Harsha Engineers International (HARSHA) Q3 25/26 earnings summary

Executive summary

• Q3 FY26 performance was broadly in line with expectations, with strong growth in India and Europe, but Romania underperformed due to commodity price volatility.

• Consolidated revenue in Q3 FY26 grew 20.7% year-over-year to ₹40,925 lakhs, with adjusted EBITDA and PAT up 41.6% and 42.7% year-over-year, respectively, after a one-time labor code provision.

• India engineering business posted 17.4% YOY revenue growth and robust top-line and bottom-line performance, though Harsha Advantek reported a PAT-level loss due to higher interest and depreciation from its new facility.

• The group includes subsidiaries in China, Romania, and India, and a joint venture in solar energy.

• Unaudited standalone and consolidated financial results for Q3 FY26 were approved and reviewed without qualification by the audit committee and statutory auditors.

Financial highlights

• Q3 FY26 consolidated revenue was ₹40,925 lakhs, up from ₹33,894 lakhs in Q3 FY25; consolidated EBITDA was ₹6,410 lakhs (15.7% margin), and PAT was ₹3,360 lakhs (8.2% margin).

• Solar business achieved revenue of ₹5,971 lakhs and EBITDA of ₹554 lakhs in Q3 FY26.

• Working capital cycle improved to 140 days, with inventories at 84 days, receivables at 33 days, and trade creditors at 33 days as of Q3 FY26.

• CapEx of ₹3,200 lakhs in Q3 and ₹10,000 lakhs cumulatively for the first three quarters; Advantek CapEx expected to reach ₹25,000+ lakhs by year-end.

• Basic and diluted EPS for Q3 FY26 were ₹3.69 (consolidated) and ₹4.58 (standalone).

Outlook and guidance

• FY26 is expected to close with a little over 10% overall growth, with Q4 maintaining or slightly improving the current run rate.

• Margins are expected to improve in Q4, with a targeted PAT of around ₹14,500 lakhs for FY26.

• Brownfield expansion in China planned with $9.94 million investment to be completed by FY28, funded 70-80% by local borrowing and the rest by equity from India.

• Guidance for FY27 will be provided after Q4 results.

• The company is monitoring the impact of new Indian labour codes and will update future financials as more regulatory clarity emerges.