Financial Performance Highlights

Q2 FY27 Performance

  • Consolidated Revenue: INR354 crores, declined 17% Year-over-Year (YoY)
  • Standalone Revenue: INR118 crores, declined 33% YoY

H1 FY27 Performance (First Half)

  • Consolidated Revenue: INR855 crores, increased 6% YoY
  • EBITDA: INR123 crores, declined 5% YoY
  • EBITDA Margin: 14.33%
  • PAT from Continuing Operations: INR93 crores, increased 20% YoY
  • PAT Margin: 10.83%

Segment-wise Performance Analysis

Domestic Business

Faced near-term execution challenges, particularly in project division.

Product Division:

  • Q2 Revenue: ~INR62 crores (vs. INR86 crores in Q2 last year)
  • H1 Revenue: INR133 crores (vs. INR151 crores last year)
  • Order Backlog: ~INR500 crores
  • Dispatches were deferred during the quarter due to heavy monsoon conditions

Project Division:

  • Q2 Revenue: ~INR57 crores (vs. INR90 crores in Q2 last year)
  • H1 Revenue: INR100 crores (vs. INR206 crores last year)
  • Focus on commissioning ongoing projects and commencing O&M activities

International Business

Demonstrated resilience with 38% growth in H1 revenue.

International Revenue:

  • H1 Revenue: INR626 crores (vs. INR458 crores in H1 last year)
  • Strong order pipeline across product and project platforms

Regional Performance:

  • MENA Region: Gruppo Aturia expecting significant order from Kuwait Water Supply
  • Australia: Business consolidation contributing to margin profile improvement
  • Thailand: Growth opportunities following new product introductions in drainage sector
  • South Africa: PCI Africa commenced execution of new projects; Eigenbau secured repeat order from Riverton Water Works

Order Book Position

Total Order Backlog: INR6,579 crores

Product Division: ~INR1,000 crores backlog

  • International orders account for 52% of product backlog

Project Division: ~INR4,079 crores backlog

  • International projects account for 53% of project backlog
  • Domestic project order book: INR2,423 crores
  • International project order book: INR2,686 crores

O&M Order Book: ~INR545-550 crores (mix of 2-year, 5-year, and 10-year contracts)

Operational Highlights and Management Commentary

Domestic Market Outlook

  • Expect improvement in H2 supported by project commissioning and commencement of O&M activities
  • West Bengal JJM funds expected to be released starting next week (around November 7-10, 2026)
  • Approximately INR300+ crores receivable from West Bengal government
  • Focus shifting to project commissioning as fund release is tied to commissioning
  • Thermal power plant orders present significant domestic opportunities

International Market Strategy

  • South African projects have 48-month tenure with lumpy execution pattern
  • Expected traction pickup in calendar year 2027, with second year being strongest
  • All international contracts include cost variation clauses for raw material price protection
  • Geopolitical situation in MENA region affecting new contract finalization and dispatches

Margin Outlook

  • Management targets 17-18% EBITDA margin for full year
  • Gross margins remain strong despite revenue fluctuations
  • International business offsetting domestic cash flow challenges
  • Confident of margin improvement in H2 driven by revenue growth

Subsidiary and JV Updates

Thailand JV:

  • 49% ownership (due to Thai regulatory requirements)
  • Strong performance with H1 contribution of ~INR11-12 crores to share of profit
  • Expecting stronger performance following Bangkok flooding events

African Subsidiaries:

  • PCI Africa: Currently 55% ownership, with path to 100% ownership after 3-year period
  • Exploring options to improve ownership percentage in line with South African BEE requirements

European Acquisition:

  • MISA Italy successfully completed all legacy projects
  • Booked important orders during the quarter

Tax and Legal Matters

Rutschi Business Sale:

  • Tax provision of EUR 6.87 million (approximately EUR 6.8 million)
  • Claim process underway with expected 2-year timeline
  • First feedback expected in current quarter (Q3 FY27)

Future Outlook

H2 FY27 Expectations:

  • Strong second half performance anticipated
  • Domestic business improvement from both product and project segments
  • South African execution ramp-up
  • Margin improvement driven by revenue growth

Growth Strategy:

  • Focus on international expansion through acquisitions (particularly in USA)
  • Capitalizing on water infrastructure, drainage, and industrial applications globally
  • Balancing order booking with execution capabilities

Conference Participants

Management:

  • Mr. Prakash Agarwal – Managing Director
  • Mr. Krishna Kumar Ganeriwala – Executive Director
  • Valorem Advisors – Investment Guide

Moderator:

  • Mr. Abhishek Taparia – Emkay Global Financial Services Limited

Analysts:

  • Jainam Doshi (Kriis PMS)
  • Deepak (Svan Investment)
  • Balu Lamkhade (Parami Financial Services)
  • Nikunj (Carnelian Capital)
  • Saket Kapoor (Kapoor & Co.)
  • Amit (Emkay Global)