Pennar Industries Ltd-$ — Q1 FY27 earnings call
Summary generated by AI from the official transcript Pennar Industries Ltd-$ filed with BSE on 14 Aug 2026. Every statement cites a verbatim quote from that document — open any citation to read it. This is a record of what management said, not a recommendation. How we check these summaries
The short read
Pennar Industries reported Q1 FY27 revenue growth of 3.58% year-on-year to Rs 884.55 crores, while PBT grew 16.04% to Rs 46.8 crores. Management attributed the profitability improvement to a favorable business mix, with higher-margin segments like PEB U.S. and Engineering Services growing faster than legacy businesses. Order backlogs reached record highs in PEB India, PEB U.S. and the Boiler division, while Hydraulics and Tech Pennar were described as weaker areas during the quarter.
Numbers mentioned
Revenue: INR884.55 crores (Q1 FY27)
p. 3
“Revenue grew 3.58% year-on-year to INR884.55 crores, and PBT grew 16.04% to INR46.8 crores.”
Aditya Rao, page 3 of the filed PDF · View the filing
PBT: INR46.8 crores (Q1 FY27)
p. 3
“Revenue grew 3.58% year-on-year to INR884.55 crores, and PBT grew 16.04% to INR46.8 crores.”
Aditya Rao, page 3 of the filed PDF · View the filing
PEB India order book: INR1,008 crores
p. 3
“The order book now sits at INR1,008 crores, the highest we have ever carried.”
Aditya Rao, page 3 of the filed PDF · View the filing
PEB U.S. order backlog: USD 100 billion
p. 3
“We have now crossed USD 100 billion in order backlog.”
Aditya Rao, page 3 of the filed PDF · View the filing
Boiler order backlog: over INR150.75 crores
p. 4
“Boilers again highest ever order backlog in over INR150.75 crores.”
Aditya Rao, page 4 of the filed PDF · View the filing
PBT margin: 5.38% (Q1 FY27)
p. 4
“On profitability and margins, PBT margin was at 5.38%, up from 4.77% last year.”
Aditya Rao, page 4 of the filed PDF · View the filing
ROCE: around 20% (Q1 FY27)
p. 4
“And capital efficiency rose was around 20% and ROE around 12%.”
Aditya Rao, page 4 of the filed PDF · View the filing
ROE: around 12% (Q1 FY27)
p. 4
“And capital efficiency rose was around 20% and ROE around 12%.”
Aditya Rao, page 4 of the filed PDF · View the filing
Revenue from operations: INR870.4 crores (Q1 FY27)
p. 5
“the revenue from operations has increased from INR870.4 crores from INR845.7 crores, a growth of 2.9%.”
Shrikant Bhakkad, page 5 of the filed PDF · View the filing
EBITDA: INR106.8 crores (Q1 FY27)
p. 5
“EBITDA increased to INR106.8 crores from INR94.3 crores, representing a growth of 13.3% reflecting improved products and a project mix.”
Shrikant Bhakkad, page 5 of the filed PDF · View the filing
Customized design Building Solutions revenue: INR507 crores (Q1 FY27)
p. 5
“revenue from the business in the custom design building solution has gone from INR411 crores to INR507 crores and continues to be an important driver for our transformation journey.”
Shrikant Bhakkad, page 5 of the filed PDF · View the filing
Diversified engineering business sales: INR385 crores (Q1 FY27)
p. 5
“which we have exited over the years in terms of module mounting structures and Pennar which has decreased our sales from INR450 crores to INR385 crores.”
Shrikant Bhakkad, page 5 of the filed PDF · View the filing
Gross margin: 43.85% (Q1 FY27)
p. 5
“Gross margins have been expanded from 42.56% to 43.85% at a consolidated level, while the contribution margins has increased from 27.14% to 28.51%”
Shrikant Bhakkad, page 5 of the filed PDF · View the filing
Employee expenses: INR107.32 crores (Q1 FY27)
p. 6
“Employee expenses increased during the quarter from INR92.5 crores to INR107.32 crores, up by 16%.”
Shrikant Bhakkad, page 6 of the filed PDF · View the filing
Interest cost: approximately 4.18% (Q1 FY27)
p. 6
“Interest cost for the quarter stood at approximately 4.18% this quarter, slightly higher.”
Shrikant Bhakkad, page 6 of the filed PDF · View the filing
PAT margin: 4.07% (Q1 FY27)
p. 11
“In fact, for the quarter, we have just closed, I think our PAT margin would be 4.07%.”
Aditya Rao, page 11 of the filed PDF · View the filing
Engineering Services revenue: about INR70 crores per year
p. 21
“But from a revenue standpoint, I can tell you that it's about INR70 crores per year.”
