Pace Digitek Powers Up: Strong Order Book and Energy Transition Drive H1 FY26 Performance

Pace Digitek Limited, a key player in India's digital and energy transition, has unveiled its Q2 and H1 FY26 financial results, showcasing a period of strategic reorientation and robust growth momentum. Headquartered in Bengaluru, the technology and engineering enterprise, established in 2007, has evolved into a diversified infrastructure solutions provider with integrated capabilities spanning manufacturing, EPC (Engineering, Procurement, and Construction), and O&M (Operations & Maintenance) across telecom infrastructure and renewable energy storage.

For the first half of fiscal year 2026 (H1 FY26), Pace Digitek reported a consolidated total revenue of INR 900.53 crore, with a Profit After Tax (PAT) of INR 122.56 crore, translating to a healthy PAT margin of 13.61%. While the H1 turnover experienced a dip compared to the previous year, management attributed this to a strategic shift in business mix, moving from heavy material supplies to a more service-oriented focus. The second quarter (Q2 FY26) demonstrated strong sequential recovery, with revenue from operations surging by 45% quarter-on-quarter to INR 533.45 crore. Profit Before Tax (PBT) also saw a significant 29% Q-o-Q increase to INR 95.58 crore, and PAT grew by 24% Q-o-Q to INR 67.86 crore, reflecting a strong PAT margin of 12.72% for the quarter. This performance underscores the company's ability to adapt and capitalize on emerging opportunities, particularly in the burgeoning energy sector.

Financial Highlights: A Snapshot of Performance

The company's financial summary for H1 FY26, on a consolidated basis, illustrates a solid foundation and promising trajectory:

Note: All figures are consolidated and in INR Crore. Q2 FY26 refers to the quarter ended September 30, 2025, and H1 FY26 refers to the half year ended September 30, 2025.

Strategic Thrust: Energy and Telecom Synergy

Pace Digitek's core business verticals include Telecom Infrastructure, Energy Solutions, and ICT Solutions. The company's unique synergy between telecom and energy, with a strong focus on Battery Energy Storage Systems (BESS) and renewables, is a key differentiator. This strategic alignment positions Pace Digitek to capitalize on India's ambitious Digital India, National Infrastructure Pipeline, and Renewable Energy Mission initiatives.

For FY26, the company projects an operational revenue of INR 2,600-2,700 crore, with PAT margins improving to 12%. The energy segment is expected to contribute INR 500-550 crore, while ICT solutions are targeted at INR 250 crore, with the remaining substantial portion from telecom. Looking ahead to FY27, Pace Digitek aims for a topline of INR 3,100-3,200 crore, maintaining PAT margins at 11-12%. The contribution from the energy segment is anticipated to increase multi-fold in FY27, with the developer model for energy projects expected to generate an EBITDA of INR 120 crore.

Expanding Capabilities and Order Book Strength

A significant highlight of the quarter is the substantial strengthening of Pace Digitek's order book. The company secured new orders worth INR 1,345.18 crore in Q2 FY26 alone. This includes a landmark INR 1,159.31 crore contract from Solar Energy Corporation of India (SECI) for the deployment of a 600 MW / 1200 MWh BESS project, one of India's largest single-location BESS installations. Additionally, an INR 185.87 crore Operations & Maintenance (O&M) contract from Tata Teleservices for telecom infrastructure services across five South Indian states further bolsters their service portfolio. The total order book now stands at INR 9,135 crore, providing multi-year revenue visibility and demonstrating consistent demand across both energy and telecom segments.

To support this growth, Pace Digitek is doubling its BESS containerized manufacturing capacity from 5 GWh to 10 GWh. This expansion, coupled with backward integration through a new container fabrication unit, aims to optimize costs, improve product design control, and enhance competitiveness under the 'Make in India' policy. The company also commissioned its first BESS site for MSEDCL in Maharashtra, a 20 MWh project, on September 26, 2025, marking a significant operational milestone.

Navigating Challenges and Future Outlook

While the outlook is largely positive, management transparently addressed certain aspects. The net working capital is currently stretched, a characteristic of the EPC business model, but is expected to normalize by March 2026 as projects reach completion and retention money is released. The BESS market, though high in demand, is witnessing increased competition and aggressive bidding, which could impact margins. However, Pace Digitek's integrated manufacturing and backward integration provide a cost advantage, helping to mitigate these pressures.

Overall, Pace Digitek Limited is strategically positioned to leverage India's infrastructure transformation. With a strong order book, expanding manufacturing capabilities, and a clear focus on high-growth segments like BESS and renewables, the company is poised for sustained growth and aims to be a preferred partner in the nation's digital and energy transition journey. The management's confident growth trajectory and disciplined execution underscore its commitment to long-term value creation for stakeholders.