Refex Industries Q1 FY26 Results (NSE: REFEX)
Signal: Margin expansion
The read
Q1FY26 consolidated revenue hit an all-time high of ₹916 Cr (+160% YoY) as Windpower segment added ₹297 Cr of revenue (absent last year), while the core Ash & Coal business grew 76% YoY. Consolidated EBITDA margin expanded 190bps YoY to 11.0% — the 3rd consecutive quarter of YoY margin expansion (Q3, Q4, Q1) — driven by operating leverage (employee cost +1.1% vs revenue +160%). However, PAT from continuing ops of ₹74.53 Cr was 30% lower than Q4's ₹105.98 Cr, partly seasonal (Q4 typically has higher government road project activity). Key concern: EPS growth (132%) lagged PAT growth (155%) due to share dilution, and the EPS lag is flagged in cross_checks. The Green Mobility subsidiary continued to burn cash (loss -₹13.61 Cr), classified as discontinued operations pending NCLT approval for demerger.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹916.31 Cr | 160.4% | -1.9% |
| EBIT | ₹100.55 Cr | 176.1% | |
| Net profit | ₹74.53 Cr | 155.1% | |
| EPS | ₹5.38 | 131.9% | |
| EBIT margin | 11.0% |
P&L walk
Consolidated revenue surged 160% YoY to ₹916.31 Cr, driven by the Windpower segment (₹297.05 Cr, up from ₹0.76 Cr) and Ash & Coal (₹610.50 Cr, +76%). EBITDA margin expanded 190bps YoY to 11.0% despite a sharp QoQ contraction of 560bps from 16.6% in Q4FY26, as lower-margin Windpower revenue (which was absent in Q1FY25) now constitutes 32% of revenue. Employee costs grew only 1.1% vs revenue +160%, providing operating leverage. Finance cost grew 109% but as % of revenue dropped 30bps. PAT from continuing ops ₹74.53 Cr (+155% YoY) slightly lagged EBITDA growth due to higher tax (₹26.02 Cr vs ₹7.20 Cr). EPS ₹5.38 (+132% YoY) lagged PAT growth of 155% due to dilution from warrant conversions and ESOP allotments (equity base +6.1% yoy).
Segments
Ash & Coal Handling remains the profit engine (PBIT ₹111.47 Cr, +173% YoY), contributing 129% of group EBIT before other segments. Windpower revenue exploded to ₹297.05 Cr (from negligible) but segment PBIT was near break-even (-₹0.34 Cr), indicating start-up costs or low-margin PPA revenue. Green mobility loss widened 58% to -₹13.61 Cr, dragging group profit — this segment is classified under discontinued operations per the amalgamation scheme, suggesting management intends to hive it off.
Key positives
- Consolidated revenue ₹916 Cr (+160% YoY) — highest ever quarterly revenue
- Ash & Coal Handling segment PBIT ₹111.47 Cr (+173% YoY), margin 18.3%
- Employee cost grew only 1.1% vs revenue +160%, driving operating leverage
- 3rd consecutive quarter of consolidated EBITDA margin YoY expansion
- Windpower segment added ₹297 Cr revenue from near-zero base
Key concerns
- Green Mobility subsidiary loss widened to ₹13.61 Cr, a cash drain
- EPS growth (132%) lags PAT growth (155%) by 23pp — dilution from ESOP/warrant equity base expansion
- Consolidated OPM dropped 560bps QoQ from 16.6% to 11.0%, though partly mix-related (Windpower inclusion)
- Finance cost surged 109% YoY, indicating higher debt to fund wind & mobility capex
Research and educational content only. Not investment advice.