Thermax reports a 19.2% rise in revenue in Q1, driven by domestic and export sales, but profit margins shrink due to order mix challenges and logistics delays, with the company optimistic about future improvements.
Thermax reported a stronger top-line in the June quarter, but profitability came under pressure as order execution shifted and some export deliveries were pushed back. Revenue rose 19.2% from a year earlier to ₹4.43bn, with domestic sales up 27.4% and exports up 10.8%, according to the company’s quarterly update. EBITDA fell to ₹513mn, narrowing the margin to 11.6% from 19.8% a year earlier, while profit after tax came in at ₹511mn.
The order pipeline remained solid. New bookings increased 6.1% to ₹5.68bn, helped by a sharp rise in exports and aftermarket business, both of which climbed 53% year on year. By contrast, domestic order intake dropped 35% and product orders fell 12%. Thermax ended the quarter with an order book of ₹21.8bn, up 5.1% from a year earlier, with exports accounting for 57% of the total and aftermarket work making up 29%.
Management said the margin squeeze reflected an unfavourable order mix from the first half of FY26, the timing of strategic orders and heavier domestic execution. Export shipments were delayed after freight rates jumped three to four times, shifting some deliveries into the second and third quarters. Thermax also executed the NTPC carbon-dioxide energy storage project at little or no margin as a technology-validation exercise. The company expects improvement through the rest of the year and has reiterated a near-term target of more than 20% PBT margin.
The outlook is still uneven. Domestic enquiries have softened and customers are taking longer to finalise orders, while international demand, especially in the US and south-east Asia, is firmer. The company said US enquiries remain healthy, though conversion can take more than a year, and noted growing interest from data centres as long gas-turbine lead times push customers towards combined-cycle alternatives. Against a mixed quarterly earnings backdrop across Indian companies, with firms including Coforge, Infosys, Wipro, LTIMindtree and KFin Technologies reporting margin pressure or cautious guidance, Thermax’s own near-term recovery is likely to depend on whether export and aftermarket momentum can offset slower domestic demand.
Disclaimer: This article is intended to inform and educate, not to recommend or endorse any financial product, investment or strategy. Please consider your own financial circumstances and seek professional advice where appropriate before making financial decisions.