Aditya Rao, page 21 of the filed PDF · View the filing
PEB India advance percentage: 25%
p. 22
“We have still instituted that and advance percentage has now gone down to 25%.”
Aditya Rao, page 22 of the filed PDF · View the filing
What management said it would do
A record of statements made on the call, in the words management used. Parakho does not forecast, endorse or assess them, and their presence here is not a view on whether they will happen.
PEB India and PEB U.S. margins — Q2
stated firmly by Aditya Rao
p. 7
“I would strongly suggest you see this as a momentary blip, we are extremely confident that operating margins move back to where they were for PEB India and for PEB U.S. from this quarter onwards.”
Aditya Rao, page 7 of the filed PDF · View the filing
PEB overall revenue growth — double-digit growth · Q2
stated firmly by Aditya Rao
p. 8
“I think PEB overall, as a component, you should expect to double-digit growth from last quarter to this quarter from last year to this year, every which you should see good growth in this quarter, Q2.”
Aditya Rao, page 8 of the filed PDF · View the filing
Combined entity revenue growth — double-digit rates · Q2
stated firmly by Aditya Rao
p. 8
“But be that as it may for Q2, I think with the higher levels of growth being achieved at multiple business units, we will be in a place to, the combined entity to grow at double-digit rates.”
Aditya Rao, page 8 of the filed PDF · View the filing
PBT margin — 7% · next 3 years
stated as an aspiration by Aditya Rao
p. 9
“What we have guided to is over the next 3 years, reaching a PBT of 7%.”
Aditya Rao, page 9 of the filed PDF · View the filing
Debt-to-equity ratio — around 0.7 · end of the year
stated firmly by Aditya Rao
p. 10
“We would consider any debt equity around 0.7 to be healthy. From an annualized point of view, by the end of the year, we are quite confident we will be able to get close to that number.”
Aditya Rao, page 10 of the filed PDF · View the filing
ROCE — 25%
stated firmly by Aditya Rao
p. 12
“So we commit to you that we are targeting 25% ROCE.”
Aditya Rao, page 12 of the filed PDF · View the filing
PAT growth — 20% · this year
stated firmly by Aditya Rao
p. 16
“Yes, that is our stated goal that we achieve these numbers.”
Aditya Rao, page 16 of the filed PDF · View the filing
Revenue growth (sequential) — double-digit growth · Q1 to Q2
stated firmly by Aditya Rao
p. 23
“Q1 to Q2, you should expect growth. Yes, you should expect double-digit growth in revenue and profitability.”
Aditya Rao, page 23 of the filed PDF · View the filing
Legacy business revenue realization
stated as an aspiration by Aditya Rao
p. 14
“So we have -- we are looking at what are the best ways to achieve that.”
Aditya Rao, page 14 of the filed PDF · View the filing
ROCE for FY27 — 25% to 30% · FY27
stated conditionally by Aditya Rao
p. 6
“ROCE for the year, I mean, our stated target is higher at around 30%, but we will definitely be over 20% for Q2, higher than that.”
Aditya Rao, page 6 of the filed PDF · View the filing
Q&A highlights
Management's answers to analyst questions, in Parakho's words rather than a transcript. Each row names who answered and carries the verbatim quote it was drawn from.
Management stated a stated target of around 30% but expects to be over 20% for Q2, with 25% as an average for the year.
Answered by Aditya Rao
Asked by Kanishk Gupta: What ROCE is expected for full year FY27 given the debt-to-equity target of 0.8?
p. 6
“ROCE for the year, I mean, our stated target is higher at around 30%, but we will definitely be over 20% for Q2, higher than that. For the year as an average, I think we said 25% that's at -- 25%, we can comment.”
Aditya Rao, page 6 of the filed PDF · View the filing
Management said most of the steel price pass-through was achieved but there was a temporary lag causing the margin bleed, expected to normalize from Q2.
Answered by Aditya Rao
Asked by Nitin Jain: Why did PEB EBIT margin drop more than 200 basis points versus peers who passed on steel price hikes?
p. 7
“We were able to get the vast majority of the pass-through steel price increase pass-through, that did happen. Some I think there was a little bit of a bleed effect where it took some pain for us to get those increases.”
Aditya Rao, page 7 of the filed PDF · View the filing
Management pointed to decline in legacy steel and railways businesses offsetting growth in PEB, boilers, BIW and Engineering Services.
Answered by Aditya Rao
Asked by Vidhi Shah: What is causing the revenue slowdown and what are growth drivers ahead?
p. 8
“We are having a fair amount of revenue decline in what we call the legacy businesses, which comprised of our steel business unit and the railways business unit.”
