Asian Energy Services Limited (AESL) reported a mixed performance for the second quarter, with revenue growth offset by temporary challenges and one-time costs. The company's strategic moves, including a significant acquisition and major contract wins, position it for stronger performance in the coming quarters.

Q2 Financial Highlights

AESL recorded revenue of INR 102.00 crores in Q2, demonstrating growth despite challenging conditions. However, the company reported a negative Profit After Tax (PAT) of INR 4.00 crores, primarily due to one-time costs associated with the Kuiper Group acquisition and the impact of prolonged monsoons on operations.

The company's EBITDA stood at INR 9.10 crores with a margin of 8.90%. The decline in EBITDA margin was attributed to lower business activity across several sites due to unseasonal monsoon conditions, which delayed field operations and impacted execution schedules.

Strategic Acquisition and Integration

A significant milestone for AESL this quarter was the successful completion of the Kuiper Group acquisition. This strategic move aims to strengthen the company's global presence and expand its integrated service capabilities across the Middle East and Southeast Asia. Kuiper's financials have been consolidated from September 1, contributing to one month of performance in Q2.

Kuiper is currently operating at a monthly revenue run rate of approximately INR 40.00 crores, with expectations of further improvement as integration progresses. The integration of teams, processes, and systems is underway, with management confident that these initiatives will drive operational efficiencies and support improved profitability in the coming quarters.

Major Contract Wins

AESL secured two significant contracts during the quarter, substantially boosting its order book:

1. A coal handling plant contract from Mahanadi Coalfields Limited valued at approximately INR 459.00 crores (including GST), to be executed over 7 years.
2. An integrated services contract from Vedanta Limited worth around INR 865.00 crores (including GST), to be executed over 57 months.

These contracts have strengthened AESL's order book, which now stands at more than INR 2,000.00 crores (excluding taxes and the Kuiper portfolio).

Order Book Composition

The company's order book remains robust and well-diversified:

Future Outlook

Despite the temporary setbacks in Q2, AESL's management remains confident about achieving their full-year guidance. The company expects a strong performance in the second half, driven by improving site conditions, the ramp-up of recently secured contracts, and the full integration of Kuiper Group.

The completion of the Kuiper acquisition, initiation of the Oilmax merger, and the addition of several large, long-duration contracts have significantly strengthened AESL's growth platform. These developments position the company to operate at a larger scale, participate in integrated opportunities, and build deeper capabilities across its business verticals.

As Asian Energy Services Limited continues to focus on disciplined execution, capability building, and value creation, it aims to capitalize on the growing opportunities in the energy services sector, both domestically and internationally.

Asian Energy Services Limited (AESL) has reported a significant decline in its financial performance for the second quarter of fiscal year 2026, as revealed in its latest consolidated unaudited financial results.

Revenue and Profit Decline

For the quarter ended September 30, 2025, AESL reported:

• Consolidated revenue from operations: ₹10,199.78 crore (up 4.4% year-over-year from ₹9,772.13 crore)
• Net profit after tax: Loss of ₹397.32 crore (down from a profit of ₹929.94 crore in Q2 FY25)

This significant drop in profitability can be attributed to several factors, including increased expenses and an exceptional item.

Segment Performance

AESL's financial results were divided into two main segments:

1. Oil and Gas: Revenue of ₹7,492.80 crore
2. Mineral and Other Energy Services: Revenue of ₹2,706.99 crore

Despite the overall revenue growth, both segments experienced a decline in profitability compared to the previous year.

Exceptional Item and Increased Expenses

Key factors impacting AESL's profitability included:

• An exceptional item of ₹654.39 crore
• Increases in various expense categories:
  • Project-related expenses: ₹8,121.03 crore (up from ₹7,465.46 crore)
  • Finance costs: ₹171.06 crore (up from ₹59.95 crore)
  • Depreciation, depletion, and amortization: ₹470.15 crore (up from ₹425.32 crore)

Strategic Developments

Despite financial challenges, AESL reported strategic developments:

1. Completed acquisition of Kuiper Holdings Limited and Kuiper Group Limited through its wholly-owned subsidiary, Asian Oilfield & Energy Services DMCC, on August 31, 2025.
2. Filed an application for a merger by absorption with Oilmax Energy Private Limited, pending approval from the stock exchange.

Outlook

While facing short-term financial pressures, AESL's strategic moves, including the Kuiper acquisition and the pending merger, may position it for future growth. The immediate focus will likely be on managing costs and improving profitability across its business segments.

Investors and stakeholders will be watching closely to see how AESL navigates these challenges and capitalizes on its recent strategic initiatives in the coming quarters.