Elecon Engineering Company (505700) Q3 25/26 earnings summary

Executive summary

• Consolidated Q3 FY26 revenue grew 4.3% year-on-year to INR 552 crores, with resilient performance despite order execution delays and customer-driven dispatch deferments.

• The company is a leading Asian manufacturer of industrial gears and material handling equipment, celebrating 75 years, with a global footprint and strong domestic market leadership.

• Gear Division contributed 78% of revenue, showing flat growth due to timing-related factors, while MHE Division delivered 16% year-on-year growth, driven by strong demand in power, cement, mining, and ports.

• Strong order book and inquiry pipeline provide visibility for future growth, with domestic market contributing 76% and overseas 24% of revenue.

• The resignation of the CFO, effective 31st January 2026, was accepted due to personal reasons.

Financial highlights

• Q3FY26 consolidated revenue was ₹552 crore, up 4.3% YoY; EBITDA at ₹109 crore (19.8% margin), down 23.4% YoY; PAT at ₹72 crore (13.0% margin), down 33.1% YoY.

• 9MFY26 revenue reached ₹1,620 crore (+13.4% YoY), EBITDA ₹340 crore (21.0% margin), PAT ₹228 crore (14.1% margin).

• Order intake for Q3FY26 was ₹701 crore (+4% YoY); open order book at Dec 31, 2025, stood at ₹1,372 crore (+24.2% YoY).

• One-time arbitration income of ₹25 crore recognized in MHE Division, plus ₹80 crore exceptional income from investment reclassification.

• Interim dividend of ₹0.50 per share declared and paid in November 2025.

Outlook and guidance

• FY26 revenue expected to be up to 5% lower and adjusted EBITDA margin up to 2% lower than earlier guidance due to near-term softness.

• Management remains confident of improvement beyond near term, supported by a healthy order book and robust inquiry pipeline.

• Export revenue targeted to reach 50% by FY30, with 20-25% growth expected in overseas markets over the next three years, subject to geopolitical factors.