KRN Heat Exchanger and Refrigeration Limited announced robust financial results for Q3 FY’26 and the 9M period, driven by strong demand in HVAC and export markets. Consolidated Q3 revenue grew 33% YoY to INR155 crores, while net profit surged 65% YoY to nearly INR23 crores. Management highlighted steady execution, inventory gains offsetting volatility, and the imminent inauguration of their new manufacturing facility on March 11th.
KRN Q3 FY’26 Earnings Call Summary
KRN Heat Exchanger and Refrigeration Limited held its Q3 and 9M FY ’26 Earnings Conference Call on February 9, 2026, represented by Mr. Santosh Kumar Yadav (Chairman & MD), Mr. Sonu Gupta (CFO), and Mr. Jitendra Sharma (CS). The management shared details on solid financial performance and ongoing growth strategies.
Consolidated Financial Performance Highlights (Q3 FY’26)
The third quarter demonstrated excellent operating performance as the business scales:
- Consolidated Total Income grew by about 33% YoY to roughly INR155 crores.
- EBITDA nearly doubled to around INR31 crores.
- Net Profit for the quarter grew by an impressive 65% YoY to nearly INR23 crores.
Nine Months Ended FY’26 Performance
The 9-month period also showed significant year-on-year growth:
- Standalone Total Income grew about 58% YoY to approximately INR485 crores.
- Standalone Net Profit increased nearly 49% YoY to about INR54 crores.
- Consolidated Total Income stood at approximately INR428 crores (40% YoY growth).
- Consolidated EBITDA grew 53% to around INR79 crores, with Net Profit up nearly 40% to about INR53 crores.
Growth Drivers and Industry Outlook
Mr. Jitendra Sharma noted that the business is benefiting from structural tailwinds in the HVAC and refrigeration sector, including urbanization and demand for energy-efficient solutions. Key segments driving demand include data centers, commercial buildings, and transport refrigeration. The company emphasizes a consistent approach focused on reliable execution, capability investment, and customer relationships.
New Facility Inauguration and Capacity Ramp-Up
Chairman Mr. Santosh Kumar Yadav confirmed that the new facility is currently in the ramping stage and will be fully inaugurated on March 11th. Regarding capacity utilization guidance, the company aims to achieve around 20% capacity utilization from HVAC in the current fiscal year, with plans to reach 50% utilization in the next fiscal year. The existing KRN Heat segment is near full capacity.
Bus Air Conditioning (AC) Business Update
The management confirmed that the Bus AC business has started well, with a promise to capture significant numbers this year. Although it is a new business line, KRN benefits from backward integration in key components like heat exchangers, tubing, and in-house FRP. The Pan-India bus AC market is estimated at around INR1000 crores plus, growing 20% to 25% YoY. KRN aims to cover at least 15% of this total market share next year.
Input Cost Management and Margins
Regarding commodity volatility (aluminum and copper), management stated that input costs do not directly impact the 2-3 month order book immediately due to their inventory strategy of holding 2 to 2.5 months of inventory on hand plus transit stock. Prices are adjusted quarterly based on LME averages. Regarding margin changes, the contraction in consolidated EBITDA margins was attributed to inventory gains from previous purchasing and the nature of backward integration where costs previously bought externally are now recognized internally.
Data Center Revenue Contribution and Exports
Data center business contributed almost 15% of the top line by the end of Q3. While the majority of current business is domestic, export growth is being targeted in the USA and Europe markets, supported by new geometry testing. Management believes they can offer a 15% to 20% landed price advantage over European/USA suppliers in these segments.
Management Expansion
In terms of top management enhancement, the company has recently added an Export Sales President and a President for Food and Non-Food business, along with three new Directors of Operations, as part of strengthening governance ahead of expedited growth.
Source: BSE
