Summary
AXISCADES Technologies Limited - Q3 FY 2026 Earnings Call Summary Tuesday, February 10, 2026, 4:00 PM IST
Event Participants
Executives 4 Alfonso Martinez (Head of International Business & Global Operations), Dr. Sampath Ravinarayanan (Founder, Chairman and MD), Sharadhi Chandra Babu (President – Defence), Shashidhar S K (CFO)
Analysts 8 Balasubramanian (Arihant Capital), Deepak Poddar (Sapphire Capital), Dhruv Shah (Ambika Fincap), Jai Chauhan (Trinetra Asset Managers), Jatin Jadhav (Sahasrar Capital), Kaushik Mohan (Ashika Group), Mayur Parkeria (Wealth Managers India), Nirali Gopani (Unique PMS)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Revenue from Operations | ₹343 crores | +25% YoY and +14.8% QoQ; driven by aerospace, defense, and ESAI domains. |
| EBITDA | ₹63 crores | +55% YoY; highest ever quarterly EBITDA recorded by the company. |
| EBITDA Margin | 18.3% | +360 bps YoY; driven by improved business mix and operational discipline. |
| Reported PAT | ₹28 crores | +87% YoY; PAT margin stood at 8%. |
| Adjusted PAT | ₹35 crores | +10.3% margin; excludes a one-time Labour Code charge of ₹7.82 crores. |
| Net Debt | ₹67 crores | Maintained a robust balance sheet with a total Net Worth of ₹730 crores. |
| Revenue per Employee | ₹0.54 crores | +38% YoY increase from ₹0.39 crores; reflects higher delivery productivity. |
| Product vs Service Mix | 39:61 | Compared to 33:67 in Q3 FY25; strategic shift toward products and solutions. |
Geographic & Segment Commentary
- Core Domains (Aerospace, Defence, ESAI): This segment constitutes 78% of total revenue and grew 36% YoY. EBITDA margins for core domains improved to 21.4% (up 270 bps) due to accelerated program ramp-ups and robust order inflows.
- Non-Core Verticals (Heavy Engineering, Auto, Energy): Combined revenue of ₹194 crores for 9M FY26 (22% of total). Management is actively recalibrating this segment due to macroeconomic headwinds and planning a divestment by the end of FY26.
- Geographic Split: North America (ESAI and Hyperscalers) and Europe (Aerospace/Defence) each contribute roughly one-third of revenue. US revenue grew over 50% YoY, while Europe remains a steady stronghold for legacy aerospace programs.
Company-Specific & Strategic Commentary
- Power930 Vision: Management reiterated the long-term goal of reaching ₹9,000 crores in revenue by 2030, supported by a transition from services to a product-led manufacturing model.
- Infrastructure Expansion: The Devanahalli Aero Land (DAL) is fully operational for ESAI; the Devanahalli Atmanirbhar Complex (DAC) is nearing completion for radar integration; and the Missile Atmanirbhar Complex (MAC) in Hyderabad is being built for cold assembly of missiles.
- New Technology Wins: Successfully completed RF functional trials for a high-tech seeker (missile component) on February 4th and supplied platform-agnostic mission computers for the LCA Tejas.
- Inorganic Growth: The company is actively evaluating acquisitions to bolster manufacturing capabilities and meet the 2030 revenue targets.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Core Revenue Growth | 40% - 45% for FY26 & FY27 | Driven by transition to products, facility readiness, and a ₹14,000 crore pipeline. |
| EPS Growth | 40% - 50% YoY | Minimum conservative target based on higher-margin product contributions. |
| EBITDA Margin | 20% (Target FY27) | Expected expansion from 17% (FY26 avg) to 20% as product mix surpasses 50%. |
| Order Execution | ₹1,060 cr Core in FY26 | ₹200 crores shifted to FY27 due to facility certification timelines. |
Risks & Constraints
| Risk | Context |
|---|---|
| Non-Core Drag | Heavy engineering and automotive segments continue to face headwinds, weighing down overall corporate margins until the divestment is finalized. |
| Execution Delays | Approximately ₹200 crores of order execution was deferred to FY27 due to pending facility certifications and ramp-up timelines. |
| Regulatory/Lumpy Orders | Government (MOD) orders are noted as a “roll of the dice” with unpredictable timing, making short-term revenue forecasting difficult. |
Q&A Highlights
Missile Seeker Development
- Question: What is the status of the seeker development for BrahMos (Jatin Jadhav)?
- Answer: RF functionality was proven on Feb 4th; mechanical integration is expected by March with final qualification by Q2 FY27. This is the first indigenous seeker of its type (Sampath Ravinarayanan).
Strategic Move to Products
- Question: How will the margin profile change with the 80:20 product-to-service target (Deepak Poddar)?
- Answer: Services margins are declining toward 18.5%, while products/solutions yield 25-30%+. Targeting a corporate EBITDA of 25% once the flip is complete (Sampath Ravinarayanan).
Hyperscaler Opportunities
- Question: What is the potential of recent ESAI pilot orders (Dhruv Shah)?
- Answer: These are pilots for test kits for global manufacturing lines. If pilots succeed, scale-up could be 10x-50x as these customers shift manufacturing to India (Sampath Ravinarayanan/Manikandan C).
Divestment Update
- Question: Is the non-core business sale on track for March (Rohan Mehta)?
- Answer: The divestment is a primary internal goal for the Chairman and remains on track for completion by the end of the financial year (Sampath Ravinarayanan).
Key Takeaway
AXISCADES delivered a strong Q3 FY26 with 25% YoY revenue growth and record EBITDA margins of 18.3%, crossing its entire FY25 EBITDA in just nine months. The company is successfully executing its strategic pivot from low-margin engineering services to high-value defense manufacturing and ESAI solutions, with the product mix rising to 39%. Management remains committed to a 40-50% annual EPS growth trajectory, backed by a qualified pipeline of ₹14,000 crores and the imminent operationalization of three specialized manufacturing complexes (DAL, DAC, and MAC). While non-core segments remain a drag, the planned divestment by March 2026 is expected to streamline the balance sheet. Looking ahead, the company is positioned to capitalize on Indian “Atmanirbhar” defense mandates and global hyperscaler supply chain shifts, targeting a 20% EBITDA margin in FY27.
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