Subros Limited announced its unaudited financial results for Q3FY26 ended December 31, 2025, demonstrating strong operational performance across key metrics. The thermal products manufacturer reported significant revenue growth and maintained healthy profitability despite facing exceptional charges related to new labour regulations.

Financial Performance Highlights

The company's financial performance for Q3FY26 showed robust growth across multiple parameters:

For the nine months ended December 31, 2025, revenue from operations reached Rs. 2,70,576 lakhs compared to Rs. 2,45,911 lakhs in the corresponding period last year, representing a growth of 10.00%. Net profit for the nine-month period stood at Rs. 11,609 lakhs versus Rs. 10,420 lakhs in the previous year.

EBITDA Performance Analysis

While EBITDA grew to Rs. 814M from Rs. 758M year-on-year, the EBITDA margin compressed to 8.59% from 9.24% in the corresponding quarter last year. This margin compression of 65 basis points reflects the impact of higher input costs and exceptional charges, despite strong revenue growth momentum.

Exceptional Items Impact

The company recorded an exceptional charge of Rs. 808 lakhs in Q3FY26 due to the implementation of new Labour Codes notified by the Government of India on November 21, 2025. This impact consists of gratuity provisions of Rs. 691 lakhs and leave encashment of Rs. 117 lakhs, primarily arising from changes in wage definition under the consolidated labour laws.

Strategic Capacity Expansion - Rs. 265 Crores Investment

The Board approved significant capacity expansion plans at the Karsanpura, Gujarat manufacturing facility with a total investment of approximately Rs. 265 crores:

Electric-Compressor Capacity Addition:

ICE-Compressor Expansion:

Leadership Changes

The company announced key changes in its Board composition with new nominee directors from DENSO Corporation, Japan. Mr. Yusuke Hara resigned as Nominee Director, and Mr. Naohisa Kuriyama was appointed as his replacement, effective January 30, 2026. Mr. Kuriyama serves as Head of Thermal Management Systems Business Unit at DENSO Corporation and brings extensive experience in air-conditioning systems development.

Simultaneously, Mr. Tsunenobu Hori was appointed as Alternate Director to Mr. Kuriyama. Mr. Hori currently serves as CEO of DENSO India Region companies and has over two decades of experience with DENSO Corporation and Toyota Motor Corporation. Both appointments are subject to shareholder approval through a postal ballot process.

Operational Metrics

The company's cost structure remained well-managed during the quarter. Cost of materials consumed was Rs. 69,698 lakhs in Q3FY26 compared to Rs. 59,159 lakhs in Q3FY25. Employee benefits expense increased to Rs. 8,981 lakhs from Rs. 7,912 lakhs in the corresponding quarter last year, reflecting business growth and regulatory changes.

Other income for the quarter included Rs. 64 lakhs from government grants under the Gujarat Incentive to Industries Scheme. The company maintained its focus on thermal products as its single business segment, continuing to strengthen its market position in automotive air-conditioning systems.

Subros Ltd has secured a major business award from Maruti Suzuki India Limited for supplying locally manufactured electric compressors for hybrid vehicles. The contract represents a significant milestone for the automotive component manufacturer in the rapidly evolving electric and hybrid vehicle market.

Contract Details and Value

The business award encompasses the supply of electric compressors specifically designed for Maruti Suzuki's hybrid car portfolio. The comprehensive deal structure highlights Subros' capability in manufacturing advanced automotive components locally.

Strategic Partnerships Enhanced

This business win significantly strengthens Subros' relationships with key industry players. The contract reinforces the company's position as a trusted supplier to Maruti Suzuki India Limited while also enhancing its ties with Denso Corporation. These partnerships are crucial for Subros' growth strategy in the automotive components sector.

Market Positioning

The award positions Subros as a key player in the hybrid vehicle component supply chain. By securing this substantial contract, the company demonstrates its technical capabilities and manufacturing expertise in producing electric compressors for the automotive industry. The focus on local manufacturing aligns with industry trends toward domestic production and supply chain optimization.

Business Impact

This seven-year contract provides Subros with long-term revenue visibility and strengthens its market position in the automotive components industry. The partnership with Maruti Suzuki for hybrid vehicle components represents the company's successful adaptation to evolving automotive technologies and market demands.