Pennar Industries Limited , a diversified engineering company, reported a strong performance in the second quarter of fiscal year 2026, with revenue rising 22.04% to Rs 919.6 crores and profit after tax (PAT) growing 20.13% to Rs 32.28 crores.

Key Highlights

• Revenue increased by 22.04% to Rs 919.60 crores
• PAT grew by 20.13% to Rs 32.28 crores
• Custom Designed Building Solutions (PEB) division delivered 31.9% revenue growth
• US subsidiary Ascent showed strong double-digit growth with order backlog expanding to $51 million
• Telco acquisition completed for $14 million enterprise value
• Body-in-white division secured new orders from Hyundai, TIVOLT, Ashok Leyland, and Stellantis
• Total order book across all segments reached Rs 956 crores

Financial Performance

The company's performance was driven by strong growth across multiple segments, particularly in the Custom Designed Building Solutions (PEB) division, which saw a 31.9% increase in revenue. This growth was achieved despite earlier labor supply constraints that temporarily impacted margins.

Aditya Rao, Vice Chairman and Managing Director of Pennar Industries, commented on the results, stating, "We are delighted to report strong growth this quarter, reflecting our continued momentum across many of our growth vectors."

Segment Performance

The PEB division's performance was particularly noteworthy, with a 31.9% revenue growth despite earlier labor supply challenges. The US subsidiary, Ascent, delivered strong double-digit growth in both revenue and profitability, with its order backlog expanding to $51 million.

The Body-in-white division secured significant new orders from major automotive manufacturers, including Hyundai, TIVOLT, Ashok Leyland, and Stellantis. Capacity expansions in this division are expected to come online in the coming quarters, potentially contributing to robust revenue growth.

Strategic Developments

Pennar Industries completed the acquisition of Telco for an enterprise value of $14 million. This acquisition is expected to contribute over Rs 100 crores annually to the company's revenue.

The company's order book remains strong, with a total of Rs 956 crores across all segments, to be executed over the next 4-6 months. This robust order book provides visibility for sustained growth in the coming quarters.

Outlook

Management expressed confidence in margin expansion from Q3 onwards, targeting a floor of 20% PAT growth going forward. The company's equity and reserves crossed the Rs 1,000 crores mark, indicating a strengthening balance sheet.

Aditya Rao highlighted the company's focus on growth vectors, stating, "We have five growth levers: Body in white business, engineering services, boilers, process equipment, pre-engineered buildings, and our U.S. business. All of these have large addressable markets where we currently have low market share, providing significant growth opportunities."

Challenges and Mitigation

The company faced some challenges related to labor supply and acquisition costs during the quarter. However, management assured that these issues have been largely resolved and are not expected to impact future quarters significantly.

Shrikant Bhakkad, Chief Financial Officer, explained, "The increase in labor costs and certain acquisition-related expenses temporarily impacted our margins. However, with these issues now addressed, we are well-positioned for improved performance in the coming quarters."

As Pennar Industries continues to focus on its core growth areas and leverage its expanded capabilities, the company remains optimistic about its future performance and ability to capitalize on market opportunities.

Pennar Industries has reported a strong financial performance for the second quarter, with significant growth across key metrics. The company's diversified portfolio and strategic focus on high-value engineering solutions have contributed to its impressive results.

Financial Highlights

Pennar Industries showcased remarkable growth in Q2, with total sales reaching ₹919.60 crores, marking a 22.04% year-over-year increase. The company's EBITDA rose by 16.32% to ₹94.43 crores, while maintaining a healthy EBITDA margin of 10.42%. Profit After Tax (PAT) grew by 20.13% to ₹32.28 crores, demonstrating the company's ability to translate top-line growth into bottom-line results.

Here's a snapshot of the key financial metrics for Q2:

Segment Performance

Pennar Industries operates through two main verticals, both of which contributed significantly to the quarter's performance:

1. Diversified Engineering: This segment generated revenue of ₹468.26 crores in Q2.
2. Custom Designed Building Solutions: This vertical contributed ₹465.72 crores to the quarter's revenue.

The balanced revenue mix between these segments (50.1% and 49.9% respectively) underscores the company's well-diversified business model.

Strong Order Book

Pennar Industries maintains a robust order book, indicating strong future revenue potential:

• PEB India: ₹860 crores
• PEB U.S.: $51.2 million

This healthy order book, particularly in the Pre-Engineered Buildings (PEB) segment, both in India and the U.S., suggests continued growth momentum for the company.

Operational Highlights

The company's operational strengths are evident in its extensive manufacturing capabilities:

• 14 ISO 9001:2008 certified manufacturing facilities in India
• Overseas manufacturing facility in Portland, USA
• Warehouse in Chicago, USA
• Engineering centers in Hyderabad and Vishakapatnam

These facilities are equipped with advanced technologies including laser cutting, plasma cutting, robotic welding, and CNC machines, enabling Pennar to produce high-quality, precision-engineered products.

Outlook

Pennar Industries' strong Q2 performance, coupled with its diverse product portfolio serving over 1,000 customers across automotive, railways, infrastructure, and industrial sectors, positions the company well for sustained growth. The expansion of its PEB business in North India with the commissioning of the Raebareli plant, and its growing international presence, particularly in the U.S. market, are likely to be key drivers of future growth.

As Pennar continues its transformation from a steel company to an engineering powerhouse with a global footprint, the company is poised to leverage its strong order book and operational efficiencies to drive further value creation.

Note: All financial figures are based on the unaudited consolidated results for Q2.