Blue Star Limited reported modest revenue growth in Q3 FY26, with a revival in Room Air-Conditioner sales anticipated due to energy label changes. The company is focusing on a strong Q4 FY26 and expects market revival. Despite challenges, cost optimization improved margins, and the company gained market share. An estimated 10% net price increase is expected for consumers due to combined effects of GST, energy label changes, and rising commodity prices.
Financial Performance
Blue Star Limited announced a 4.2% increase in revenue from operations for Q3 FY26, reaching ₹2,925.31 crore compared to ₹2,807.36 crore in Q3 FY25. EBITDA, excluding other income, improved to ₹220.72 crore. The carried-forward order book grew by 1.3% to ₹6,898.74 crore as of December 31, 2025.
Segment Performance
The Electro-Mechanical Projects & Commercial Air Conditioning Systems segment saw revenue growth of 8.6%, with revenue reaching ₹1,696.21 crore in Q3 FY26. The Unitary Products segment remained flat at ₹1,154.22 crore. Commercial Air-Conditioning witnessed healthy order bookings. The company anticipates a strong Q4 FY26 for Room Air-Conditioners, Commercial Air-Conditioning, and Refrigeration products.
Strategic Outlook
The company expects a market revival, particularly in the Room Air-Conditioner segment, due to the energy label changes effective from January 1, 2026. Blue Star expects an overall 10% net increase in prices for consumers due to the interplay of factors, including GST reduction, energy label changes, and commodity prices. The company focuses on expanding distribution reach, investing in R&D, and persisting with cost optimization measures.
Future Growth and Margins
Management anticipates a 8.5% margin for the UCP segment in Q4 FY26 and FY27. Long-term CAGR for commercial air conditioning segment expected at approximately 10% to 12%, while room air conditioners are projected at a 19% CAGR.
Source: BSE
