Mumbai: India’s core sector companies — spanning engineering, infrastructure, and materials — are entering the second half of FY26 with record order backlogs, stronger balance sheets, and expanding margins. The Q2 performance of Elecon Engineering, Enviro Infra, AGI Greenpac, Deepak Fertilisers, and Allied Blenders & Distillers reflects steady execution despite challenges such as raw material volatility and project phasing delays.
Elecon Engineering: Heavy Orders, Healthy Margins
Elecon Engineering posted Q2 revenue of ₹578 crore (+14% YoY) and PAT of ₹88 crore (15% margin). Order inflows surged 28% YoY to ₹688 crore, pushing the total backlog to ₹1,226 crore.
The gear division contributed 76% of sales, benefiting from the continued recovery in power and mining demand, while the MHE division saw revenues rise 33%, driven by robust aftermarket demand.
Exports are emerging as the next major growth lever — H1 overseas revenue stood at ₹162 crore, with management targeting a 50% revenue share from global markets by FY30.
Armed with ₹600 crore in net cash and ₹995 crore in liquid investments, Elecon plans to fund its ₹400 crore capex through FY28 internally.
Enviro Infra: Wastewater & Renewables as Twin Growth Engines
Enviro Infra maintained strong profitability, reporting Q2 revenue of ₹228 crore (+6.7% YoY) and an impressive EBITDA margin of 28.6%. The company’s order book exceeds ₹2,000 crore, with 70% coming from wastewater projects, providing multi-year visibility.
FY26 guidance indicates 35–40% revenue growth and ₹2,500 crore in fresh inflows, backed by a robust bid pipeline exceeding ₹8,000 crore.
The firm’s renewable energy foray — with 69 MW capacity across Odisha and Maharashtra — is expected to contribute ₹200 crore in topline by FY26, generating 18–20% margins.
While working capital normalization and internal control gaps remain areas of focus, Enviro Infra expects to stay cash-positive, aided by improving debtor days and lower collateral ratios.
Deepak Fertilisers: Specialty Portfolio Cushions Commodity Volatility
Deepak Fertilisers reported ₹3,006 crore in revenue (+9% YoY) and ₹464 crore in EBITDA (flat YoY), though margins compressed to 15% due to weakness in IPA and ammonia segments.
The company’s shift toward specialty solutions, which now contribute 22% of total revenue, is helping mitigate commodity cyclicality.
With ₹870 crore capex in H1 and two key plants — Gopalpur TAN and Dahej Nitric Acid — nearing completion, management expects margin recovery and higher asset turns by FY27.
A turnaround in ammonia and a seasonal uptick in Rabi demand are expected to lend near-term support.
AGI Greenpac: Capex-Driven Expansion and Margin Upside
AGI Greenpac continued its steady momentum, posting Q2 revenue of ₹602 crore with an EBITDA margin improvement of 250 bps QoQ to 24.9%.
Operational efficiency, a premium glass product mix, and near-95% capacity utilization underpinned earnings growth.
The company is executing a ₹2,000 crore capex plan through FY28, adding 500 TPD capacity in Gwalior and setting up a 950 million-can aluminum packaging plant in Uttar Pradesh.
Debt levels have fallen sharply to ₹233 crore, with management targeting a debt-free status by FY26-end.
Over the next two years, AGI expects 8–10% topline growth alongside 100–200 bps margin expansion, driven by premiumization and efficiency gains.
Allied Blenders & Distillers: Premium Play Drives Profitability
In the alco-bev segment, Allied Blenders & Distillers (ABD) reported Q1 revenue of ₹995 crore (+14% YoY) with a 13.1% EBITDA margin.
The Premium & Above (P&A) segment rose to 47% of total sales, led by the doubling of ICONiQ whisky volumes.
Exports now account for 8% of revenue, with a target to reach 12–15% over the next two years across 35 international markets.
ABD is investing ₹527 crore in capacity and brand expansion, including PET and ENA units, and a Single Malt facility slated for FY27 launch.
Its luxury label “Maestro”, introduced in FY25, is scaling rapidly across 2,000+ premium outlets and travel retail channels.
Margins are expected to improve further through premium product mix, PET cost efficiencies, and stable input prices.
Sector Outlook: Strong Backlogs and Capex to Drive H2 Momentum
Across India’s industrial and infrastructure landscape, a clear pattern is emerging — volume recovery and robust backlog execution are offsetting input cost headwinds.
Most management commentaries point to a H2-weighted revenue trajectory, signaling a sequential uptick led by project deliveries, capex commissioning, and specialty product launches.
With debt-light balance sheets, export diversification, and operational efficiency at the forefront, India’s leading engineering and manufacturing firms are well-positioned to outperform peers in the next phase of the capex cycle.
