Shares of Shakti Pumps (India) fell 9.39% to ₹580 on February 16 after the company reported a sharp decline in its Q3 FY26 earnings, with profitability and margins witnessing significant pressure.
The company posted a 69.5% year-on-year drop in consolidated net profit to ₹31.7 crore for the quarter ended December 31, 2025, compared to ₹104 crore in the same period last year. Revenue declined 15% to ₹551 crore from ₹648.8 crore. EBITDA slipped 61.9% to ₹59 crore, while margins narrowed sharply to 10.7% from 23.9% a year ago, marking a contraction of over 1,300 basis points.
Management attributed the weak performance to a calibrated slowdown in execution, particularly in Maharashtra, aimed at managing elevated receivables. The company deliberately paused orders worth around ₹200 crore to stabilise working capital, prioritising balance sheet discipline over short-term revenue growth.
Margins were also impacted by 4% lower realisations in ‘Magel Tyala’ orders, a 2% increase in raw material costs including copper, steel and solar panels, and higher employee expenses. The quarter included a one-time ₹4.4 crore impact from the new labour code and investments in emerging segments. Additionally, raw materials consumed were sourced from higher-cost inventory carried over from Q2 FY26.
For the nine-month period of FY26, revenue stood at ₹1,839.8 crore, EBITDA at ₹338.5 crore and PAT at ₹219.2 crore. While the order book remains healthy at ₹2,100 crore, the sharp quarterly profit and margin contraction appears to have triggered investor selling pressure in the stock.