Servotech Renewable Power System Limited has announced its financial results for the quarter and year ended March 31, 2026. The company reported a standalone revenue of ₹212.2 crore for Q4 FY26, a year-on-year increase of 76 percent. Standalone EBITDA stood at ₹23.2 crore, also up 76 percent year-on-year, and standalone Profit After Tax (PAT) was ₹11.7 crore, a 49 percent increase. On a consolidated basis, Q4 revenue was ₹219 crore, up 49 percent year-on-year, with consolidated EBITDA at ₹24.2 crore, an 81 percent increase year-on-year. The company highlighted that the strength in performance was particularly notable in the second half of the fiscal year. For the full year FY26, standalone revenue from operations reached ₹637 crore, an increase of 8.4 percent year-on-year. Operating EBITDA grew by 26.5 percent to ₹74.2 crore, with EBITDA margins expanding to 11.6 percent, the highest in the company's listed history. Standalone PAT was ₹36.3 crore, an 8.3 percent increase. The company attributed the PAT growth lagging EBITDA growth to the commissioning of ₹64 crore of new manufacturing capacity during the year, leading to higher depreciation and finance costs. Consolidated revenue for FY26 was ₹674 crore, broadly flat compared to FY25. Consolidated EBITDA grew by 22 percent to ₹71 crore, and consolidated PAT attributable to shareholders was ₹33.5 crore. The flat consolidated revenue was explained by a deliberate scale-down of low-margin trading activities in its medical equipment subsidiary, Rebreathe Medical Device, whose revenue decreased from ₹98 crore in FY25 to ₹32 crore in FY26. Excluding this subsidiary's effect, consolidated revenue grew approximately 12 percent year-on-year. The company has invested ₹64 crore in capacity building, including new manufacturing lines for solar hybrid inverters, grid-tied models, battery energy storage systems, and lithium-ion battery packs. Total CapEx for the year was ₹64 crore, and future CapEx is expected to moderate, funded by internal accruals. Servotech's product mix has shifted towards solar inverters and higher capacity DC chargers, contributing to a structural margin expansion of 200 basis points. The retail channel has seen significant growth, moving from ₹2 crore per month in FY22 to approximately ₹25 crore per month currently. The company is also strengthening its EPC and project execution capabilities, particularly in government projects like EV charging tenders and railway projects. Regarding the balance sheet, standalone borrowing increased from ₹75 crore to ₹196 crore, and trade receivables rose from ₹155 crore to ₹243 crore, resulting in negative operating cash flow for the year. These movements are attributed to CapEx, asset purchases, and delays in payments from oil marketing companies and railway projects. The company expects normalization in FY27 with a focus on restoring positive operating cash flow, reducing gearing, and bringing receivable collection to industry-typical levels. Key financial ratios for FY26 on a standalone basis include an Operating EBITDA margin of 11.6 percent, interest coverage of 6.2 times, Debt to Equity of 0.74 times, Net debt to EBITDA of 1.88 times, Current ratio of 1.5 times, and Return on Equity of 14.7 percent. Earnings Per Share (EPS) was ₹1.61, an 8 percent year-on-year growth. The company's credit rating from Infomerics remains BBB+ with a stable outlook. Looking ahead to FY27, Servotech plans for operational consolidation with no fresh long-term debt and significantly moderated CapEx. The focus will be on operating leverage, working capital normalization, and disciplined capital allocation. The company expects to sustain or modestly improve its margin expansion.
