Netweb Technologies: Powering India's AI Ambition with Record Orders and Robust Growth

Netweb Technologies India Limited, a leading player in high-end computing solutions, has reported an exceptional performance for Q2 FY26, underscoring its pivotal role in India's burgeoning digital infrastructure. The company's unaudited standalone financial results reveal a robust growth trajectory, with operating income soaring by 21% year-on-year to INR 303.72 crore. Profit After Tax (PAT) also saw a significant jump of 20.1% year-on-year, reaching INR 31.43 crore, reflecting strong demand and disciplined execution.

This quarter's highlight is undoubtedly the securing of two large strategic orders valued at approximately INR 2,184 crore, slated for execution by FY27. This monumental achievement not only reaffirms Netweb's position as India's largest OEM in high-end computing solutions but also signals a strong pipeline for future revenue. The company's H1 FY26 performance further solidifies this trend, with operating income growing by 51.1% year-on-year to INR 604.94 crore and PAT increasing by 49.5% to INR 61.91 crore, demonstrating consistent outperformance against its stated growth guidance.

Strategic Pillars and Segmental Performance

Netweb's business is built on three core growth pillars: High-Performance Computing (HPC), Private Cloud, and AI Systems. The AI segment, in particular, has emerged as a powerhouse, with its revenue contribution rising impressively by 160.7% year-on-year in H1 FY26, now accounting for 25.4% of the total revenue. This growth is fueled by the 'Make AI in India' initiative and the government's significant outlay for the IndiaAI Mission, aiming to establish a sovereign AI ecosystem.

For H1 FY26, the revenue breakdown by offerings highlights the diversified nature of Netweb's business:

This balanced portfolio, with HPC and Private Cloud still contributing over 60% of the business, provides stability while the AI segment drives accelerated growth. The company's strategic OEM partnership with NVIDIA, along with its in-house design and manufacturing capabilities, ensures access to the latest technologies and streamlined supplies, even amidst global chip shortages.

Financial Health and Operational Efficiency

Netweb Technologies maintains a strong financial position, characterized by a zero net debt status and net free cash of INR 237.98 crore as of September 2025. This robust liquidity provides a solid foundation for executing its ambitious growth plans without relying on external capital for major projects. The company's return on equity (ROE) for H1 FY26 stood at 22.4%, and return on capital employed (ROCE) at 30.2%, reflecting efficient capital utilization.

While the cash conversion cycle increased slightly to 120 days, primarily due to a reduction in payable days, the management emphasized that advances received for large strategic orders have not been adjusted in receivable days, indicating a conservative approach to reporting. The company's commitment to in-house design and manufacturing, coupled with its focus on high-end, purpose-built solutions, allows it to maintain healthy and sustainable margins, even for large strategic orders.

Outlook and Strategic Vision

Looking ahead, Netweb Technologies is optimistic about its sustained growth trajectory. The management reiterated its guidance of 35-40% organic growth for its regular business for the next couple of years and expects to maintain a growth rate of 30-35% for at least three years. EBITDA margins are projected to remain in the 13-14% range. The company's pipeline of around INR 4,000 crore for organic business, excluding strategic orders, provides strong revenue visibility.

Netweb is actively expanding its product portfolio with innovations like AI native appliances using Skylus.ai, unified data storage platforms, and on-premise AI Sovereign cloud solutions. The company is also exploring international expansion into Europe and the Middle East, planning to establish a service network in four countries. By delivering world-class AI infrastructure designed, engineered, and manufactured in India, Netweb is not just growing its business; it is playing a crucial role in accelerating India's emergence as a global AI powerhouse and an 'AI factory of the world'.