Isgec Heavy Engineering Reports Strong Q3 FY26 Results with 21% Revenue Growth
Isgec Heavy Engineering Limited reported strong Q3 FY26 results with standalone revenue growing 21% to INR1,365 crores and profit before tax increasing 27% to INR99 crores. Consolidated revenue reached INR1,765 crores with 72% growth in profit before tax from continuing operations. The company secured order bookings of INR1,426 crores, bringing total order book to INR7,649 crores. Board approved major expansion investments totaling over INR350 crores across machine building, iron castings, and skids manufacturing facilities.
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Isgec Heavy Engineering Limited delivered strong financial performance in the third quarter of FY26, demonstrating robust growth across key metrics. The company held its earnings conference call on February 10, 2026, to discuss results for the quarter and nine months ended December 31, 2025.
Financial Performance Highlights
The company reported impressive growth in both standalone and consolidated operations during Q3 FY26.
| Metric | Q3 FY26 | Q3 FY25 | Growth (%) |
|---|---|---|---|
| Standalone Revenue | INR1,365 crores | INR1,128 crores | +21% |
| Standalone PBT | INR99 crores | INR78 crores | +27% |
| Consolidated Revenue | INR1,765 crores | INR1,500 crores | +17% |
| Consolidated PBT (Continuing Operations) | INR150 crores | INR87 crores | +72% |
The significant improvement in consolidated profit from continuing operations was attributed to better performance at Isgec Heavy Engineering Limited and higher profits from the joint venture subsidiary, Isgec Hitachi Zosen Limited. The company's manufacturing divisions showed improved efficiency and capacity utilization, contributing to the strong margin expansion.
Order Book Performance
Isgec Heavy Engineering maintained strong order booking momentum during the quarter, securing new business across diverse sectors.
| Parameter | Q3 FY26 | Q3 FY25 | Growth (%) |
|---|---|---|---|
| Standalone Order Bookings | INR1,426 crores | INR1,290 crores | +11% |
| Consolidated Order Bookings | INR1,733 crores | INR1,510 crores | +15% |
| Standalone Order Book | INR7,649 crores | INR6,461 crores | +18% |
| Consolidated Order Book | INR8,709 crores | INR7,334 crores | +19% |
The order book composition shows healthy diversification across sectors and geographies. Export orders constitute INR1,629 crores, representing 21% of the standalone order book. The management highlighted that private sector orders now comprise 85% of the total order book, with PSU and government orders accounting for 15%. This shift toward private sector orders is expected to improve payment terms and reduce working capital requirements.
Major Expansion Initiatives
The company's Board approved significant capital investments to expand manufacturing capabilities across multiple divisions.
Machine Building Division Expansion
| Investment Details | Amount | Timeline | Revenue Potential |
|---|---|---|---|
| Current Expansion (Phase 1) | Ongoing | July 2026 | INR225 crores annually |
| New Expansion (Phase 2) | INR218 crores | July 2027 | INR375 crores annually |
| Total Revenue Target | - | - | INR1,000 crores annually |
The Machine Building Division, which currently generates INR400 crores annually, is being expanded to manufacture presses and industrial machinery. The expansion will cater to automotive presses, forging presses, defense applications, and nuclear sector requirements.
Additional Facility Investments
The company announced several other strategic investments:
- Machining Facility for Iron Castings: INR22.60 crores investment to establish in-house machining capabilities, expected to generate INR20 crores additional value annually
- Skids and Modules Facility at Dahej: Investment increased from INR87 crores to INR110 crores to meet anticipated demand from export and domestic markets, with completion planned by March 2027-2028
Financial Position and Borrowings
The company maintained a healthy financial position with controlled borrowing levels. On a standalone basis, total borrowings stood at INR670 crores as of December 31, 2025, compared to INR598 crores in September 2025. Net borrowings after deducting investments were INR433 crores versus INR429 crores in the previous quarter.
Consolidated net external borrowings decreased significantly to INR317 crores from INR656 crores in September 2025, representing a reduction of approximately INR340 crores during the quarter. The company funded capital expenditure of INR86 crores on standalone basis and INR100 crores on consolidated basis through internal accruals during the nine-month period.
Market Outlook and Strategy
Management expressed optimism about market demand trends, noting that overall demand continues to be encouraging with robust inquiry positions. Export inquiries have shown particular improvement, aligning with the company's strategic focus on international markets. The company is targeting better margins and improved payment terms through increased export participation.
The diversified order book spans multiple sectors including steel, cement, refineries, sugar, chemicals, and automotive industries. This diversification strategy aims to reduce dependence on any single industry and provide stability across economic cycles.
Historical Stock Returns for Isgec Heavy Engineering
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| -2.30% | +10.89% | +7.28% | -18.45% | -14.51% | +48.87% |
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