Deep Industries Reports Q2FY27 Revenue Growth of 34 Per Cent, Maintains Buy Rating

Deep Industries posted a 34 percent year-on-year increase in revenue to ₹295 crore for Q2FY27, driven by contributions from new projects. The company maintained a revolving order-book of approximately ₹3,090 crore and guided for strong revenue and profit growth over the next two fiscal years.

Deep Industries has reported its financial and operational performance for the second quarter of fiscal year 2027, highlighting revenue growth supported by contributions from new projects.

During Q2FY27, the company's operating revenue grew by 34 per cent year-on-year to ₹295 crore, aligning with previous estimates. Gross profit for the quarter increased by 17 per cent to reach ₹144 crore. However, the gross profit margin contracted by 700 basis points to 48.7 per cent, which was primarily attributed to higher material and maintenance costs.

Earnings Before Interest, Taxes, Depreciation, and Amortisation (EBITDA) grew by 16 per cent to ₹110 crore, though this figure was 6.5 per cent lower than initial estimates. The EBITDA margin moderated by 543 basis points to 36 per cent, reflecting elevated operating expenditures alongside lower gross margins.

Despite executing contracts worth ₹295 crore during the quarter, Deep Industries sustained a revolving order-book of approximately ₹3,090 crore, providing medium-term revenue visibility. The company secured new order additions of ₹340 crore during Q2FY27, while its active bidding pipeline stands at ₹700 to ₹800 crore.

Looking ahead, company management has projected operating revenue growth of 30 to 35 per cent for FY27, with a similar growth trajectory anticipated for FY28. This outlook is anchored by the existing order-book and the current bidding pipeline. Furthermore, management has provided profit after tax (PAT) guidance of ₹350 to ₹370 crore for FY27, increasing to ₹470 to ₹500 crore for FY28.

Backed by the government's focus on energy security and favorable sector tailwinds, analysts maintain a constructive outlook on the company's long-term growth prospects, revising the target price to ₹805 based on a 13x price-to-earnings multiple for FY28 estimated earnings, while maintaining a 'Buy' rating.

"Deep Industries demonstrates how a robust order-book and consistent project execution can support steady financial performance even when margins face temporary compression due to rising operating costs. Their clear revenue guidance for the upcoming fiscal years highlights strong medium-term visibility, which is essential for scaling operations in the capital-intensive energy sector." — Dr. Shishir Gupta, Founder & CEO, StartupLanes