Nava (513023) Q3 25/26 earnings summary

Executive summary

• Q3 FY26 consolidated revenue reached ₹1,061.5 Cr, up 7.3% sequentially and 20.9% year-over-year, with net profit at ₹325.7 Cr, an 83.5% increase quarter-over-quarter, reflecting strong asset quality and disciplined capital allocation.

• Energy business remained resilient, with high plant availability and improved mining volumes and margins, while the Indian energy segment faced revenue decline due to planned shutdowns and lower demand.

• Mining division revenue rose 16.6% sequentially, and ferro alloys saw increased production and sales, though margins remained low.

• Achieved a key milestone with the $50 million Nava Global buyback, maintaining 100% ownership.

• PAT margin improved to 30.7%, with earnings per share at ₹7.84 for the quarter.

Financial highlights

• EBITDA for Q3 FY26 was ₹513.0 Cr, with an EBITDA margin of 48.3%, up from 34.5% quarter-over-quarter, driven by MEL power plants operating at 97% PLF.

• Other income rose sharply to INR 70.4 crore in Q3, mainly due to foreign currency fluctuations; sustainable other income estimated at INR 40 crore per quarter.

• Cost of materials decreased by 21.4% sequentially, supporting margin expansion.

• Earnings per share for the quarter stood at ₹7.84 (consolidated) and ₹4.79 (standalone).

• Employee costs increased from INR 191 crore to INR 268 crore over nine months, attributed to commission provisions and new labour codes.

Outlook and guidance

• MEL's Phase II 300 MW power project and Maamba Solar's 100 MW project in Zambia are targeted for commissioning in FY27, expected to generate $180-200 million and $15-16 million in annual revenue, respectively.

• Avocado plantations and Kawambwa sugar project progressing, with avocado segment expected to become significant in 4-5 years and full production in 8 years.

• No major plant shutdowns planned for FY26 and FY27; regular maintenance expected.

• Management remains confident in the recoverability of significant overdue receivables from a key Zambian customer, supported by a sovereign guarantee and arbitration award.

• The company will continue to monitor the impact of new labour codes and adjust provisions as further rules are notified.