domestic and 43% international composition.

Transrail demonstrated strong balance sheet management, with net debt reducing to ₹463 crores as of December 31, 2025, down from ₹703 crores in H1 FY26. This resulted in an improved debt-equity ratio of 0.39x and a net debt-to-EBITDA ratio of 0.57x. Cash equivalents significantly increased by ₹293 crores over H1 to ₹380 crores, supported by improved cash flows and better working capital management, with working capital days improving from 91 days in FY25 to 83 days in 9M FY26.

The company's CAPEX initiatives are on track to double capacity for towers and conductors, funded by internal accruals and IPO proceeds. 70% of the brownfield expansion (Phase 1) has commenced production and is expected to be fully operational by February end, with a new tower factory planned for commissioning by March/April 2026. Additionally, Transrail is upgrading its ERP systems from SAP HANA to SAP RISE to enhance cost discipline, compliance, and real-time decision-making, reinforcing its progressive digitization strategy.

Transrail maintains a healthy geographic mix, with 57% domestic and 43% international contribution to its order book, and 90% of its core business remaining in T&D. The company has successfully entered new geographies, including the GCC region for EPC works, and sees a strong outlook for the transmission and distribution sector, driven by sustained urbanization, renewable energy integration, and grid modernization, with a ₹1 lakh crore addressable market visibility for the next 12 months.

While the company upgraded its FY26 revenue growth guidance from 24-25% to 26-27% plus, management noted some conservatism due to ongoing ROW and forest clearance issues in domestic projects and certain international project delays. However, they expressed confidence in resolving these issues and potentially exceeding the revised guidance, aiming for 20-25% growth in the coming years, while maintaining an EBITDA margin profile of 11.5-12%.