Denta Water and Infra Solutions: Q2 & H1 FY26 Performance Review

Denta Water and Infra Solutions Limited, a prominent player in India's water infrastructure sector, has reported a robust operational and financial performance for the second quarter and first half of the financial year 2026, ending September 30, 2025. The company's results underscore its sustained growth trajectory, driven by accelerated project execution and strategic diversification. For Q2 FY26, Denta clocked a revenue of ₹74.27 crore, marking an impressive 53.8% year-on-year growth. The first half of FY26 saw the company achieve a total revenue of ₹141.55 crore. This strong top-line performance was complemented by healthy profitability, with an EBITDA of ₹26.31 crore and a PAT of ₹18.93 crore for the quarter, reflecting continued cost efficiency and execution excellence.

The company's core focus on sustainable and high-impact water management projects continues to be a significant revenue driver. Denta specializes in groundwater recharging and wastewater reuse projects, aligning with national priorities. Beyond its traditional strongholds, Denta has strategically diversified into allied infrastructure domains, including civil construction projects in the railway and highway sectors. This move is part of a broader strategy to expand its footprint across new geographies such as Maharashtra, Uttar Pradesh, Haryana, Gujarat, and Madhya Pradesh, leveraging its technical expertise to tap into a wider market. The management emphasized that its projects, largely government-funded under schemes like Jal Jeevan Mission and AMRUT, benefit from timely payment releases, ensuring a healthy cash flow and mitigating working capital requirements.

Financial Highlights

Here's a snapshot of Denta's key financial metrics for Q2 and H1 FY26:

Strategic Expansion and Operational Excellence

Denta's strategic initiatives are clearly geared towards sustainable growth and market leadership. The company's Design-Build-Operate-Transfer (DBOT) model is a testament to this, ensuring predictable revenue streams over three to five years, with 7%-8% of the contract value attributed to long-term operation and maintenance. This model, combined with a high tender winning success rate of approximately 75%, positions Denta favorably in a competitive landscape. The company's order book currently stands at a robust ₹734.74 crore, providing strong earning visibility for the next 2 to 2.5 years. Furthermore, Denta has an impressive order pipeline of approximately ₹750 crore, with a clear guideline to achieve ₹1,000 crore in order inflow for FY26. This robust pipeline, comprising centrally and state-sponsored tenders, strategically positions the company for sustained revenue visibility and geographic expansion.

Management highlighted its debt-free, asset-light business model as a key strength, supported by healthy equity-based and robust liquidity reserves. The company primarily utilizes internal generation funds and IPO funds for its projects, ensuring financial comfort and stability. This disciplined approach to capital allocation allows Denta to maintain high operating margins and drive overall growth at the bottom line. The work-in-progress and unbilled revenue, along with improved bills receivables, stood at ₹184.91 crore, further supported by a healthy cash and bank balance of ₹84.80 crore.

Future Outlook and Investor Confidence

Looking ahead, Denta's management provided optimistic guidance, projecting continued growth in revenue and profitability. The company aims to cross ₹300 crore in revenue for FY26. For FY27, revenue is expected to increase by 30%, translating to ₹375-400 crore, with a further 25-30% increase anticipated for FY28, reaching ₹500-525 crore. The order book is conservatively expected to exceed ₹1,000 crore by March 2026. Management also expressed confidence in maintaining EBITDA margins around 30% and PAT margins around 25%, attributing this to their efficient execution, economical procurement, and depth-light model. Operating cash flow is also expected to improve significantly in Q4 FY26.

The company's commitment to water sustainability and groundwater recharging, coupled with its expansion into new infrastructure segments and geographies, reinforces its long-term growth potential. Denta's strong financial health, strategic vision, and experienced management team instill confidence in its ability to capitalize on India's expanding water infrastructure agenda. The management expressed gratitude for investor faith, encouraging continued support as the company strives for better results and further order acquisitions, contributing to wealth creation and societal well-being through sustainable water solutions.