Vascon Engineers

Vascon Engineers reported a consolidated total income of ₹254 crores in Q3 FY26, marking a 14.77% year-on-year decline from ₹298 crores in Q3 FY25. EBITDA for the quarter stood at ₹17 crores, down from ₹24 crores in the prior year. Profit after tax significantly decreased by 88.16% to ₹9 crores, though the previous year's figure included an exceptional gain^📎 of ₹75 crores from the sale of GMP. For the nine months ended December 31, 2025, consolidated total income grew by 3.87% to ₹725 crores, while PAT declined by 53.76% to ₹43 crores, also impacted by prior year's exceptional gain^📎s.

The EPC segment's revenue for Q3 FY26 was ₹248 crores, a moderation of approximately 9% year-on-year, primarily attributed to election-related delays in Bihar and project approval delays. Despite these short-term headwinds, the total order book as of December 31, 2025, stands strong at ₹2,825 crores, providing 2.8 times visibility over FY25 EPC revenue for the next two to three years. New EPC orders worth ₹646 crores were secured year-to-date, including a ₹220 crore order from Navi Mumbai Municipal Corporation in Q3 FY26. Approximately 77% of the order book is from government-backed projects.

No real estate revenue was recognized in Q3 FY26 as no projects were completed, contrasting with Q3 FY25 which included revenue from the GoodLife project. For the nine months ended December 31, 2025, new sales bookings totaled 77,315 square feet with a value of ₹86 crores, and collections were ₹105 crores. The company has a robust near-term pipeline of 1.94 million square feet, with an expected gross sales value of ₹2,360 crores, including projects like Powai, Prakash Housing Society redevelopment (construction expected Q1 FY27), and Tower of Future.

The company's real estate debt increased to ₹150-160 crores from ₹88 crores in FY24, mainly due to the cancellation of a QIP program (₹100 crores earmarked for real estate) and the need to fund FSI purchases and approval costs for new projects. Vascon has a strong working capital position with a total sanction limit of ₹745 crores, of which ₹370 crores remains unutilized and an additional ₹60 crores is under appraisal. Improved terms from SBI, including reduced collateral coverage from 35% to 27% and lower bank guarantee margins (from 25% to 15%), enhance liquidity. CRISIL reaffirmed an A-minus long-term credit rating.

Management acknowledged that the FY26 EPC revenue target of ₹1,200 crores will not be met due to project delays in Bihar, Chennai (Capgemini), and Sindhudurg, which collectively impacted revenue by over ₹100 crores. The market for EPC tenders remains highly competitive, with some bids going as low as -30% to -25%. The company now expects FY26 EPC revenue to be at similar levels to last year or slightly better, but aims to achieve ₹1,350-1,400 crores in FY27. The Orchids redevelopment project in Mumbai is experiencing slower sales velocity, with only 13% sold after two quarters.

Vascon is focusing on improving EPC execution efficiency, expanding its project pipeline, and actively pursuing new order inflows to strengthen its order book, targeting ₹3,000+ crores by April 2027. In real estate, the focus is on optimizing debt, timely completion of ongoing projects, and preparing for upcoming launches. The company aims to increase its private sector client exposure from the current 20% to 40% of its order book, leveraging its integrated design and execution capabilities. The Adani tie-up is viewed as a long-term partnership, with no revenue expected in the next two quarters.