Welspun Q2 Results: Profit Up 59%, Plans ₹1,000 Cr Capital Raise

Welspun Enterprises Ltd (WEL), part of the Welspun World conglomerate, reported a strong second quarter (Q2 FY26) with a 59% year-on-year (YoY) rise in net profit to ₹98 crore, driven by lower expenses and strong operational margins. The company also announced plans to raise ₹1,000 crore to fund expansion opportunities.

Despite a 4% dip in revenue, WEL showcased its operational strength, with record-high margins and steady order book growth across its core segments: water infrastructure, transportation, and tunnelling. So, the question here is, what’s the strategy behind Welspun’s growth?

How Welspun Sustained Profit Growth Amid Lower Revenue

For the quarter ended September 2025, total income stood at ₹803.26 crore, down around 4% from ₹837.92 crore a year ago. Despite this dip, the company’s net profit rose sharply to ₹98.08 crore from ₹61.56 crore in Q2FY25. The improvement came on the back of effective cost control, with total expenses reduced to ₹677.42 crore, compared to ₹736.33 crore in the same period last year.

The quarter also marked a record-high EBITDA margin of 23.9%, up from 17.9% in Q2FY25, highlighting improved execution efficiency. EBITDA grew 28% year-on-year to ₹192 crore, despite a revenue decline. For the first half of FY26, EBITDA reached ₹399 crore, up 17% YoY, reinforcing consistent performance.

In contrast, revenue from operations fell 4% YoY to ₹784 crore in Q2FY26 due to project timing and lower execution in some transport projects. Still, the company’s focus on high-margin water and tunnelling contracts offset much of the softness in topline performance. Mr Sandeep Garg, Managing Director of Welspun Enterprises, highlighted that Welspun’s strategic rebalancing between annuity-based and build-operate-transfer (BOT) models provided earnings visibility and margin stability, even amid varying revenue flows. The company also maintains a healthy cash position of ₹1,043 crore as of September 2025, providing ample liquidity to fund upcoming projects.

New Project Wins Strengthen Order Book

A major highlight of the quarter was Welspun Enterprises’ Letter of Award for a ₹3,145 crore, 910 MLD Water Treatment Plant project at Panjrapur, Maharashtra. This comes on top of its ongoing 2,000 MLD Bhandup project, both of which will enable the company to treat nearly 70% of Mumbai’s freshwater needs once operational.These projects collectively raised Welspun’s consolidated order book to ₹15,600 crore, one of the largest in its history.

The company also emerged as L1 bidder for the Pune–Shirur elevated highway corridor, valued at ₹7,300 crore under the Maharashtra State Infrastructure Development Corporation (MSIDC).

By expanding its footprint across water and transportation segments, Welspun aims to balance recurring cash flows with growth-driven revenue streams. “We continue to evaluate prospects and will bid selectively for projects that meet our return benchmarks,” the management stated in its investor update.

Capital Raising to Power Future Growth

To capture emerging opportunities in water and infrastructure, Welspun Enterprises will raise ₹1,000 crore through a preferential issue of warrants via private placement, including participation from the promoter group. The capital infusion reflects long-term confidence in the company’s business model and strategic roadmap.

As of September 30, 2025, Welspun Enterprises’ total investments stood at ₹1,355 crore, spread across diverse infrastructure segments. The company plans to infuse about ₹140 crore over the next year to support ongoing projects.

As of September 2025, Welspun’s net worth stood at ₹2,870 crore, while gross debt was ₹1,731 crore, implying a comfortable leverage position. The firm’s net debt-to-equity ratio remains conservative, providing flexibility for new project bids and investments.

Beyond transportation and water, Welspun is also exploring new opportunities in tunnelling, a sector expected to gain traction as India expands its metro, highway, and hydropower networks. Management noted that the company will “pursue these opportunities judiciously to ensure long-term value creation.”

With over 1,000 kilometres of road projects executed and multiple water projects under development, Welspun is emerging as one of the few mid-sized infrastructure firms combining operational efficiency with strategic agility.

The company’s focus remains anchored on its 3G strategy, Growth, Governance, and Green, emphasising sustainable infrastructure development while maintaining financial prudence.

Conclusion

Welspun Enterprises’ second-quarter results reaffirm its steady growth trajectory, marked by margin expansion, strong project execution, and a growing order book. The upcoming ₹1,000 crore capital raise will further enhance its ability to scale operations in high-growth sectors.

As India’s infrastructure cycle deepens, Welspun’s ability to sustain profitability and execute large-scale projects efficiently will define its next phase of growth. So, can Welspun maintain this balance of growth and discipline as competition intensifies in the infrastructure space?

Sources:

Economic Times
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