Hirect Limited revenue rises 30% but underlying Q2 profit falls

Hirect Limited reported standalone revenue from operations of Rs 294.347 crore for the quarter ended September 30, 2026, up 30% from Rs 227.147 crore a year earlier, while profit before exceptional items and tax fell 15% to Rs 16.692 crore. Higher expenses and working-capital movements also resulted in a first-half operating cash outflow of Rs 16.227 crore.

Why did Hirect revenue increase in Q2?

Hirect's revenue from operations increased by Rs 67.2 crore year on year to Rs 294.347 crore in the September 2026 quarter, from Rs 227.147 crore in the September 2025 quarter. It also rose from Rs 236.392 crore in the quarter ended June 30, 2026. Total income, including other income, reached Rs 295.748 crore, compared with Rs 227.277 crore a year earlier.

Engineering Products recorded segment revenue of Rs 292.341 crore in Q2, compared with Rs 227.147 crore in the prior-year quarter. The CTC/PICC/EPICC segment reported Rs 58.879 crore of revenue, while intersegment revenue was Rs 56.873 crore. CTC means continuously transposed conductor, and Hirect identified its CTC plant as a separate reportable segment from November 3, 2025.

For the half year ended September 30, 2026, revenue from operations was Rs 530.739 crore, compared with Rs 441.921 crore in the corresponding 2025 half year. The CTC/PICC/EPICC segment reported half-year revenue of Rs 98.385 crore. Hirect did not present a corresponding prior-period figure for that segment because the manufacturing operations commenced during the current financial year.

Why did Hirect's underlying profit decline despite revenue growth?

Hirect's profit before exceptional items and tax declined to Rs 16.692 crore in Q2 from Rs 19.668 crore a year earlier because total expenses increased faster than revenue. Expenses rose to Rs 279.056 crore from Rs 207.609 crore, while total income increased to Rs 295.748 crore from Rs 227.277 crore over the same period.

Material consumption rose to Rs 217.718 crore from Rs 186.75 crore, employee-benefit expense increased to Rs 25.744 crore from Rs 19.155 crore, and other expenses reached Rs 16.541 crore from Rs 12.511 crore. Finance costs were Rs 4.534 crore against Rs 3.564 crore, while depreciation and amortisation increased to Rs 4.182 crore from Rs 2.806 crore.

Hirect recorded exceptional items of Rs 2.676 crore in Q2, whereas no exceptional item was reported in the comparable quarter. The half-year cash-flow statement identifies the Rs 6.204 crore exceptional amount as a gain on sale of assets held for sale. After this item, profit before tax was Rs 19.368 crore, compared with Rs 19.668 crore a year earlier.

Engineering Products generated a Q2 segment result of Rs 25.444 crore, up from Rs 23.232 crore in the prior-year quarter. CTC/PICC/EPICC generated Rs 1.935 crore, taking combined segment result to Rs 27.379 crore. Interest of Rs 4.534 crore and other unallocable expenditure net of unallocable income of Rs 6.153 crore were deducted before the exceptional gain was included in profit before tax.

What happened to Hirect's operating cash flow?

Hirect reported a standalone net cash outflow from operating activities of Rs 16.227 crore for the half year ended September 30, 2026, compared with an inflow of Rs 63.347 crore a year earlier. Operating profit before working-capital changes increased to Rs 60.132 crore from Rs 58.392 crore, but working-capital movements changed the cash outcome.

Inventory absorbed Rs 34.713 crore during the 2026 half year, compared with Rs 22.099 crore in the prior-year period. Trade and other receivables released Rs 15.074 crore, versus a use of Rs 8.522 crore a year earlier. Trade payables used Rs 18.858 crore, compared with generating Rs 6.111 crore in the previous half year, and other financial liabilities used Rs 25.332 crore against a prior-year inflow of Rs 35.47 crore.

Cash generated from operations was negative Rs 10.298 crore, compared with positive Rs 71.879 crore in the corresponding 2025 half year. Net taxes paid were Rs 5.929 crore, below Rs 8.532 crore a year earlier. These movements resulted in the reported operating cash outflow despite the increase in operating profit before working-capital changes.

How did Hirect's balance sheet change by September 2026?

Hirect's standalone total assets were Rs 683.333 crore at September 30, 2026, compared with Rs 612.612 crore at March 31, 2026. Inventories increased to Rs 169.993 crore from Rs 135.28 crore, while trade receivables declined to Rs 151.91 crore from Rs 227.097 crore. Property, plant and equipment rose to Rs 152.649 crore from Rs 146.692 crore.

Cash and cash equivalents on the balance sheet were Rs 60.817 crore at September 30, compared with Rs 32.1 lakh at March 31. The cash-flow statement records net proceeds of Rs 99.9 crore from a preferential issue in the half year. Equity increased to Rs 347.597 crore from Rs 221.264 crore, including a rise in paid-up share capital to Rs 7.092 crore from Rs 6.874 crore.

Non-current borrowings declined to Rs 24.76 crore at September 30 from Rs 32.504 crore at March 31, while current borrowings fell to Rs 161.26 crore from Rs 189.776 crore. Intangible assets under development increased to Rs 7.945 crore from Rs 5.879 crore. The balance-sheet movements occurred alongside the Rs 16.227 crore operating cash outflow recorded for the six months.

Conclusion

Hirect combined 30% year-on-year Q2 revenue growth with a 15% decline in profit before exceptional items and tax, as expenses rose to Rs 279.056 crore. The first-half cash-flow result was also materially different from the prior year, moving from a Rs 63.347 crore operating inflow to a Rs 16.227 crore outflow as inventories, trade payables and other financial liabilities absorbed cash.

The next results will show whether the Rs 98.385 crore half-year contribution from CTC/PICC/EPICC and the Rs 99.9 crore preferential-issue proceeds translate into operating cash generation and improved pre-exceptional profit. Hirect has also said the effective date for moving its registrar and share transfer agent from Adroit Corporate Services Pvt. Ltd to Bigshare Services Private Limited will be communicated after definitive agreements are executed.