Greaves Cotton Q3 Profit Jumps 23% as Margins Expand

Greaves Cotton's Q3 FY26 Financials

Greaves Cotton Ltd announced a robust financial performance for the third quarter of fiscal year 2026, which ended on December 31, 2025. The diversified engineering company reported significant year-on-year growth in key financial metrics, including revenue, operating profit, and net profit. The positive results, declared on January 6, 2026, were well-received by the market, leading to an uptick in the company's share price. This performance underscores the company's operational efficiency and the successful execution of its diversification strategy across various business verticals.

Strong Growth in Revenue and Profit

For the December quarter (Q3 FY26), Greaves Cotton posted a consolidated net profit of ₹25.5 crore, marking a substantial 22.6% increase compared to the ₹20.8 crore reported in the same period of the previous fiscal year. This growth in profitability was supported by a healthy expansion in the company's top line. Revenue from operations for the quarter rose by 16.6% year-on-year, reaching ₹875.5 crore, up from ₹750.6 crore in Q3 FY25. The steady revenue growth reflects consistent demand and performance across the company's core business segments.

Operational Excellence Drives Margin Expansion

A key highlight of the quarter was the significant improvement in the company's operating performance. Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) surged by an impressive 56.3% year-on-year to ₹61.8 crore, compared to ₹39.5 crore a year earlier. This sharp increase in operating profit led to a notable expansion in EBITDA margins. The company's margin stood at 7.0% in Q3 FY26, a significant improvement from the 5.3% recorded in the corresponding quarter of the previous year. This 170-basis-point expansion is attributed to improved operating leverage and successful cost-efficiency measures implemented by the management.

Q3 FY26 Performance Summary

Positive Market Reaction

Following the announcement of the strong quarterly results, investors showed confidence in the company's stock. Shares of Greaves Cotton were trading at ₹172.18 on the National Stock Exchange (NSE), marking a gain of 1.64% for the day. During the trading session, the stock touched an intraday high of ₹177.50, reflecting positive market sentiment driven by the healthy earnings report.

Diversified Business Portfolio Fuels Growth

Greaves Cotton's performance is a testament to its well-diversified business model. The company operates across several key sectors, including clean mobility, power generation, farm equipment, and aftermarket solutions. A significant part of its growth strategy involves its focus on the electric mobility segment, which includes both retail and manufacturing operations. The consistent performance across these varied segments has provided a stable foundation for growth and helped the company navigate different market cycles effectively.

Sustained Momentum from First Half of FY26

The strong Q3 performance builds on the momentum seen in the first half of the fiscal year. For H1 FY26, the company reported a consolidated revenue of ₹1,561 crore, up 16% year-on-year. The electric mobility business showed particularly strong growth, with Electric Two-Wheeler (E2W) volumes increasing by 54% year-on-year in H1 FY26, improving its market share from 3.2% to 4.2%. This sustained growth across its business units, especially in high-potential areas like electric vehicles, positions the company well for future expansion.

Management's Strategic Focus

Commenting on recent performance, Parag Satpute, MD and Group CEO of Greaves Cotton Limited, highlighted the company's strategic direction. He emphasized that the core engineering business has achieved strong growth driven by a customer-centric approach to product development and efficiency enhancements that have strengthened margins. The management remains focused on disciplined execution, operational excellence, and prudent capital allocation to create sustainable value for shareholders. This strategy is centered on leveraging its diverse engineering portfolio to serve the Genset, Automotive, and Industrial sectors.

Conclusion

Greaves Cotton's Q3 FY26 results demonstrate a period of strong financial health, characterized by robust growth in both revenue and profitability. The significant expansion in operating margins highlights the company's ability to manage costs and improve efficiency. With a positive market reaction and a clear strategic focus on its diversified portfolio, particularly in the growing electric mobility space, Greaves Cotton appears well-positioned to continue its growth trajectory.