Everest Kanto Cylinder Limited (EKC), a leading manufacturer of high-pressure gas cylinders, has reported its financial results for the second quarter of fiscal year 2026, showcasing steady performance amidst market transitions.

Financial Highlights

EKC delivered a consolidated revenue of ₹360.40 crores in Q2FY26, with an EBITDA of ₹42.90 crores, translating to a margin of 11.90%. The company's PAT (Profit After Tax) for the quarter stood at ₹13.70 crores. On a standalone basis, the revenue was ₹232.40 crores, with an improved margin of 11.20% compared to 9.30% in the same period last year.

Segment Performance

The CNG segment in India experienced temporary softness due to GST transition impacts in the end-user automotive industry. However, the company reports that this has since normalized, and the underlying domestic demand environment remains supportive. The Industrial segment continues to perform in line with expectations.

International Operations

EKC's US business reflected the order-driven nature of the market, with lower dispatches during the quarter. However, the performance for the first half of the fiscal year remains healthy. The US operations faced higher operating costs, impacting margins, as the company invested in strengthening teams and capabilities to support business scale-up. The outlook for the US market remains strong, with a healthy order book providing visibility for the second half of FY26.

Operations in the Middle East have shown early signs of improvement during the quarter.

Expansion Plans

EKC is making steady progress on its new facilities:

1. Egypt Plant: Preparing to begin trial production by January 2026.
2. Mundra Facility: Work continues as planned, expected to be operational by March 2026.

Both facilities are on schedule and will significantly enhance EKC's manufacturing capabilities in the coming year, enabling the company to serve a wider range of domestic and international opportunities.

Management Commentary

Puneet Khurana, Managing Director of EKC, commented on the results: "With growing opportunities across clean energy and industrial applications, coupled with great visibility in our order pipeline, we remain confident about our future growth perspectives. Our focus remains on operational excellence, capability development, and supporting customers across geographies, as we build for the next phase of growth for EKC."

Future Outlook

The management has provided revenue guidance of ₹900-1,000 crores for the standalone business for FY26, with an expected EBITDA margin of 12-14%. The company's order book stands at approximately ₹1,000 crores, executable over the next year, indicating strong growth potential.

EKC continues to explore opportunities in emerging sectors such as hydrogen storage, semiconductors, and solar energy, while maintaining its strong position in the CNG and industrial gas segments. The company is also catering to the defense sector, though specific details remain confidential due to the nature of the projects.

As Everest Kanto Cylinder Limited navigates through market transitions and expands its manufacturing footprint, the company appears well-positioned to capitalize on the growing demand for high-pressure gas cylinders across various industries.

Everest Kanto Cylinder Limited (EKC), a leading manufacturer of seamless steel gas cylinders, has reported its financial results for the second quarter of fiscal year 2026, showing a mixed performance amid temporary challenges in the CNG segment.

Key Financial Highlights

Performance Analysis

EKC reported a consolidated revenue of Rs 360.40 crore for Q2FY26, marking a slight decline of 1.90% compared to the same quarter last year. The company's EBITDA stood at Rs 42.90 crore, with a margin of 11.90%, showing a decrease from the previous year's 14.50%. The Profit After Tax (PAT) for the quarter was Rs 13.70 crore, significantly lower than the Rs 38.60 crore reported in Q2FY25.

Segment-wise Performance

The company faced temporary demand impact in the CNG segment due to the GST transition in the automotive industry. This transition appears to have affected the domestic volumes in the short term. However, the company's management noted that activity has since normalized as the industry moved into October, with underlying demand indicators remaining supportive.

The Industrial business segment continued to perform in line with expectations, providing some stability to the overall performance.

International Operations

EKC's US operations reflected the order-driven nature of the business, with lower dispatches during the quarter. However, the segment remains healthy on a half-yearly basis, and the outlook for the region in the second half of the fiscal year remains strong, supported by a robust order book.

Operations in the Middle East showed early signs of improvement during the quarter, indicating potential growth in this region.

Expansion Plans

EKC is progressing well with its new facilities at Mundra (India) and Egypt. The Egypt plant is preparing to begin trial production shortly, while construction at Mundra continues to advance as planned. Both facilities are on track and are expected to enhance the company's manufacturing capabilities in the coming year, enabling better service to domestic and international markets.

Management Commentary

Mr. Pushkar Khurana, Chairman and Executive Director, and Mr. Puneet Khurana, Managing Director, in a joint statement, expressed confidence in the company's future growth prospects. They stated, "With growing opportunities across clean energy and industrial applications, coupled with greater visibility in our order pipeline, we remain confident about our future growth prospects. Our efforts remain centred on advancing our capabilities, improving operating efficiency, supporting customers across domestic and international markets, and strengthening our leadership position in India."

Outlook

Despite the temporary setbacks in the CNG segment, EKC's management remains optimistic about the company's future. The expansion of manufacturing facilities, coupled with a strong order book in the US and improving conditions in the Middle East, suggests potential for growth in the coming quarters. The company's focus on clean energy solutions and industrial applications positions it well to capitalize on the increasing usage of gases in industrial production and the automobile sector.