Semac Construction posts higher September-quarter profit despite revenue decline

Semac Construction operates a project-led engineering, procurement and construction services business, with work-contract services accounting for more than 92 per cent of its FY26 customer-contract revenue. The company reported a sharp improvement in consolidated profitability for the quarter ended September 30, 2026, even as revenue declined from the year-earlier period.

Consolidated net profit rose to Rs 1.79 crore in the September quarter from Rs 0.09 crore a year earlier. Profit before Tax increased to Rs 1.28 crore from Rs 0.29 crore. Revenue from operations, however, fell 15.9 per cent YoY to Rs 48.20 crore, while total income declined to Rs 49.30 crore from Rs 58.31 crore.

The improvement in profit came as quarterly expenses dropped to Rs 48.02 crore from Rs 58.02 crore in the corresponding quarter last year. Cost of services and material consumed declined to Rs 38.47 crore, while employee-benefit expenses stood at Rs 6.48 crore. Finance costs were Rs 0.70 crore and other expenses were Rs 2.02 crore.

For the first half of FY27, consolidated net profit rose to Rs 2.19 crore from Rs 1.17 crore in the previous year. This came despite a 27.8 per cent YoY decline in revenue from operations to Rs 78.62 crore. Profit before tax for the six-month period increased to Rs 2.29 crore from Rs 1.67 crore, indicating that lower costs partly offset the contraction in project revenue.

Working-capital indicators showed some improvement during the first half. Trade receivables declined to Rs 26.91 crore at September 30 from Rs 36.78 crore at March 31, while current borrowings reduced to Rs 20.07 crore from Rs 25.72 crore. Cash and cash equivalents, however, fell to Rs 7.46 crore from Rs 10.28 crore after the group recorded an operating cash outflow of Rs 6.64 crore during the period.

The proposed merger of wholly owned subsidiary Semac Construction Technologies India Private Ltd with Semac Construction remains subject to final approval from the National Company Law Tribunal. The company said no accounting effect of the scheme has been given in the September-quarter results. The statutory auditor issued an unqualified review report on the consolidated numbers.

Semac Construction shares last traded at Rs 224.50 at 3:50 pm on November 12, 2026. The stock was unchanged for the day but remained 58.42 per cent lower over one year, compared with a marginal 0.08 per cent decline in the BSE 500 over the same period. At the last traded price, the stock was about 46.6 per cent below its 52-week high of Rs 420.80, while remaining around 11.1 per cent above its 52-week low of Rs 202.10.

What This Means for Investors

The quarter supports the view that Semac can improve earnings through tighter cost control and lower financing costs even when project revenue is under pressure. The reduction in receivables and current borrowings also strengthens the balance-sheet position. However, the scale of the revenue contraction remains significant for a company whose work-contract business depends on project execution, billing milestones and cost estimates.

The development is therefore mixed but directionally constructive. Profit recovery in the September quarter and first half signals better operating discipline, yet earnings visibility will depend on the company rebuilding revenue momentum and converting project work into cash. The first-half operating cash outflow, alongside lower cash balances, remains an important point to track. The pending subsidiary merger could alter the group structure once it becomes effective, but it has not yet affected reported financial performance.

Disclaimer: The article is for informational purposes only and not investment advice.