Power Mech Projects reported its unaudited financial results for the quarter ended June 30, 2026, at a Board of Directors meeting held on August 8, 2026. The results reflect a significant year-on-year improvement in profitability on both a standalone and consolidated basis, driven by higher revenue from operations across the group. The Board meeting commenced at 2:30 p.m. (IST) and concluded at 6:40 p.m. (IST).

Standalone Financial Performance

On a standalone basis, Power Mech Projects posted robust growth in revenue and profitability for the quarter ended June 30, 2026. Revenue from operations rose to ₹1,147.71 crore from ₹905.27 crore in the corresponding quarter of the previous year. Total income for the quarter stood at ₹1,178.89 crore against ₹922.21 crore in the year-ago period. Net profit after tax for the quarter came in at ₹95.66 crore, compared to ₹49.79 crore in the same quarter of the prior year. The standalone basic and diluted earnings per share (face value ₹10/- each, not annualised) for the quarter was ₹30.26, versus ₹15.75 in the year-ago quarter.

The following table summarises key standalone financial metrics:

Consolidated Financial Performance

On a consolidated basis, the group reported revenue from operations of ₹1,623.68 crore for the quarter ended June 30, 2026, compared to ₹1,293.41 crore in the corresponding prior-year quarter. Total consolidated income for the quarter stood at ₹1,632.36 crore against ₹1,304.78 crore year-on-year. Consolidated profit before tax was ₹126.38 crore for the quarter. Consolidated net profit after tax attributable to equity shareholders of the parent was ₹79.78 crore, compared to ₹52.52 crore in the year-ago quarter. The consolidated basic and diluted earnings per share (face value ₹10/- each, not annualised) for the quarter stood at ₹25.23, versus ₹16.61 in the same period of the prior year.

The following table presents key consolidated financial metrics:

Employee Stock Option Plan Approved

The Board approved a new Employee Stock Option Plan (ESOP) for granting stock options to eligible employees of the company and its subsidiary companies, subject to shareholder and regulatory approvals. Key features of the plan are outlined below:

The Nomination and Remuneration Committee (NRC) will act as the Compensation Committee for supervision of the ESOP scheme. Vesting of options shall be time-based and/or employee performance-based, as determined by the NRC.

Board-Level Changes and Other Decisions

The Board accepted the resignation of Mrs. Sajja Lakshmi (DIN: 00068991) from her position as Non-Executive and Non-Independent Director, effective from the close of business hours on August 8, 2026. Her resignation was attributed to personal pre-occupations and unavoidable commitments. The Board placed on record its appreciation for her contributions during her tenure. Additionally, the Board approved the reconstitution of various Board committees and the dissolution of the Investment Committee. The financial results were reviewed and recommended by the Audit Committee and approved by the Board in accordance with Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The statutory auditors, Brahmayya & Co., Chartered Accountants, carried out a limited review and issued an unmodified report on the results for the quarter ended June 30, 2026.

Power Mech Projects reported a consolidated net profit of ₹89.33 crore for the quarter ended June 30, 2026, marking an 11% year-on-year increase from ₹80.55 crore. Consolidated revenue from operations climbed significantly to ₹1,623.68 crore, up 26% from ₹1,293.41 crore in Q1FY25, reflecting stronger execution across its construction and maintenance portfolio. Despite the top-line growth, consolidated EBITDA declined 3% to ₹176 crore (₹176.00 crore), resulting in a margin compression to 10.78% from 13.98% in the prior year period. The divergence between robust revenue growth and contracting operating margins highlights cost pressures that warrant investor scrutiny.

The Board of Directors approved the unaudited financial results during its meeting held on August 08, 2026, in compliance with Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Statutory Auditors Brahmayya & Co conducted a limited review of the standalone and consolidated financial statements. The company also released an investor presentation on August 10, 2026, detailing segment performance and strategic outlook for FY27.

Financial Performance Overview

Consolidated earnings per share (basic and diluted) were ₹25.23, compared to ₹16.61 in Q1FY25. Standalone EPS rose to ₹30.26 from ₹15.75 in the prior year period. Other income contributed significantly to the standalone bottom line, rising to ₹31.18 crore from ₹16.94 crore year-on-year, while consolidated other income decreased slightly to ₹8.68 crore from ₹11.37 crore.

Segment Execution and Margin Pressures

Revenue growth was broad-based, supported by higher execution in Civil Infrastructure, Industrial EPC, Jal Jeevan Mission (JJM) water projects, Operations & Maintenance (O&M), and International projects. Civil Infra remained the largest contributor, accounting for ₹796 crore (49% of total revenue), followed by O&M at ₹431 crore (27%). Industrial Construction contributed ₹217 crore, while Industrial EPC and Mining, Development & Operations (MDO) added ₹96 crore and ₹84 crore, respectively.

EBITDA margin contracted by 320 basis points year-on-year primarily due to increased royalty costs in the KRBM project following a Government Order on royalty sharing for seized quantities, higher overburden removal costs at the KBP mine, and elevated material costs linked to the ongoing Middle East conflict. Chairman and Managing Director Sajja Kishore Babu noted that PAT increased mainly due to lower finance costs and reduced tax expenses, offsetting the operational margin decline.

Order Book and Strategic Outlook

The company secured new order inflows of ₹1,864 crore during Q1FY27, achieving 15.5% of its annual target. Key awards included civil and structural works for the 2×800 MW thermal power project at Salboni, West Bengal, from JSW Thermal Energy; development of Vande Bharat sleeper trains maintenance depot at Thannisandra, Karnataka; and O&M contracts from Adani Infrastructure Management Services and Maha Mumbai Metro Operation Corporation Limited (MMMOCL).

The total order backlog, including MDO contracts, stood at ₹55,398 crore, providing over two years of revenue visibility. High-margin MDO contracts worth ₹39,169 crore are now operationalized, with management expecting margin improvement as MDO revenue scales up in subsequent quarters.

What the Numbers Show

The contrast between 26% revenue growth and a 3% decline in EBITDA underscores a temporary margin squeeze driven by external cost factors rather than execution failure. While Civil Infra and O&M drove volume growth, the profitability of these segments was eroded by specific project-level cost escalations, particularly in mining royalties and global material prices. The significant rise in standalone other income suggests non-operational gains are currently supporting parent-company profitability, making the sustainability of operational margins in MDO and O&M critical for long-term value creation. With an order book exceeding ₹55,000 crore, the company has strong visibility, but investors should monitor whether MDO scale-up can effectively offset these structural cost increases in coming quarters.