Elecon Engineering share price in focus: Elecon Engineering Company Ltd. primarily serves core sectors like cement, steel, mining, sugar, marine, and defence through custom-built gearboxes, material handling equipment, and castings.
Financial performance Q4 FY26; for the quarter ended March 2026, the company consolidated revenue from operations stood at Rs 746 crores compared to Rs 798 crores in the corresponding quarter of the last year, reflecting a moderate year-on-year contraction.
i) Order backlog at Rs 13 billion is well-diversified, supported by strong long-term demand drivers across key end-user industries such as power, steel, cement, mining, and material handling equipment (MHE).
ii) The company maintains a strong financial position, with net cash increasing to Rs 7 billion in FY26 from Rs 5.5 billion in FY25, backed by healthy operating cash flow generation, averaging Rs 3-3.5 billion annually over the past two years.
This robust balance sheet provides adequate flexibility to pursue future growth opportunities and strategic investments.
iii) During the year, Elecon recognised a one-time goodwill impairment charge of Rs 1 billion related to the acquisitions of Benzlers and Radicon undertaken in FY11, which impacted reported profitability.
iv) On the international front, Elecon further strengthened its global presence by incorporating a subsidiary in Mexico to expand its footprint and better serve customers in the Latin American market.
v) The management has also outlined a capex program of Rs 4 billion over FY26-28, focused on capacity enhancement, modernisation, and operational improvements, with Rs 1 billion already invested.
Elecon Engineering Q4 results
The company’s profitability was impacted by operating deleverage due to lower revenue conversion, marginally higher employee costs, and a change in the product mix. Net profit for the quarter came in at Rs 108 crores, translating into a PAT margin of 14.5%. This excludes the one-time impairment of goodwill of Rs 102 crores, recognised as an exceptional item.
For the full year FY26, adjusted consolidated revenue stood at Rs 2,341 crores compared to Rs 2,227 crores in FY25. This excludes the realised arbitration award of INR25 crores recorded in the first quarter of FY26 in the MHE division. Adjusted EBITDA for FY26 stood at INR498 crores, with margins of 21.3%, remaining broadly stable despite near-term execution volatility.
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money related decisions.)
