Blue Star (500067) Q3 25/26 earnings summary

Executive summary

• Q3 FY 2026 saw 4.2% year-over-year revenue growth and flat operating profit amid challenging market conditions, with room air conditioners showing signs of revival ahead of the summer season.

• EBITDA increased 5% to INR 221 crore, while profit before tax declined 2% due to a one-time labor code-related expense of INR 56 crore.

• Board approved unaudited financial results for Q3 and nine months ended December 31, 2025, and made key leadership changes including re-appointment of the Managing Director.

Financial highlights

• Q3 FY 2026 consolidated revenue from operations grew to INR 2,925 crore, up from INR 2,422.37 crore last year.

• EBITDA (excluding other income) was INR 221 crore with a margin of 7.5%, up from INR 209 crore last year.

• Net profit for Q3 was INR 80.55 crore, down from INR 132.46 crore, impacted by a one-time labor code-related expense.

• Nine months revenue was INR 8,329.93 crore, up from INR 7,948.69 crore year-over-year; net profit was INR 300.15 crore, down from INR 397.28 crore.

• Earnings per share (Q3): INR 3.92 (consolidated, basic and diluted).

Outlook and guidance

• Q4 FY 2026 expected to be strong for room air conditioners, commercial air conditioning, and refrigeration products.

• FY 2027 growth outlook for Electro-Mechanical Projects is 8%-10% CAGR, with room air conditioners modeled at 18%-20% CAGR.

• Margin guidance for FY 2027: 8.5% for unitary products, 7%-7.5% for Electro-Mechanical Projects.

• Management continues to monitor regulatory changes, especially regarding new Labour Codes, and will adjust estimates as needed.