Thermax Limited reported an 85% year-on-year decline in consolidated net profit after tax (PAT) to ₹21.79 crore for the quarter ended June 30, 2026, primarily driven by a ₹91 crore increase in estimated costs to complete a single project within its Industrial Infra segment. Despite the sharp contraction in profitability, the company’s consolidated revenue from operations grew 7% to ₹2,302.73 crore from ₹2,157.53 crore in the corresponding period of the previous year. The divergence between top-line growth and bottom-line collapse underscores significant execution risks in the infrastructure vertical, even as the total order book expanded by 23% to ₹14,045 crore.

The Board of Directors approved the unaudited standalone and consolidated financial results at its meeting held on July 30, 2026. The results were subjected to a limited review by statutory auditors Price Waterhouse Chartered Accountants LLP. In addition to approving the financials, the Board sanctioned a composite Scheme of Arrangement and Amalgamation involving wholly-owned subsidiaries Thermax Bioenergy Solutions Private Limited (TBSPL) and Thermax Cooling Solutions Limited (TCSL). The scheme aims to simplify the group structure and reduce administrative overheads, with an appointed date of April 1, 2026.

Financial Performance Highlights

Consolidated profit before tax (PBT) dropped 80% to ₹42.14 crore from ₹211.47 crore in the prior year quarter. The comparative quarter benefited from ₹56 crore in income under the Package Scheme of Incentives (PSI) for a subsidiary in the Industrial Infra segment, whereas current quarter PSI income was only ₹2.47 crore. Standalone operations also faced headwinds, reporting a net loss of ₹18.10 crore compared to a profit of ₹46.52 crore in the prior year, largely due to the same project cost overrun. EBITDA for the quarter declined sharply to ₹69 crore from ₹225 crore in the year-ago period, with the EBITDA margin contracting significantly to 3% from 10.47%.

The following table summarises the key consolidated financial metrics for the quarter:

Segmental analysis reveals divergent trends across business verticals. The Industrial Products segment, the largest revenue contributor at ₹1,058.16 crore, saw its operating profit decline to ₹64.18 crore from ₹79.27 crore, impacted by lower export sales. Conversely, the Chemicals segment improved its profitability to ₹25.64 crore from ₹16.08 crore. The Green Solutions segment continued to report a loss of ₹16.85 crore, slightly widening from a ₹5.34 crore loss in the previous year. The Industrial Infra segment reported a loss of ₹70.66 crore compared to a profit of ₹83.26 crore in the prior year, directly reflecting the ₹91 crore cost overrun.

Operational Updates and Restructuring

Order bookings for the quarter stood at ₹2,809 crore, up 2% from ₹2,748 crore in the prior year quarter. A significant milestone was the securing of an order worth over ₹400 crore for boiler pressure parts for a data centre project in the USA. The Green Solutions segment's reported order book increased by ₹139 crore due to a change in reporting methodology by Thermax Onsite Energy Solutions Limited (TOESL), which now uses a rolling 12-month forecast model rather than recognising only the first year's revenue from long-term contracts.

The approved amalgamation scheme involves the demerger of the Bio-Compressed Natural Gas (Bio CNG) EPC business from TBSPL into Thermax Limited, while TBSPL retains its Operations and Maintenance (O&M) business. Simultaneously, TCSL will merge entirely into Thermax Limited. Management stated that this consolidation is expected to improve key financial ratios and result in annual cost savings. The scheme requires approval from the National Company Law Tribunal (NCLT) and other regulatory authorities. There will be no change in the shareholding pattern of Thermax Limited as no new shares are being issued.

What the Numbers Show

The divergence between top-line growth and bottom-line collapse highlights significant execution risk in the Industrial Infra segment. While revenue grew 7%, the ₹91 crore cost overrun wiped out nearly all operating leverage, reducing PAT margins from 7.0% to just 0.9%. This suggests that while demand remains strong (evidenced by the 23% rise in order book), margin stability is vulnerable to project-specific cost escalations, particularly in the PSU and export-heavy Infra vertical where revenue mix shifted towards lower-margin services.

In its latest concall update, thermax has shared forward-looking business commentary across several of its key segments, highlighting growth expectations in industrial products, chemicals, and newer business verticals. The company's management outlined specific revenue targets and order momentum across divisions, providing investors with a detailed picture of its near-term operational outlook.

Industrial Products and Chemical Segment Outlook

Thermax anticipates yearly growth in its industrial products segment, signalling continued demand momentum in this core business area. On the chemicals front, the company expects revenue to rise by at least 20% in FY27, reflecting confidence in the segment's expansion trajectory. This guidance underscores the company's focus on scaling its chemical business as a meaningful contributor to overall revenues.

Green Solutions, Purcell, and Tosyl — Strong Order Growth

Several of Thermax's business verticals have recorded strong order growth, as highlighted during the concall. The following segments were specifically called out for their order momentum:

• Green Solutions — experiencing strong order growth
• Purcell — experiencing strong order growth
• Tosyl — experiencing strong order growth

This broad-based order momentum across these three verticals indicates healthy demand across Thermax's diversified portfolio.

Tosyl Revenue Target

Among the highlighted developments, Tosyl's revenue ambitions stand out as a key milestone. The company has announced that Tosyl is aiming to achieve revenues of ₹800 to ₹1000 crore within two years on a consistent basis. The following table summarises the key guidance metrics shared during the concall:

The management's commentary reflects a broad-based optimism across Thermax's business segments, with both established verticals like industrial products and chemicals, as well as newer growth areas such as Green Solutions and Tosyl, contributing to the company's overall growth narrative.