Shakti Pumps Q3 FY26 Earnings Call Transcript Released

Shakti Pumps (India) Limited has released the transcript of its earnings call held on Saturday, February 14, 2026, pertaining to the unaudited financial results for the quarter and nine months ended December 31, 2025.

During the Q3 FY26 earnings call, the management acknowledged that the reported financial performance was below expectations. This was attributed to a conscious moderation of execution, particularly in Maharashtra, to address elevated receivable levels and strengthen the balance sheet. Approximately ₹200 crores worth of orders were temporarily paused, impacting revenue recognition and margins. Factors affecting margins included lower realizations from Magel Tyala orders (around 4%), increased raw material prices (copper, steel, solar panels by ~2%), higher employee costs, and the consumption of higher-cost inventory from Q2 FY26. A one-time manpower cost of ₹4.4 crores due to new Labor Codes and investments in emerging businesses also impacted profitability.

The company highlighted that its working capital position has started to stabilize, with trade receivables remaining broadly stable compared to Q2 FY26. The order book stands at approximately ₹2,100 crores, with payments from Maharashtra showing improvement following fund releases from AIIB and the state government, leading to the resumption of execution. The company has expanded into Karnataka with its first large order. The export business remained resilient, with the retail segment reporting 25% YoY growth, and revenue from exports stood at ₹307 crores in 9M FY26 and ₹105 crores in Q3 FY26. Projections indicate healthy growth for the export segment, supported by trade agreements with the USA and Europe.

Emerging businesses are also showing traction, with cash sales growing by 68% YoY to ₹66.6 crores in 9MFY26. The solar rooftop business is expanding its dealer network, with a 500-megawatt DCR module capacity expected in Q1 FY27. The company anticipates Q4 FY26 to be its highest revenue quarter ever, aiming to achieve its full-year revenue guidance. The management emphasized a continued focus on strengthening the balance sheet, disciplined execution, and sustainable growth.

Developments in new businesses include pump expansion expected to start trial runs by August 2026. A 0.5-gigawatt module capacity is slated for commissioning in Q1 FY27, with 2.2-gigawatt cell plus module capacity expected by April 2027. For Shakti EV, sales are anticipated within the next year, with motor and controller development and testing completed, and approvals obtained from other companies.

Regarding margins, the management clarified that the dip in Q3 was due to a product mix favoring lower HP pumps in Maharashtra and increased raw material prices. They expressed confidence in improving margins in coming quarters as the sales mix shifts towards higher HP pumps and exports, and as execution scales up. The company aims to return to 20%+ margins. While acknowledging the volatility in raw material prices, they are focused on improving margins through better execution and product mix. Working capital is expected to improve as government payments are released, with significant funding support from the Maharashtra government and AIIB anticipated in the next 15 days to one month.

The company remains confident about the PM KUSUM scheme, noting increased budget allocations for KUSUM and PM Surya Ghar. They also highlighted strong traction in their direct cash business, driven by farmer demand. The company is also planning for a revenue of ₹5,000 crores by FY28, supported by capex, backward integration, diversification, and export market expansion.