Azad Engineering Reports 60% Net Profit Growth in Q2 FY26, Driven by Strong Segment Performance and New Orders

Azad Engineering Ltd. has reported robust financial results for the second quarter of fiscal year 2026 (Q2 FY26). The company's net profit saw a substantial surge of 60%, climbing to ₹33 crore from ₹20.5 crore in the corresponding quarter of the previous year. This significant profit growth was accompanied by a healthy revenue increase of 30.6%, bringing the total to ₹145.6 crore, up from ₹111.5 crore. Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) also showed strong upward momentum, increasing by 32.1% to ₹53.2 crore, with the EBITDA margin slightly improving to 36.5% from 36.1% a year ago.

In the first half of FY26 (H1 FY26), the Energy & Oil & Gas segment emerged as a major growth driver, contributing ₹226.1 crore and marking a 35.7% increase over H1 FY25. This performance is attributed to expanded capacity. The Aerospace & Defence segment also demonstrated strong progress, generating ₹47.1 crore, a 30.3% rise, driven by the commercialization of new products. Exports accounted for ₹260.4 crore in H1 FY26, representing 34% of the revenue mix.

Chairman & CEO Rakesh Chopdar highlighted the company's strategic alignment with global Original Equipment Manufacturers (OEMs) and its ability to scale operations effectively. He noted the success of customer-specific plants in the Energy and Oil & Gas sector, as well as advancements in the Aerospace & Defence segment. Furthermore, the company's order book has been significantly strengthened by the signing of Phase 2 of a contract with Mitsubishi Heavy Industries, valued at ₹13,870 million (approximately ₹1387 crore). With this strong order backlog and strategic expansion plans, Azad Engineering remains confident in achieving its projected topline growth of 25% to 30% for the full fiscal year.

Impact: This news is highly relevant for Indian stock market investors as it signals strong operational performance, prudent financial management, and a promising future growth trajectory for Azad Engineering. The company's ability to secure large contracts and grow key segments indicates strong market positioning and execution capabilities, which can lead to sustained shareholder value creation. The detailed financial metrics and forward-looking statements provide investors with confidence in the company's prospects. Impact rating: 7/10

Difficult Terms: * **OEM (Original Equipment Manufacturer)**: A company that manufactures products based on designs supplied by another company, often for branding by that other company. * **EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization)**: A measure of a company's operating performance, showing profitability before accounting for certain expenses like interest, taxes, depreciation, and amortization. * **EBITDA Margin**: Calculated by dividing EBITDA by total revenue and multiplying by 100, it represents the percentage of revenue that remains after deducting operating expenses before accounting for interest, taxes, depreciation, and amortization. It's an indicator of operational profitability. * **Topline Growth**: Refers to the increase in a company's gross revenue or sales over a specific period, indicating the growth of its primary business operations.