Engineers India Hits Record ₹15,800 Cr Order Book on Overseas Surge

Introduction to EIL's Growth Phase

Engineers India Ltd. (EIL), a state-run engineering and design firm, is entering a significant growth phase, supported by a record-high order book and a strategic expansion into international markets. The company, which specializes in petroleum refineries, petrochemicals, and oil and gas processing, has seen its order book swell to an all-time high, providing strong revenue visibility for the medium term. This surge is largely attributed to a substantial increase in overseas projects, signaling a pivotal shift in the company's business dynamics and growth strategy.

The Nigerian Mega-Deal: A Global Milestone

The primary catalyst for this momentum is EIL's largest-ever overseas order, secured from Nigeria’s Dangote Group. Valued at approximately $160 million, the contract involves the expansion of a mega refinery project. EIL's role includes engineering, procurement, construction supervision, and project management to double the refinery's capacity. This landmark project, with an execution period of about three years, not only marks a key milestone in EIL's global journey but also ensures a steady stream of revenue. Vartika Shukla, Chairman and Managing Director of EIL, also noted that the company is executing additional projects at the same location worth around $10 million for a high-capacity urea unit. Management has highlighted that these are repeat orders, reflecting strong client confidence in EIL's technical expertise.

Shifting Dynamics: International Business Takes the Lead

International business has emerged as a powerful growth driver for Engineers India. In the current financial year, overseas markets have accounted for approximately 65% of fresh order inflows, a stark contrast to the 35% from domestic projects. This global push has expanded EIL's total order book to nearly ₹15,800 crore, with international projects now constituting about 40% of the total. This strategic diversification is expected to enhance both revenue and profitability in the coming years, balancing the company's dependence on domestic economic cycles.

Q2FY26 Financial Performance

In the second quarter of fiscal year 2026 (Q2FY26), Engineers India reported a strong operational performance. Revenue from operations saw a significant 34% year-on-year increase, rising to ₹921.3 crore from ₹689 crore in the same period last year. The company's EBITDA nearly doubled to ₹120 crore, with EBITDA margins expanding from 9% to 13%. However, the consolidated net profit saw a decline of 16.2%, falling to ₹83.5 crore from ₹99.63 crore in the year-ago period. This dip was primarily attributed to losses from joint ventures amounting to ₹26 crore. On a standalone basis, the company's performance was robust, with net profit increasing by 45%.

Key Financial Metrics Summary

Management Outlook and Profitability

The management of EIL remains confident about the company's future prospects. They have upgraded the revenue growth guidance for FY26 to exceed 25%, driven by the strong order book and enhanced execution capabilities. While the full impact of the large Nigerian order will be more visible from the next financial year, the current pipeline provides a solid foundation. Profitability is also expected to remain healthy. The company benefits from a favorable project mix, with the high-margin consultancy segment consistently delivering profitability of 25-28%. While Lump Sum Turnkey (LSTK) projects have lower margins, the increasing share of complex overseas projects is considered margin-accretive and is expected to support overall earnings.

Analyst Perspective and Market Reaction

Analysts have taken a positive view of EIL's operational strength and healthy order book. Antique Stock Broking, for instance, has maintained a 'Buy' rating on the stock, raising its target price to ₹251. They noted that with strong ordering activity expected to continue, EIL's business performance should remain robust. Despite these strong fundamentals, the stock has seen some volatility. However, its current valuation is considered reasonable by analysts, especially given the company's strong cash reserves and a healthy dividend yield of around 2.2%.

Conclusion

Engineers India Ltd. is well-positioned for a period of sustained growth, backed by a record order book and a successful expansion into international markets. The landmark Dangote refinery project in Nigeria underscores its global capabilities and provides long-term revenue visibility. While the company faces the challenge of managing project execution and navigating margin pressures, its strong guidance, healthy project pipeline, and strategic shift towards high-value overseas contracts paint a promising picture for its future financial performance.