This article first appeared on GuruFocus .
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Consolidated Revenue:INR552 crores in Q3 FY26, a 4.3% year-on-year growth from INR529 crores in Q3 FY25.
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Gear Division Revenue:INR429 crores in Q3 FY26, reflecting a flat year-on-year performance.
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MHE Division Revenue:INR123 crores in Q3 FY26, a 16% year-on-year growth from INR105 crores in Q3 FY25.
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Consolidated EBITDA:INR109 crores in Q3 FY26, with an EBITDA margin of 19.8%.
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Gear Division EBITDA:INR78 crores in Q3 FY26, with an EBIT margin of 18.2%.
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MHE Division EBIT:INR25 crores in Q3 FY26.
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Profit After Tax:INR72 crores in Q3 FY26, representing a PAT margin of 13%.
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Order Intake:INR701 crores in Q3 FY26, a 7% year-on-year growth.
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Net Cash Balance:Approximately INR600 crores.
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CapEx Outlay:Estimated at INR400 crores for FY26 to 2028.
Release Date: January 09, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Elecon Engineering Co Ltd ( BOM:505700 ) reported a year-on-year revenue growth of 4.3% for Q3 FY26, with consolidated revenue from operations standing at INR552 crores.
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The Material Handling Equipment (MHE) division showed strong growth momentum, delivering a 16% year-on-year increase in revenue, driven by robust demand from sectors such as power, cement, mining, and ports.
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The company has a strong global presence, with operations in nearly 95 countries, providing a solid foundation for future growth.
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Elecon Engineering Co Ltd ( BOM:505700 ) maintains a robust financial position with a net cash balance of approximately INR600 crores, offering significant flexibility for growth opportunities and capital expenditure plans.
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The company has a healthy order book and a strong inquiry pipeline, providing clear visibility for growth in the coming quarters.
Negative Points
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The Gear division reported a largely flat performance with only a 1.3% year-on-year revenue growth, impacted by timing-related delays in order receipt and execution.
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Consolidated EBITDA for the quarter decreased to INR109 crores from INR143 crores in Q3 FY25, with margins temporarily impacted due to flat revenue performance, higher employee costs, and a change in product mix.
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The company has revised its FY26 guidance, indicating that consolidated revenue may be lower by up to approximately 5% and adjusted EBITDA margins may be lower by up to approximately 2% compared to earlier guidance.
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Order intake was the lowest in the last eight quarters, raising concerns about future revenue growth.
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The company faces challenges in the export market due to geopolitical situations and economic growth issues in certain regions, impacting its long-term export growth prospects.
Q & A Highlights
Q: We have seen order intake was lowest in the last eight quarters. How are you seeing this and what is your view going forward? A: Kamlesh Shah, Former CFO: In the coming quarters, we expect good business from the power sector due to substantial capacity increases. The steel sector is also growing, and we anticipate good orders from the sugar industry as well.
Q: Can you provide more details on the inquiries and bid pipeline? A: Kamlesh Shah, Former CFO: We have received significant orders from the power industry, which will be executed in the next financial year. We are confident that the inquiries in the pipeline will convert into orders, supporting growth in the coming quarters.
Q: How do you see the export market picking up, and are there any plans for inorganic acquisitions? A: Narasimhan R, CFO: We are not looking at inorganic acquisitions currently. We have been focusing on export growth through OEM partnerships and expect sustained business from these efforts. Despite geopolitical challenges, we aim to achieve 50% revenue from exports by FY30.
Q: Why are we not more aggressive in the domestic market despite strong demand? A: Narasimhan R, CFO: We maintain a strong market share in India and focus on enhancing products and reducing costs. While we aim to maintain margins, we are not aggressively pursuing market share increases that could compromise profitability.
Q: What is the growth guidance for the next three years? A: Narasimhan R, CFO: We are targeting a growth rate of 20% to 25% over the next three years, considering both domestic and export market opportunities.
Q: How prepared is the MHE division to capture growth opportunities in the power sector? A: Kamlesh Shah, Former CFO: We have a strong manufacturing setup and a dedicated design team. We are investing INR35-40 crores in machinery to expand capacity and meet future demand.
Q: What is the impact of increasing commodity prices on margins? A: Deepak Dalwadi, Head of Gear Division: Commodity prices are currently stable, and we do not foresee significant increases. We manage supplier relationships to mitigate price impacts on our margins.
Q: Can you provide an update on the INR200 crores aircraft carrier order and next-generation missile order in defense? A: Deepak Dalwadi, Head of Gear Division: We expect the RFP for the new generation missile order by Q3 of the next financial year. The aircraft carrier project RFP is expected in Q1 of FY27.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
