Welspun Enterprises Limited

Welspun Enterprises reported a consolidated revenue of INR845 crores for Q1 FY26, marking a 9% year-on-year decline. This was primarily attributed to the early onset of monsoon in May, which curtailed execution by approximately 10 days on road projects, and the back-ended nature of the FY26 revenue cycle. Despite the revenue dip, the company achieved an 8% year-on-year growth in EBITDA to INR208 crores, with margins expanding by 377 basis points to 23.8%, showcasing strong operational efficiency.

As of June 30, 2025, the consolidated order book stands at INR13,665 crores, including INR4,400 crores from O&M contracts, providing significant revenue visibility. The company is actively pursuing new projects worth INR12,000-13,000 crores expected to be bid out in the next 30-45 days. Management expressed high confidence in booking fresh orders in the range of INR10,000-11,000 crores for FY26, supported by a substantial pipeline from NHAI (INR3 lakh crores) and water projects in key states.

The water segment demonstrated strong performance, registering a robust 38% year-on-year growth to INR310 crores and contributing 37% to consolidated revenue. Welspun Enterprises is strategically expanding its presence in complex, high-value water infrastructure, including tunneling, wastewater treatment, and large-scale delivery systems. Key projects like the Dharavi wastewater treatment facility and Bhandup water treatment facility are progressing, with execution momentum expected to accelerate in Q3 and Q4 FY26.

The company successfully received the Provisional Completion Certificate (PCOD) for the Aunta-Simaria bridge project, which had an equity investment of INR160 crores and is expected to yield a 2x return upon monetization within the current fiscal year. The Mukarba Chowk-Panipat project, already sold to Actis, will result in a net cash flow of INR140 crores. The company maintains strong consolidated cash reserves of INR1,068 crores and a consolidated net debt of INR378 crores, providing flexibility for growth and potential value-accretive M&A opportunities.

Welspun Enterprises is committed to digitalization, having implemented S/4HANA and an in-house project management system called WEL-Darpan. The adoption of tools like 3D/4D/5D Building Information Modeling (BIM) and AI for e-governance aims to enhance operational efficiencies and control. These initiatives have already contributed to margin expansion in Q1 FY26 through better resource utilization and real-time data for decision-making.

For the oil and gas segment, the company has signed an agreement for Block C-37 and is actively engaged in evacuation discussions with ONGC and DGH for the Mumbai block (MB-OSN-2005/2), where commerciality was declared last quarter. These discussions are anticipated to conclude within the next 60-90 days, with management expecting to share more definitive information regarding monetization timelines in Q3 FY26.

Management reaffirmed its consolidated revenue guidance for FY26 at INR4,000-4,100 crores, representing approximately 15% growth over the FY25 base of INR3,550 crores. This guidance is based on a back-ended execution cycle, with an anticipated 40:60 revenue split between H1 and H2, and accelerated project execution expected in the latter half of the fiscal year, particularly in Q3 and Q4.