Enviro Infra Engineers: Strong Q2 and H1 FY26 Performance Driven by Execution and Strategic Expansion

Enviro Infra Engineers Limited, a key player in India's water and wastewater management sector, has reported a robust financial performance for the second quarter and first half of fiscal year 2026. The company's managing director, Mr. Manish Jain, highlighted a period of resilient performance, consistent execution, and strategic progress across its core business segments. Despite a seasonally moderated pace of process billing, the company maintained healthy profitability and robust operational momentum, supported by strong order inflows and disciplined execution.

For Q2 FY26, the company's revenue from operations stood at INR 227.3 crore, marking a 6.7% year-on-year growth. This growth was primarily driven by sustained traction in its key water and wastewater treatment projects. EBITDA for the quarter reached INR 65 crore, reflecting a significant 16.8% increase compared to Q2 FY25, with a healthy EBITDA margin of 28.56%. Profit After Tax (PAT) surged by 36.1% year-on-year to INR 49.5 crore, underscoring the company's disciplined execution and cost efficiency, resulting in a strong PAT margin of 20.51%.

The first half of FY26 also demonstrated strong growth, with revenues reaching INR 468.3 crore, a 12% increase over the same period last year. EBITDA for H1 stood at INR 129.2 crore, growing 20.8% year-on-year, and the EBITDA margin expanded by over 200 basis points to 27.58%. PAT for H1 FY26 was INR 92 crore, up 38.6% year-on-year, with the PAT margin growing by 330 basis points to 18.75%. This performance sets a strong tone for the remainder of the year, supported by a healthy order book, expanding technology footprint, and a clear path for profitable and sustainable growth.

Segmental Performance and Strategic Initiatives

The company's revenue bifurcation highlights its core focus areas. For Q2 FY26, Water and Wastewater Treatment Plants (WWTPS) contributed INR 156.2 crore (68.7% of revenue), followed by Water Supply Scheme Projects (WWSP) at INR 50.3 crore (22.1%). Operations & Maintenance (O&M) brought in INR 12.4 crore (5.4%), while Renewables Revenue and Annuity contributed INR 1.7 crore (0.7%) and INR 6.7 crore (3.0%), respectively. This product mix, heavily weighted towards wastewater treatment, is contributing to better margin profiles.

Enviro Infra Engineers is actively pursuing several strategic initiatives to drive future growth. The company aims to expand its geographical presence across India, bid for more Hybrid Annuity Model (HAM) projects, and capitalize on government policy initiatives such as AMRUT 2.0 and Namami Gange Programme. A key strategy involves increasing the size of projects undertaken, targeting 50 to 200 MLD for STPs and 20 to 50 MLD for CETPs, to qualify for larger projects and earn better margins. Furthermore, the company is venturing into 'Waste to Energy' projects by installing solar power plants and Compressed Biogas (CBG) plants, contributing to renewable energy and reducing its carbon footprint.

Order Book and Financial Health

As of September 30, 2025, the total execution order book stands at over INR 1,800 crore, with an O&M portfolio of INR 932 crore. A new order worth INR 248 crore from Bhopal Municipal Corporation was secured in October 2025, further strengthening the order book to over INR 2,000 crore. The company has submitted bids for projects estimated at over INR 8,000 crore, with results awaited, indicating a robust pipeline. Management is confident of exceeding its fresh order book guidance of INR 250 crore for FY26.

Despite a strong financial performance, the company reported a negative operating cash flow of approximately INR 100 crore for H1 FY26. This was primarily attributed to a temporary build-up in unbilled revenues during the monsoon season. However, the debtor cycle has significantly improved from 70 days to 49 days, indicating better collection efficiency. The company aims to achieve positive operating cash flow for the full financial year. An exceptional loss of INR 8.5 crore due to a fraud incident was also reported, which the company is working to resolve.

Outlook and Management Confidence

Enviro Infra Engineers Limited's management remains optimistic about its future prospects. The company maintains its guidance for a 35-40% year-on-year top-line growth and EBITDA margins in the 22-24% range. The renewable energy segment is projected to generate INR 20 crore in FY26, with an ambitious target of INR 50 crore by FY27, growing at 40-50% thereafter. The company's focus on in-house capabilities, advanced technologies, and strategic geographical expansion positions it well to capitalize on the growing opportunities in India's water and wastewater treatment sector.

Enviro Infra Engineers Limited is committed to building a cleaner, more sustainable future. The strong Q2 and H1 FY26 performance, coupled with a robust order book and clear strategic direction, underscores the company's disciplined execution and its dedication to sustainable growth.