Data Patterns reported a strong performance for Q3 FY’26, with revenues growing 48% YoY to INR170 crores, driven by improved execution in defense programs. The company’s order book hit an all-time high of INR1,868 crores. EBITDA margins remained healthy at 44%. Management confirmed confidence in achieving guidance and detailed strategies for scaling IP-driven growth, including sustained investment in in-house development.
Q3 FY’26 Performance and Financial Highlights
Data Patterns (India) Limited disclosed excellent results for the quarter ended December 31, 2025, during its Earnings Conference Call on February 06, 2026. The management highlighted that FY ’26 is shaping up to be a good year, in line with expectations.
Revenue Growth and Order Book Milestones
For Q3 FY’26, the company delivered a strong quarter with revenue growing 48% year-on-year to INR170 crores, supported by improved execution across defense programs. On a 9-month basis, revenues increased significantly by 86% year-on-year to INR580 crores.
Crucially, the order book has reached an all-time high of INR1,868 crores. Key wins during the period included large production and development orders for electronic warfare suites from ECIL and the Ministry of Defence.
Profitability Remains Robust
EBITDA for the quarter stood at INR78 crores, marking a 44% year-on-year increase, with EBITDA margins sustained at a healthy 44%. Profit After Tax (PAT) rose 31% year-on-year to INR58 crores, translating to a net profit margin of approximately 34%.
During the 9-month period, PAT was INR133 crores, reflecting 23% year-on-year growth. Management noted that profitability remains healthy, driven by the high-value nature of the product portfolio and strong in-house capabilities.
Strategic Outlook and Future Focus
Leveraging IP and Ecosystem Development
Mr. S. Rangarajan, Chairman & Managing Director, emphasized the focus on developing IP-driven products. The company is actively pursuing co-development with global defense majors in radar and electronic warfare domains, aiming for global market relevance.
Data Patterns is also engaging with large Indian corporates, notably partnering with Bharat Forge to bid for the AMCA production. The strategic direction is shifting from a subsystem supplier to a full systems and solution provider for the defense sector.
Execution Visibility and Growth Commitments
Management remains confident in achieving guidance, supported by the record order book and disciplined cost management. The long-term goal is to scale revenue meaningfully over the next 3 years while maintaining high profitability. The company remains committed to delivering 20% to 25% revenue growth over the medium term.
Addressing Negotiated Orders and Working Capital
Regarding pending orders, management stated that contracts totaling approximately INR11 billion, which were previously noted as negotiated but not awarded, are expected to be converted into contracts within the next 1 to 2 months.
On working capital, the cycle, which was around 428 days in March, has internally come down to 340 days as of December, with expectations that collections from large development contracts will recharge the cash balance within the next 3 to 4 months.
Q&A Insights: Export Strategy and Platform Independence
Export Market Expansion
While the domestic focus remains paramount, the company acknowledges the large opportunity in the world market, shifting from a low-cost sourcing role to offering IP-driven products. Management expects export momentum to improve, especially given current geopolitical environments influencing European defense spending, although the pace is expected to follow the rapid growth in the domestic market over the next few years.
Platform Agnostic Approach
The company stressed that its capabilities are IP generated and can go to very many platforms. They are not platform-specific, and current activity includes developing products like smart cockpits and avionics systems for LCA Mark 2, and offering advanced sensors like IRST systems for the same platform.
Future Development Pipeline
Management is investing ahead in strategic systems with in-house IP. Key development areas include the modern EW suite and flight control radars, which are expected to realize significant revenue potential (estimated around INR15,000 crores to INR20,000 crores) over a development cycle spanning the next 2 to 5 years.
Source: BSE
