TARIL Q4 FY26 and FY26: Growth, Order Visibility, and a Big Integration Bet

Transformers and Rectifiers (India) Limited (TARIL) closed FY26 with strong growth on both standalone and consolidated financials, backed by faster execution and a healthy order book. On a standalone basis, FY26 revenue was INR 2,395 crore versus INR 1,950 crore in FY25. EBITDA stood at INR 370 crore and PAT was INR 225 crore. In Q4 FY26, standalone revenue from operations was INR 752 crore, up 16.2% YoY, while EBITDA was INR 117 crore and PAT was INR 77 crore.

The consolidated picture was also strong. FY26 consolidated revenue from operations was INR 2,509 crore, EBITDA was INR 444 crore, and PAT was INR 272 crore. However, quarterly profitability showed some pressure in margins, with Q4 FY26 standalone EBITDA margin at 15.1% compared to 17.1% in Q4 FY25, and consolidated EBITDA margin at 17.5% compared to 20.2% in Q4 FY25.

FY26 performance: scale-up with steady profitability

Management attributed revenue improvement to faster execution of major orders, better production planning, and tighter internal controls and systems. The company also highlighted operational output, with management stating it achieved the highest ever production in FY26.

Order visibility remains a key support for the near-term revenue trajectory. TARIL reported an unexecuted order book of INR 5,005 crore as of 31 March 2026. FY26 new order inflow was stated at INR 2,374 crore, while Q4 order inflow was INR 244 crore. The company also disclosed a large pipeline, with inquiries under negotiation exceeding INR 23,000 crore.

Order strategy: selective intake and delivery discipline

A notable theme in the concall was management’s deliberate moderation of new orders. The MD and CEO stated that the company is strategically delaying new orders to select those with better margins, better payment terms, and delivery schedules aligned with TARIL’s production cycle. Management reiterated a preference to avoid taking orders with delivery commitments beyond 24 months.

The order book mix disclosed on the call indicates a majority contribution from utility-linked demand. Management stated that roughly 55% of the order book is from utilities, around 20% from EPC contractors, and the balance from private customers. This mix matters because utility orders can be large and provide execution visibility, but can also influence working capital cycles, as discussed later.

Capacity expansion and backward integration: the margin improvement roadmap

The Chairman outlined a capex plan of INR 600 crore over the next 15 months. Two capacity initiatives were highlighted: commercial production for a 15,000 MVA addition at Changodar, and a planned 22,000 MVA addition at Moraiya. In the concall, management acknowledged delays at Changodar and attributed them to extended monsoons. Moraiya expansion was indicated to be planned after the year’s monsoon, with management discussing an indicative timeline around Q3 FY27.

Parallel to capacity additions, TARIL is pushing a multi-part backward integration program. Management referenced four new backward integration facilities: CTC, bushing, pressboard, and fabrication. The Chairman stated the company aims to become a 100% backward integrated organization by Q1 FY27-28, with a slight delay due to slow site progress and late arrival of plant and machinery. The CFO stated that backward integrated facilities are expected to be fully operational from Q1 FY28.

Management explicitly linked backward integration to margin improvement. On the concall, it was stated that these initiatives could improve the margin profile by about 150 to 200 basis points. The company also indicated progress on upstream sourcing, noting that it has started receiving CRGO from its acquired CRGO processing unit.

HVDC entry: repair order as a qualification pathway

The company highlighted a landmark HVDC transformer repair order from PGCIL, describing it as a first-of-its-kind order for an Indian company. Management stated that successful completion of this repair can lead to approval for HVDC transformer manufacturing from PGCIL. The process, as described, involves returning the repaired transformer and then achieving six months of satisfactory operation, after which PGCIL would begin approval steps.

Management also indicated that HVDC projects can be attractive due to technical barriers and limited competition. In one response, management stated that the HVDC transformer could represent around 40% of an HVDC project’s overall capex, positioning it as a large-ticket equipment opportunity if qualification is achieved.

Balance sheet and working capital: the near-term pressure point

FY26 balance sheet numbers show a sharp increase in working capital items. Inventories rose to INR 560.88 crore from INR 399.43 crore in FY25, while current trade receivables increased to INR 853.30 crore from INR 443.15 crore. Short-term borrowings including current maturities increased to INR 370.92 crore from INR 182.21 crore.

Management acknowledged collections timing issues, particularly with utilities around the March year-end. The CFO stated that about INR 200 crore was collected in the first 15 to 16 days of April, implying that part of the year-end receivable build-up was timing-related.

Key takeaways

TARIL’s FY26 performance reflects a company scaling execution while maintaining profitability in a tight supply-chain environment. The combination of a large unexecuted order book, ongoing capacity additions, and a clearly articulated backward integration roadmap sets the base for the next phase.

The key variables to track are straightforward. First, how quickly the new capacity ramps up after commissioning. Second, whether backward integration translates into the 150 to 200 bps margin improvement management has cited. And third, whether working capital normalises as execution scales and payment cycles stabilise.

Management’s stance for the near term is also clear. The company intends to remain selective on order intake, keep delivery exposure within 24 months, and pursue margin improvement through integration and scale rather than chasing every available order.