Core O&M down 23% YoY; margin boost masks execution risk

Operational revenue down 23% to INR 43.3 Cr; 57-58 Cr other income (largely from acquired assets accounted as investments) masks weak core operations

PAT of 40.8 Cr matches delivered result; growth is real but driven by other income line items, not operational leverage. Core O&M EBITDA margin ~16%, well below 20-22% guidance.

EBITDA margin is 56% on total income (101 Cr) including acquired asset income; management notes ~50 Cr of 57 Cr EBITDA is from acquired/investment assets and value-added services accounted as other income, not core O&M

Only 4 GW is consolidated; 6.5 GW acquired assets still in investment account (Ind AS 109), consolidation expected Q2 FY27 onwards, hence not yet reflected in topline

Prior: 75% growth, 20-22% EBITDA margin, ₹600 Cr EBITDA for FY27. Current Q1: revenue -23% operationally, EBITDA margin 56% on total income (inflated by acquired assets). H2-heavy model is the delta; no prior-quarter guidance change in numbers.

Core O&M EBITDA margin is ~16% (₹57 Cr EBITDA less ~₹50 Cr from acquired assets, divided by ₹43 Cr revenue), below the 20-22% guidance from FY26 call. Only achieved through acquired portfolio's 50%+ margins.

Prior pivot stated; now 59% of third-party orders (excluding INOX GFL) are equipment supply as of July 2026, vs target of 75%. This is a concrete execution step but still below target.

Equipment supply is faster (no ROW/weather delays of EPC); 60% of order book is equipment now; will show results Q3 onwards. 4.4 GW order backlog provides 24-36 month visibility.

Can't guide quarterly; H2 heavy (70-75% of annual revenue); significant improvement in Q2 expected but no numeric commitment.

Pivot to equipment has been stated multiple times; 4.4 GW order backlog (70% equipment) with ready infrastructure and marquee clients; will deliver better than expectations quarterly.

Core INOX portfolio (4 GW) is at 50% EBITDA margin guidance; Q1 had one-time expenses (infrastructure, life extension); acquired portfolios have higher age/revenue, hence higher margins; guidance is 50% core, higher blended post-consolidation.

INR 600 Cr is annualized basis from Q3, Q4 onwards; post-consolidation. Silent period prevents forward guidance beyond public domain; guidance maintained.

4 GW core INOX portfolio: INR 9-10 lakh per MW; 6.5 GW acquired assets (investments, Ind AS 109): substantially higher but won't quantify due to silent period; consolidation expected FY27.

Only force majeure events (geopolitical crises). Otherwise, pivot to equipment, ready infrastructure, marquee clients (Tata, ReNew, Greenko), and INOX Clean orders eliminate risk.

Receivables accounted per Ind AS 115 risk-transfer basis; struck in receivable until commissioned. Will drop significantly as equipment mix increases in Q2-Q3.

Enabling resolutions already done; silent period prevents comment. ALMM: already 80-90% indigenized; expect 100% by year-end; this was a strategic advantage already, not new.

Partly recognized in Q1; balance will be covered in FY27. Incremental equipment supply margin to flow from Q2-end or Q3 onwards.

Anchored on Wind World India consolidation (₹580 Cr FY26, ~₹100-120 Cr incremental to INOX Green Q2-Q4) and INOX Clean orders. Q1 down 23% operationally suggests H2 ramp must be 100%+ to hit target.

Already at 59% as of July 2026. Clear order visibility (4.4 GW backlog, 70% equipment). Equipment model is faster (30-45 day cycle vs 6-12 months EPC).

Core INOX 4 GW portfolio running at ~16% operational EBITDA margin; only achieves target post-acquisition of higher-margin Wind World and other portfolios. Near-term (H1) margin below target.

Annualized from Q3/Q4 onwards post-Wind World consolidation. Management notes guidance is subject to 'a couple of quarters delays in consolidating into parent'; implies Q1-Q2 may not fully reflect.

Jaipur transformer factory expanding from 4.9 MVA to 100+ MVA capacity. Cranes fleet at 4 in operations, more to come in FY27. USS (unit substations) to launch FY27.

Three consecutive quarters of guidance misses per analyst; current Q1 shows -23% operational revenue decline, requiring 100%+ H2 growth to hit 75% annual target. Management's confidence appears aspirational vs data-backed.

Core O&M EBITDA margin of ~16% (calculated as [57 Cr EBITDA - 50 Cr acquired asset income] / 43.3 Cr revenue) is well below 20-22% guidance. Consolidation of acquired assets (which have 50%+ margins) is necessary to achieve blended target, not organic improvement.

₹57-58 Cr of other income (from acquired assets in Ind AS 109 investment account and value-added services accounted differently per norms) inflates reported total income and PAT, masking -23% core revenue decline. Revenue recognition timing is complex due to risk-transfer basis (Ind AS 115), creating quarterly volatility.

Wind World India acquisition brings portfolio of Tata, ReNew, Greenko, Hindustan Zinc, Apraava—while marquee names, any single customer underperformance could impact acquisition economics; INOX Clean as largest new order source is related party.

Trade receivables elevated due to Ind AS 115 risk-transfer basis (receivable struck in account until commissioned); legacy EPC projects create extended payment terms. While improving with equipment mix, Q1 shows continued drag on cash cycle.