Knowledge Marine & Engineering Works has initiated a postal ballot process to seek shareholder approval for related party transactions (RPTs) with its subsidiary, Knowledge Shipyard Private Limited, worth an aggregate value of ₹800 crore for FY 26-27. The transactions involve the construction and supply of vessels, including GTTP compliant green tugs, and providing guarantees, loans, or investments to the subsidiary. The company is also seeking approval to increase the limits for investments, loans, and guarantees under Section 186 of the Companies Act, 2013, from ₹75 crore to ₹500 crore.

The proposed RPTs with Knowledge Shipyard Private Limited include repairs of existing vessels and support in the construction of port ancillary crafts valued at ₹500 crore, alongside providing guarantees, security, loans, or investments worth ₹300 crore. These transactions are intended to be executed at arm’s length and in the ordinary course of business. The Board of Directors and Audit Committee have approved these proposals, which are now subject to shareholder ratification via special resolution.

Shareholders as on the cut-off date of May 29, 2026, are eligible to vote on these resolutions. The company has engaged MUFG Intime India Private Limited to facilitate the remote e-voting process. The voting period commences at 9.00 a.m. IST on Wednesday, June 03, 2026, and concludes at 5.00 p.m. IST on Thursday, July 02, 2026. The results of the postal ballot will be announced on or before Monday, July 06, 2026.

Key Agenda Items

The postal ballot notice outlines three special resolutions for shareholder consideration. The first item seeks approval and ratification for material RPTs entered into during FY 25-26, amounting to ₹35 crore. The second item requests omnibus approval for future RPTs with the subsidiary up to ₹800 crore for FY 26-27. The third item proposes an increase in the limits for investments, loans, and guarantees to ₹500 crore.

Transaction Details

The explanatory statement notes that the subsidiary, Knowledge Shipyard Private Limited, reported a turnover of ₹28.47 crore and a profit after tax of ₹2.34 crore in FY 2025-26. The company states that the transactions are designed to harness group synergies and enhance operational efficiency without compromising independence.

Knowledge Marine & Engineering Works reported a 59.5% year-on-year rise in consolidated net profit to ₹791.05 crore for the financial year ended March 31, 2026. Revenue from operations for the year increased 27.7% to ₹2,562.80 crore, driven by growth across its dredging and shipbuilding segments. The board approved the audited standalone and consolidated financial results at its meeting held on May 29, 2026. The statutory auditors, M/s L K J & Associates LLP, issued an unmodified opinion on the financial results.

For the quarter ended March 31, 2026, the company posted a consolidated net profit of ₹235 crore, compared to ₹105 crore in the same period last year. Revenue from operations for the quarter stood at ₹676 crore, up from ₹475 crore in the year-ago period. The board also appointed M/s M S K A & Associates LLP as the new statutory auditor for a term of five years, subject to shareholder approval.

The company submitted a corrigendum to the audited financial results, rectifying a classification error in the Statement of Cash Flows. An item pertaining to investing activities, specifically investment in fixed deposits, was inadvertently classified under 'Operating Activities' instead of 'Investing Activities'. Consequently, the Net cash flow from operating activities was incorrectly reported as negative. The rectification is purely classificatory and does not impact the audited consolidated and standalone financial results.

Quarterly Performance (Q4)

The following table summarises the key financial metrics for the quarter ended March 31, 2026, compared to the same period last year:

While revenue and net profit showed strong growth, the EBITDA margin contracted to 27.5% from 35.1% in the year-ago quarter, reflecting a rise in operating expenses relative to revenue.

Consolidated Financial Results (FY26)

The full-year consolidated financials reflect broad-based growth across key metrics, as detailed below:

The company's total assets for the year stood at ₹8,200.78 crore, a significant increase from ₹3,940.51 crore in the previous year. Cash and cash equivalents improved to ₹736.19 crore from ₹311.66 crore. The board also initiated a postal ballot process for the ratification of related party transactions and approval for increased limits on investments and loans under Section 186 of the Companies Act, 2013.

Order Book and Operational Highlights

The company reported a total order book of ₹1,644.89 crore, with an unexecuted balance of ₹1,395.43 crore as of the investor presentation date. The order book is diversified across dredging, charter & hire, and shipbuilding segments.

Key operational highlights include the acquisition of 15 acres of land in Saphale for a shipyard facility near the upcoming Vadhavan Port and the early adoption of Tonnage Tax for direct PAT margin expansion. The company secured significant contracts during the year, including a 15-year charter for a 60 T Bollard Pull Green Tug from V. O. Chidambaranar Port Authority valued at ₹367.09 crore and a similar 15-year contract from Vishakhapatnam Port Authority valued at ₹325.71 crore. Vessel utilization remained at 100% for the period.