Thermax shares plunge 16% after Q1 profit drops 83% on ₹91 crore one-time project cost overrun

The heavy electrical equipment-making company posted an 83% decline in its consolidated net profit at ₹25 crore for the first quarter of the current financial year (Q1 FY27) as compared to ₹152 crore logged during the same period last year.

Thermax in its investor presentation explained that the decline in profit was mainly due to a one-time project cost overrun of ₹91 crore in the Industrial Infrastructure segment.

The firm’s revenue from operations, however, increased 7% to ₹2,303 crore in the April-June quarter as against ₹2,158 crore seen in the year-ago period.

The operating profit, also known as earnings before interest, taxes, depreciation, and amortisation (EBITDA), slipped 70% to ₹69 crore as compared to ₹225 crore in the corresponding quarter of the previous fiscal year. Its EBITDA margin also contracted to 2.97% in the reporting quarter from 10.43% in Q1 FY26.

Thermax registered a 2% annual increase in order booking, which stood at ₹2,809 crore for the recording quarter. The company continued to witness steady order inflows across key sectors, including chemicals, food & beverages, and metal & mining, indicating sustained demand in its core business segments.

Additionally, data centres are emerging as a high-potential growth area for Thermax, with increasing traction in this segment.

Segment updates

Thermax’s Industrial Products segment performance was impacted by higher input costs and a decline in export sales during the quarter. Additionally, the industrial infrastructure segment was affected by a ₹91 crore increase in the estimated cost to complete a specific project, following events identified during the period.

The Chemicals segment reported improved profitability, supported by higher volumes and a better product mix. This indicates relatively stronger operational performance within the segment compared to others.

Meanwhile, the Green Solutions business faced margin pressure due to project overrun costs incurred during the quarter, which weighed on its overall performance.

Thermax demerger

Along with the earnings, the board of directors has also approved a scheme under which Thermax Bioenergy Solutions Private and Thermax Cooling Solutions will be merged with Thermax.

Both Thermax Bioenergy Solutions Private Limited and Thermax Cooling Solutions Limited are wholly owned subsidiaries of the company. The proposed merger is subject to necessary regulatory and shareholder approvals.

“The Scheme is subject to necessary statutory and regulatory approvals, including approval of the Jurisdictional Hon’ble National Company Law Tribunal (“NCLT,”) and other regulatory authorities, as may be required in terms of the applicable provisions of the law,” Thermax said.

The demerged undertaking business is in line with the business of the parent company and thus the management has decided to consolidate the similar businesses by demerging the EPC segment into the firm.

Thermax share price trends

On Friday, Thermax shares were trading at ₹4,041 apiece on the National Stock Exchange, declining 4.95%. However, it settled higher by 1.28% by the end of the session at ₹4,306 per share.

From the beginning of the year, Thermax shares have zoomed 32%. Over a month’s time, the stock has fallen 22%.

According to NSE data, as of July 31, 2026, Thermax has a total market capitalisation of ₹48,210.64 crore.