Aditya Rao, page 8 of the filed PDF · View the filing
Management said the data was not yet prepared for disclosure but committed to providing it next quarter.
Answered by Aditya Rao
Asked by Shubhankar Gupta: Can the company provide a segmental EBITDA breakup?
p. 9
“But do give us the quarter to present because, let me be honest, we have not prepared that data for dispersal yet.”
Aditya Rao, page 9 of the filed PDF · View the filing
Management said the timeframe for reaching specific percentages may shift due to commodity pricing effects, but the direction of consistent margin improvement has held.
Answered by Aditya Rao
Asked by Bhashit Parikh: Why do the company's margin targets keep shifting over the years?
p. 11
“Now if there is hysteresis or a little bit of, as you put it, goalpost moving in terms of when we achieve that, that is primarily because of what we see is a quarter-on-quarter impact in terms of higher commodity pricing, which tends to have a temporary effect.”
Aditya Rao, page 11 of the filed PDF · View the filing
Management attributed higher costs to the Telco acquisition and ramp-up of engineering manpower ahead of revenue, and said the market discount would resolve with consistent execution.
Answered by Aditya Rao
Asked by Nilesh Narendra Shah: Why are employee costs rising faster than profitability and is there a holding company discount concern?
p. 18
“Our salary costs are higher because we have undertaken an acquisition in telco. And as I mentioned, as we ramp up order backlog, we do also need to ramp up engineering manpower, teams, production staff level.”
Aditya Rao, page 18 of the filed PDF · View the filing
Management said some productivity gains from automation are expected but the entirety of the work cannot be automated, and the business grew 26% last quarter.
Answered by Aditya Rao
Asked by Venkatasubramanian Raman: Is the Engineering Services business at risk of disruption from AI?
p. 21
“So, the -- we believe that some improvement in terms of productivity is what it will be up to about 30%, 35% is what we mapped out.”
Aditya Rao, page 21 of the filed PDF · View the filing
Management acknowledged growth was around 16-17% versus peers' higher rates but attributed the gap to legacy business drag and said execution improvements were underway.
Answered by Aditya Rao
Asked by Deepak Poddar: How does PEB India/U.S. growth compare with peers who grew 20-25%?
p. 23
“We're not at 25%. But if you -- if the legacy business reduction, if that is accounted for, then we are -- I mean, around those levels. It's not 25%, but I think I believe it's 16% or 17%.”
Aditya Rao, page 23 of the filed PDF · View the filing
Risks flagged
Tariff uncertainty in the U.S. affecting Hydraulics order bookings
p. 4
“Hydraulics, our order backlog is at INR30 crores activity in the U.S. has slowed, to Europe has done well the introduction of some tariffs, uncertainty, even though it's the Senate and not the house, the expectation that something may come in is causing order backlog to order bookings to run a little lower than we expect.”
Aditya Rao, page 4 of the filed PDF · View the filing
Weak order book and execution issues in Tech Pennar
p. 4
“Tech Pennar has been the weak spot. The order book was thin and a few execution flips cost at some customers.”
Aditya Rao, page 4 of the filed PDF · View the filing
Operational challenges in India PEB execution
p. 5
“Execution in PEB business was impacted by operational challenges.”
Shrikant Bhakkad, page 5 of the filed PDF · View the filing
Softer diversified engineering business due to lower steel and hydraulics activity
p. 5
“Our diversified engineering business experienced a softer quarter due to lower activity in steel and hydraulics.”
Shrikant Bhakkad, page 5 of the filed PDF · View the filing
Temporary margin bleed from delayed steel price pass-through
p. 7
“Some I think there was a little bit of a bleed effect where it took some pain for us to get those increases.”
Aditya Rao, page 7 of the filed PDF · View the filing
Decline in legacy steel and railways businesses
p. 8
“So both of those business units we're not deploying capital into those businesses.”
Aditya Rao, page 8 of the filed PDF · View the filing
Higher tax rate impact in the quarter from a tax adjustment
p. 12
“One other factor you want to take into account specific to this quarter is we had a higher tax rate because of 1 type somewhere in the last quarter, which we have tax adjustment relating to a clear which was INR1.75 crores.”
Aditya Rao, page 12 of the filed PDF · View the filing
Lack of clarity in Hydraulics addressable market due to geopolitical issue
p. 19
“Our Hydraulics is the one thing, as I mentioned, is this lack of clarity in our addressable market.”
Aditya Rao, page 19 of the filed PDF · View the filing
Generated by claude-sonnet-5. Source: the transcript as filed with BSE. We link to the exchange's copy; we do not host transcripts. Parakho is a data and screening tool, not an investment adviser — nothing here is a recommendation to buy, sell or hold.