Summary
Engineers India Limited - Q3 FY 2025-26 Earnings Call Summary Friday, February 13, 2026 2:00 PM
Event Participants
Executives 6 Amanpreet Singh Chopra (SGM, C&MD Office and IR), Neha Narula (Senior Manager), R.P. Batra (Executive Director), Sanjay Jindal (Director - Finance), Suvendu Padhi (Company Secretary), Vivek Midha (CGM - Marketing and BD)
Analysts 8 Amit Anwani (PL Capital), Darshika Khemka (AV Fincorp), Kaushal Sharma (Equinix Capital), Manish Ostwal (Nirmal Bang), Manoj Sah (LaxGov Investments), Mohit Kumar (ICICI Securities), Nilesh Doshi (Prospero Tree), Palash Jain (ICICI Securities)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Order Book | ₹15,670 crores | +25% QoQ; Highest in company history following major jan 2026 wins. |
| Total Turnover | ₹1,194 crores | +59% YoY; Reflects stronger execution and structural reversal adjustments. |
| Consultancy Revenue | ₹474 crores | +4.9% YoY; Segment margins maintained at healthy 20-25%. |
| Turnkey Revenue | ₹720 crores | +144% YoY; Driven by high project activity and write-backs. |
| EBITDA | ₹406 crores | +154% YoY; Significant boost from ₹213cr provision reversal. |
| EBITDA Margin | 32% | +1500 bps YoY; Inflated by one-time LD reversal; normalized at ~10-15%. |
| PBT | ₹395 crores | +235% YoY; Reflects strong operational performance and reversal of project provisions. |
| PAT | ₹302 crores | +243% YoY; Quarterly EPS stood at ₹5.37 vs ₹2.04 in Q2. |
| Order Inflow (YTD) | ₹7,700 crores | On track to cross ₹8,000 crores for the full year. |
Geographic & Segment Commentary
- International: Significant scale-up in Nigeria with the ₹3,250 crore Dangote refinery expansion and ₹615 crore fertilizer project. Strategic focus is shifting to Abu Dhabi (ADNOC empanelment), Saudi Arabia, Oman, and Kuwait to leverage high-quality engineering expertise over pure L1 pricing.
- Consultancy & Engineering: Remains the core value driver with an order book of ₹10,700 crores (68% of total). Management anticipates a 3-4 year execution cycle with heavy engineering invoicing expected in FY27.
- Turnkey (LSTK/OBE): Transitioning toward Open Book Estimate (OBE) models to mitigate cost escalation risks. Current margins are protected through cost-plus structures where the client bears inflation and EIL earns a fixed markup.
Company-Specific & Strategic Commentary
- Provision Reversal Mechanics: A one-time gain of ₹213 crores was booked following the successful completion of a ₹6,000 crore project without Liquidity Damages (LD), allowing reversal of historical conservative provisions.
- Infrastructure Diversification: Focusing on niche segments (25-30% of inflows) including green airports (Leh), data centers (SBI/RBI), and institutional campuses (IIT/IIM) rather than commodity residential construction.
- Energy Transition: Engaging in coal gasification for NTPC and conducting internal studies on Carbon Capture, Utilization, and Storage (CCUS) following new budgetary allocations.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Annual Revenue | >₹4,000 crores (FY26) | Minimum target based on current record order book and execution run-rate. |
| Order Inflow | >₹8,000 crores (FY26) | Replicating last year’s performance with 10-15% growth targeted for FY27. |
| Segment Margins | 22-25% (Consultancy) | Sustainable long-term range for high-value engineering services. |
| Turnkey Margins | ~7% (Sustainable) | Normalized expectation for OBE/LSTK projects excluding one-time reversals. |
Risks & Constraints
| Risk | Context |
|---|---|
| Earnings Volatility | Revenue and profit fluctuate based on project milestones and the timing of provision reversals, making quarterly modeling difficult. |
| Client Concentration | Heavy reliance on PSU investment cycles and large-scale international projects like Dangote (Nigeria) creates concentration risk. |
| Execution Delays | Long gestation periods (36-42 months) expose the company to potential liquidity damages if time extensions are not granted by clients. |
Q&A Highlights
Project Reversals
- Question: Why was there such high volatility in margins this quarter? (Manish Ostwal)
- Answer: A reversal of ₹213 crores in profit occurred because a major project (>₹6,000cr) was completed within the extended time allowed by the client, negating the need for previously held LD provisions (Sanjay Jindal).
International Pipeline
- Question: What is the status of the Guyana refinery and Middle East expansion? (Mohit Kumar)
- Answer: Guyana is in early conceptual stages for a small 30k BPSD unit. In the Middle East, we are now empaneled with ADNOC for engineering services, shifting focus to quality-led bidding (Vivek Midha).
JV Performance
- Question: How is the Ramagundam Fertilizer (RFCL) JV performing? (Manish Ostwal)
- Answer: The plant is now stabilized and running at 100% capacity as of Feb 2026; Q4 and FY27 should see consistent profit contributions (Sanjay Jindal).
Future Pipeline
- Question: Is the Indian petchem pipeline exhausted? (Palash Jain)
- Answer: No, energy demand is set to double by 2040. Major projects like the Andhra refinery and Paradip expansions are on the anvil for next year (Vivek Midha).
Key Takeaway
Engineers India Limited delivered a historic quarter, achieving its highest-ever order book of ₹15,670 crores, bolstered by a landmark ₹3,250 crore international win in January 2026. While Q3 FY26 profitability was significantly inflated by a ₹213 crore provision reversal related to a major project completion, the underlying operational trend remained robust with 45% YoY revenue growth in the nine-month period. Strategy has pivoted decisively toward international markets (Nigeria and UAE) and niche infrastructure, while the domestic Turnkey business has been de-risked through the Open Book Estimate (OBE) model. Management anticipates crossing ₹4,000 crores in revenue for FY26 and expects FY27 to benefit from the early engineering phases of recent mega-wins. Investors should monitor the normalization of margins as the high-margin consultancy book enters peak execution and the impact of the upcoming pay commission on staff costs.
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