Axis Securities Retains BUY Rating Following Q2 Results

Revenue: Rs 1,384 Cr | Order Book: Rs 10,066 Cr

Reader Takeaway: Strong order book provides revenue visibility, but capacity expansion delays and export shipment deferrals dampen near-term earnings outlook.

What just happened

Axis Securities has maintained its 'BUY' rating on the company following the release of Q2FY27 results. However, the brokerage revised its target price from Rs 605 to Rs 570. The company reported consolidated net sales of Rs 1,384 crore, marking a 10% YoY increase, while EBITDA rose 11% YoY to Rs 145 crore. PAT stood at Rs 58 crore, reflecting a marginal 1% YoY decline.

Why this matters

The company’s order book has reached a record Rs 10,066 crore, effectively clearing its full-year target. Despite this, headwinds remain. Management highlighted a delay in the 75,000 MTPA brownfield expansion, now pushed to Q3/Q4 FY27. Additionally, export revenue dropped 46% YoY to Rs 106 crore due to customer-led shipment deferrals, impacting short-term margin profiles.

Change in estimates

Reflecting the current operational hurdles and rising input costs, Axis Securities has reduced its earnings projections. FY27 EBITDA estimates have been trimmed by 9%, and attributable net profit forecasts have been lowered by 16%. FY28 projections also saw a downward revision of 5% in net profit estimates.

Risks to watch

Investors should monitor the timeline for the 75,000 MTPA capacity commissioning, as further delays could hinder volume growth. The pace of export order execution—particularly in North America, Australia, and Africa—is critical for the company to achieve its long-term EBITDA margin goal of 12%.

Context metrics

The company successfully reduced gross debt, including interest-bearing acceptances, by Rs 302 crore since March 2026, bringing total debt to Rs 964 crore. Finance costs have improved to 3.2% of revenue.