Rmc Switchgears wins Rs 333.80 crore work order from Paschim Gujarat Vij Company Ltd
Rmc Switchgears secures a Rs 333.7970307 crore LOA from Pgvc for underground cable network conversion. The order is 3.37x average quarterly revenue, boosting a thin backlog of 0.08 quarters coverage. Execution risk flagged by prior quarter losses, but Q4FY26 margins recovered to 12.31%.
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Rmc Switchgears wins Rs 333.7970307 crore work order from Paschim Gujarat Vij Company Ltd
Rmc Switchgears has received a Letter of Acceptance (LOA) valued at Rs 333.7970307 crore from Paschim Gujarat Vij Company Ltd (Pgvc). This Type A confirmed order covers site survey, designing, engineering, procurement, supply, installation, and commissioning for the conversion of existing 11 kV HT lines and LT line networks into an underground cable network with a ring main system at Chitra Subdivision of Bhavnagar Circle. The execution timeline is set for 18 months after a 45-day commencement period.
Order In Financial Context
The Rs 333.7970307 crore order represents approximately 3.37 times the company's average quarterly revenue of Rs 98.85 crore. Including this new win, the total disclosed order book stands at Rs 7.86 crore across 2 orders (sum of the 2 orders disclosed across the last 3 fiscal quarters shown in the table below). Against trailing twelve-month revenue of Rs 395.4 crore, this results in a book-to-bill ratio of roughly 0.02x. The total order book represents just 0.08 quarters of average quarterly revenue, indicating that while the new order is large relative to recent inflows, the overall backlog remains thin relative to the company's scale.
Company Order Track Record
Order inflow velocity has been stable but low in volume compared to the magnitude of this latest win. The current order value is significantly larger than the typical per-order size visible in the recent history, which consisted of smaller contracts below Rs 5.02 crore.
| Quarter: | Total Order Inflow (Rs Cr): | Key Awarding Entities: |
|---|---|---|
| Q2FY27 (Jul-Sep 2026) | 7.86 | Genus Power Infrastructures Limited, Jaipur Vidyut Vitran Nigam Limited |
Execution And Revenue Quality
The company demonstrated strong recovery in Q4FY26, posting revenue of Rs 143.60 crore and an operating profit margin (OPM) of 12.31%. This contrasts sharply with Q3FY26, where the company reported a net loss of Rs 7.10 crore and negative OPM of -12.26%, signaling previous execution stress that has since been resolved.
| Quarter: | Revenue (Rs Cr): | Net Profit (Rs Cr): | OPM (%): |
|---|---|---|---|
| Q4FY26 | 143.60 | 9.30 | 12.31% |
| Q3FY26 | 37.50 | -7.10 | -12.26% |
| Q4FY25 | 165.90 | 9.90 | 10.06% |
Revenue Growth - Order Wins Translating To Revenue
As Rmc Switchgears has sustained order wins, its annual revenue has grown from Rs 319.40 crore in FY25 to Rs 401.59 crore in FY26, representing a YoY growth of +25.7% based on the latest annual data. Despite this top-line growth, net profit declined by 29.2% in FY26 to Rs 22.31 crore, reflecting margin compression evident in the quarterly volatility.
Working Capital And Execution Capacity
The balance sheet shows a current ratio of 1.32x, providing adequate short-term liquidity to manage working capital requirements for the new project. Total liabilities/equity stands at 1.81x, which includes trade payables and other non-debt liabilities alongside any borrowings. Operating cashflow was positive at Rs 15.60 crore in FY25, suggesting the company can generate cash from operations to support execution, although free cashflow remained modest at Rs 2.60 crore due to capex outlays.
What To Watch
- Execution rate: Monitor quarterly revenue run-rate against the new Rs 333.7970307 crore backlog to assess acceleration potential over the 18-month timeline.
- OPM trajectory: Track margin quality on this large turnkey contract versus the historical average of 11.3% OPM, especially given the recent volatility seen in Q3FY26.
- Client concentration: Assess what percentage of the total disclosed order book comes from Pgvc; a single large client may introduce concentration risk if payment cycles stretch.
- Working capital cycle: With a long execution period, monitor receivables and working capital needs to ensure liquidity remains stable throughout the project lifecycle.
Key Observations
- Margin stress: Net loss of Rs 7.10 crore in Q3FY26; execution stress visible in quarterly data, though recovered in Q4FY26.
- Valuation check (as of 04 Aug 2026): P/E of 13.8x against ROCE of 40.67%. At the time of this article, valuation was pricing in execution improvement not yet fully reflected in return ratios. (P/E is price-derived and will change; ROCE is from audited financials)
- Backlog signal: Book-to-bill of 0.02x. At this level, order acquisition remains the binding constraint rather than execution capacity.
Historical Stock Returns for RMC Switchgears
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| +12.13% | +23.32% | +7.43% | -11.67% | -11.67% | -11.67% |
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