Pace Digitek Q1 FY27: Energy-led execution drives growth, as manufacturing scale-up gathers pace

Pace Digitek began FY27 with a sharp year-on-year jump in consolidated revenue, led by energy storage and renewable execution. For Q1 FY27, revenue from operations came in at INR 555.4 crore, up 51.3 percent versus Q1 FY26. EBITDA rose 7.5 percent year on year to INR 86.1 crore, translating into a 15.5 percent margin. Profit after tax was INR 62.5 crore, up 14.3 percent, with an 11.3 percent PAT margin.

The quarter also highlighted how quickly the business mix has changed. Energy contributed 79.5 percent of Q1 FY27 revenue, supported by BESS and renewable energy project execution, while Telecom and ICT contributed 20.5 percent. Management described the sequential revenue decline versus Q4 FY26 as largely timing-driven, pointing to milestone-based recognition and the early-stage ramp-up of several projects during the quarter.

The revenue mix is now energy-first

In the investor presentation, Pace Digitek showed a steep shift in segment contribution across recent quarters. Energy was a small share in early FY26 but became dominant by Q4 FY26 and remained high in Q1 FY27.

For Q1 FY27, energy accounted for 79.5 percent of revenue, while telecom and ICT was 20.5 percent. This is a meaningful change for a company historically associated with telecom infrastructure and services. It also reshapes the near-term margin and working-capital profile, because the company repeatedly highlighted that the energy business has better payment terms compared to telecom.

Management also said it is trying to reduce the typical year-end concentration seen in infrastructure businesses, with a stated aim that H1 FY27 contributes about 40 to 45 percent of the full-year revenue.

Order book remains the anchor for visibility

As of 30 June 2026, the company reported an executable order book of INR 10,803.3 crore, providing management confidence in its ability to deliver on FY27 guidance. The order book split was INR 8,453.0 crore in energy and INR 2,350.3 crore in telecom and ICT.

During Q1 FY27, Pace Digitek reported new orders of INR 1,676.6 crore across energy and ICT. The key wins were two standalone BESS EPC projects and one BharatNet OFC order.

The energy wins were:

NLC India: INR 709.9 crore for a 250 MW and 500 MWh standalone BESS supply, EPC and long-term O&M contract

DVC: INR 702.0 crore for a 250 MW and 500 MWh standalone BESS supply, EPC and long-term O&M contract

Both projects carry an execution period of about one year for EPC, followed by 12 years of O&M services.

The telecom and ICT win was:

BSNL BharatNet OFC EPC: INR 264.7 crore in the Sikkim telecom circle, with management stating execution over about two and a half years.

Pace Digitek’s disclosed order book tables also provide useful context on the nature of work. In energy, the total executable value was shown at INR 8,453.0 crore across BOO, EPC and supply. In telecom and ICT, the total executable value was shown at INR 2,350.3 crore across EPC plus O&M, EPC, supply and standalone O&M.

Execution and manufacturing: capacity and commissioning move in parallel

The company’s strategy is built around an integrated energy platform, with manufacturing, EPC and BOO models designed to reinforce one another. The quarter included multiple operational updates that fit this narrative.

First, the BESS BOO execution at MSEDCL remained a key milestone. In the investor presentation, the company said it commissioned 375 MWh in Q1 FY27 and that cumulative commissioned capacity at MSEDCL stood at 975 MWh. The presentation also stated that execution is ahead of planned schedule. Management highlighted an O&M support system including centralized monitoring and field service infrastructure.

Second, Pace Digitek discussed progress across other energy projects. For SECI solar plus BESS BOO, it stated that the PPA has been executed and civil works are progressing. For KPTCL standalone BESS BOO, management stated the BESPA has been executed, land has been allotted, and civil works including foundations have started. Solar EPC projects such as Bondada and MAHAGENCO were described as being at various stages from mobilization and procurement to feasibility and grid connectivity.

Third, manufacturing scale-up was central to the quarter’s narrative. The presentation said an additional 2.5 GWh BESS production line became operational in August 2026 and that a container fabrication facility was nearing completion. It also described a new 5 GWh line where construction is complete, equipment is expected by October 2026, and operations are expected by Q3 FY27.

In the concall, management added an explicit timeline: equipment arrival towards end of September 2026, installation in October and November, and a target of having a 10 GWh operational facility around early December 2026. It also cited container fabrication as a bottleneck that the company is addressing through in-house manufacturing.

Management also provided a capex figure for the manufacturing expansion, stating an overall capex spend of about INR 300 crore across the phases including the container fabrication unit.

Technology, margin mix, and cash flow: what management emphasized

Beyond execution and capacity, the concall provided insight into how the company is thinking about risks and the next phase of growth.

On margins, management indicated it is targeting PAT margins of about 10.5 to 11 percent for the year, and confirmed telecom has better margins than energy, though volumes currently are higher in energy. It also discussed the difference between grid-scale BESS and commercial and industrial BESS. The CFO stated that for grid-scale BESS, product margins are about 13 to 15 percent, while in the C&I segment this margin can be higher by another 4 to 5 percentage points at the EBITDA level.

On commodity risk, the company acknowledged lithium-ion cost variability and said that more recent tenders are coming with price variation clauses, while older tenders did not. It also said it builds contingencies into bids and that being both manufacturer and project company reduces the impact versus pure EPC players.

On working capital and cash flows, management acknowledged that operating cash flow has been negative for some time. It attributed this primarily to telecom receivables and milestone-based payments, stating that the majority of receivables are from telecom. It also quantified working-capital cycles, citing telecom net working capital at about four to five months, and energy at about 90 to 100 days. The CFO said cash flow from operations is expected to turn positive by March as energy contribution increases and telecom receivables ease.

On technology and localization, the company announced the Pace-Lineage Research Center in Pune and a collaboration with IISER Pune. The stated research focus includes advanced chemistry cells, including lithium-ion and sodium-ion materials. Management also acknowledged that cells are currently sourced from China and discussed planning for indigenous cell manufacturing. It further said it is applying for the Government of India PLI scheme for cell manufacturing for 4 GWh.

Finally, Pace Digitek discussed entering AI data center power infrastructure through a partnership with Megmeet. Management said customer discussions have begun and demo equipment is being prepared, positioning this as a new segment opportunity.

Guidance and the near-term setup

In the investor presentation, Pace Digitek provided revenue guidance for both FY27 and FY28:

FY27E revenue guidance: INR 3,200 to 3,400 crore

FY28E revenue guidance: INR 4,000 to 4,200 crore

Management reiterated in the concall that it believes it is on track to meet FY27 guidance, supported by the order book and execution momentum. It also discussed that BOO accounting treatment can affect reported revenue, noting that certain BOO components are treated as fixed assets rather than P&L revenue even when physical execution is progressing.

The near-term watchpoints are straightforward. Execution pace must stay strong across both energy and telecom projects. The manufacturing ramp to 10 GWh, the success of backward integration into container fabrication, and discipline around working capital will determine whether the company can translate the order book into consistent reported profitability and improving cash conversion.

Pace Digitek’s Q1 FY27 message was clear: the company is building an integrated energy and infrastructure platform, with manufacturing scale and execution capacity intended to reinforce each other. The numbers show that the shift is already visible in the revenue mix. The next few quarters will test how smoothly the ramp-up converts into steadier margins and stronger cash flows.