Elgi Equipments (ELGIEQUIP) Q2 25/26 earnings summary

Executive summary

• Revenue for Q2 FY26 increased by 11% year-over-year to INR 9,680 Mn, with all regions except Europe showing growth.

• EBITDA margin was 14.9% of revenue, down from 16.3% last year, mainly due to strategic investments and increased employee costs.

• PBT increased by 28% year-over-year to INR 1,670 Mn, including a one-off gain from a U.S. property sale; excluding this, PBT was flat.

• PAT for the quarter was INR 1,214 Mn, with a PAT margin of 12.5%.

• Board approved unaudited standalone and consolidated financial results for the quarter and half year ended September 30, 2025, with no material misstatements identified.

Financial highlights

• EBITDA for Q2 FY26 was INR 1,442 Mn, up from INR 1,419 Mn in Q2 FY25, despite higher employee and other expenses.

• Employee costs rose 15% year-over-year, with 6% from normal increments, 4% from forex impact, and 3% from headcount additions.

• Gross margin was reported at 51.9%, slightly lower than last year.

• Net cash position improved to INR 5,316 Mn as of Sep 2025, up from INR 1,897 Mn in Sep 2024, driven by better receivables and inventory management.

• Basic EPS for Q2 FY26 was 3.85, up from 2.99 in Q2 FY25.

Outlook and guidance

• Optimism for continued cash position improvement and stronger Q3 performance, especially in India and North America.

• Europe expected to remain flat in the second half, with cost reductions to improve future profitability.

• Tariff impacts in the U.S. are expected to be mitigated by cost reductions and price increases; further tariff reductions could improve margins.

• No new EBITDA or revenue guidance provided; updated guidance expected in future calls.

• Management indicates continued focus on operational efficiency and cost control.