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Thermax reported a weak Q1FY27 performance

ICICIdirect Research 31 Jul 2026 DISCLAIMER

News: Thermax reported a weak Q1FY27 performance, with consolidated revenue rising 6.7% YoY to ₹2,303 crore. However, EBITDA declined 69.5% YoY to ₹68.6 crore, with EBITDA margin contracting 745 bps YoY to 3.0%. Consequently, PAT declined 85.6% YoY to ₹21.8 crore. During the quarter, order inflow increased 2% YoY to ₹2,809 crore, while the order book grew 23% YoY to ₹14,045 crore, providing healthy revenue visibility.Segment-wise, Industrial Products revenue grew 11.4% YoY to ₹1,058 crore, supported by domestic demand, though profitability was impacted by lower exports; Industrial Infra revenue declined 2.8% YoY to ₹814 crore, with the segment reporting a ₹70.7 crore EBIT loss owing to the project cost overrun; Green Solutions revenue increased 3.0% YoY to ₹245 crore, though the segment remained loss-making; while Chemicals delivered a strong performance, with revenue rising 32.5% YoY to ₹230 crore and EBIT increasing 59.5% YoY to ₹25.6 crore.

View: Thermax reported a weak Q1FY27 performance, with profitability impacted by a ₹91 crore cost overrun in a single Industrial Infra project, lower export sales in the Industrial Products segment and the absence of ₹56 crore Package Scheme of Incentives (PSI) income recognised in Q1FY26. Even after adjusting for these one-off factors, operating performance remained subdued, with adjusted EBITDA declining 5.6% YoY to ₹159.6 crore, adjusted EBITDA margin contracting 111 bps YoY to 6.9%, and adjusted PAT falling 5.7% YoY to ₹90.1 crore, reflecting continued pressure from weak exports and losses in the Industrial Infra and Green Solutions businesses. Nevertheless, the 23% YoY growth in the order book to ₹14,045 crore and 2% YoY increase in order inflow provide healthy revenue visibility. Going forward, recovery in project execution, margin improvement in the Industrial Infra segment, revival in export demand and sustained order inflows will remain the key monitorables.

Impact: Negative

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