Deep Industries Eyes Robust FY26 Growth and Margins

Ashwin Thakker

16 Aug 2025 — 2 min read

FY26 Revenue Growth: Expected over 30% year-on-year.
EBITDA Margin Outlook: Anticipated to remain within the 40-45% range, with potential for further improvement from new acquisitions (e.g., Dolphin expected 60%+).
Order Book Strength: Stood at Rs. 3,051 crores as of Q1 FY26, marking a 152.15% year-on-year increase.
Planned Capex FY26: Approximately INR 70-80 crores for production enhancement, with an additional INR 350-400 crores eyed for opportunistic Dolphin fleet expansion.

Deep Industries Limited reports a stellar 61.6% Q1 FY26 revenue surge, setting a strong precedent for future performance. Driven by a robust order book and strategic project execution, the company projects over 30% year-on-year growth and margin expansion, cementing its leadership in India's oil and gas support services.

Driving Growth Through Strategic Execution

Deep Industries is poised for sustained growth, forecasting over 30% year-on-year revenue increase for the next two to three years, backed by its substantial Rs. 3,051 crore order book. This strong outlook is propelled by effective execution of diverse contracts. Management emphasized,

“similar kind of growth is expected over a period of time. And for at least next 2 to 3 years, we should continue to grow with the same kind of pace.”

Key drivers include the Rajahmundry field enhancement, expected to yield around INR 140 crores annually from H2 FY26, and new Oil India workover rig contracts totaling Rs. 141.72 crores. The Prabha barge also commenced revenue generation in May 2025, further diversifying income streams.

Enhancing Profitability and Expanding Capabilities

The company anticipates improved operating margins beyond the current 40-45% EBITDA range, particularly from new contributions. The acquired Dolphin business is projected to significantly boost overall margins, with its contracts generating over 60% gross margin and an estimated INR 100 crores annual revenue. Deep Industries plans strategic capital expenditure of INR 70-80 crores in FY26 for production enhancement and eyes INR 350-400 crores for Dolphin fleet expansion, focusing on adding 1-2 tugs and 1-2 high-revenue vessels (DSV/PSV). This prudent capital allocation, combined with efficient cost structures and a confident approach to recovering over INR 350 crores in old receivables, underpins their long-term value creation strategy.

Deep Industries Limited demonstrates a clear roadmap for sustained expansion. With strong contract execution, strategic investments in fleet and technology, and an improving margin profile, the company is well-positioned to capitalize on India's growing energy demand. Its focus on operational efficiency and value-accretive opportunities points to a resilient and profitable future.

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