THERMAX Q2 FY26 earnings call.
A source-linked concall view: reported numbers, management language, guidance, commitments and risks that should carry forward.
ConCallIQ research layer
Signal, with the source still visible.
Use the controls below to narrow the view, then follow the evidence into the next layer of context.
Revenue
₹2,474 Cr
verified against source
Revenue YoY
—
reported change
EBITDA
Pending
latest reported figure
Source
screener in
record provenance
Actual signal trajectory
Where this quarter sits.
Quarter read
What the record says.
Thermax's Q2 FY26 proved to be a "kitchen sink" quarter as the management acknowledged, with significant project execution hits primarily from legacy low-margin contracts in industrial infrastructure. An engineering surprise on a large refinery project (NRL) contributed to the pain, though management characterized this as largely behind them. The remaining backlog of INR 570 crore in Industrial Infra (62% to be executed in H2, 38% in FY27) is viewed as more manageable. The chemicals segment faced headwinds from Chinese competition and volume softness (plant utilization fell to 40%), though recovery is expected in Q3. On the positive side, TBWES secured a prestigious Middle East boiler order from a marquee upstream oil & gas customer, domestic orders grew 25% YoY, and heating products achieved their highest-ever quarter. Management guided for 20%+ total order growth for FY26 and expects a strong H2 with significant revenue catch-up in Q3. New order quality is improving with target margins of 5-8% domestic and 10%+ international for projects. Risks include ongoing NRL project execution into FY27, bio-CNG policy uncertainty, and potential margin mix headwinds as faster-growing water/Enviro segments carry lower profitability than heating.
Colored figures show movement against the previous available record.
Guidance to track
- Management commits to at least 20% order growth year-on-year on total Thermax portfolio, driven by strong H2 with Q3 and Q4 expected to be up well above 30% each vs weak comparable base.
- Management expects big revenue catch-up in Q3 driven by execution of INR 700 crore of water projects and overall strong H2. Expects Q3 and Q4 both to match Q4 FY25 levels.
- New project orders expected at 5-8% PBT for domestic and 10%+ for international, with services included aiming for ~10% blended margins at PBT level for industrial infra going forward.
- Currently at INR 200 crore quarterly order book; expects to reach INR 230-240 crore imminently in Q3 and INR 250 crore where business can return to 'teens' profitability.
Risks flagged
- INR 180 crore remaining on NRL refinery project; management working to clear by early next year but some execution risk remains into FY27 as noted by analyst Jonas Bhutta.
- Technology stabilizing below industry commitments; projects reaching single-digit profitability but still not commercially viable. Requires policy intervention on green credits, power tariffs, digestate pricing, and rice straw pricing - PMO-driven topic with timing uncertain.
- Hyperscalers increasingly adopting liquid cooling at chip level; management acknowledged conventional cooling may not be needed for some applications. Gap between TAM and SAM in cooling solutions remains to be clarified. Analyst Rajakumar pressed on whether this is CapEx or service opportunity.
- Water and Enviro growing faster but at 'low double digit' margins vs heating at 'mid to high teens'; as water/Enviro scale up, overall industrial products margin profile may face compression despite absolute profit growth.
Key quotes
- This should be the kitchen sink. Yeah, plain and simple. What is left now is getting really, really small, and of what is left, a good chunk is getting delivered through Q3 and Q4, and the rest will get delivered next year.
- In a year's period, probably INR 10,000 crore worth of projects that we said no to or bid at a price that we think we can make money, and it did not happen. That said, we know what we are good at.
- I expect that in the second half of the year, we will report something that is north of 500 [trillion BTU] in TBWES. Q3, it was just below our reporting threshold, but we had a large international order from a Middle East customer for boilers for an upstream oil and gas customer, which is a very prestigious account, and it is a big breakthrough for us to enter one of the marquee names in the Middle East.
Research modules