Thermax’s expectation of about 22 per cent revenue growth in FY27 is more than a corporate target. It is a signal of how India’s infrastructure expansion is shifting demand towards the less visible systems that make new capacity work: boilers, cooling equipment, water treatment, wastewater recycling and industrial energy controls.
The Pune-based engineering company expects revenue to approach ₹13,000 crore in FY27, up from ₹10,694 crore last year, according to industry sources cited by The Hindu BusinessLine. The expectation is supported by a ₹14,045-crore order book, demand from infrastructure projects and data centres, and a growing export business. Thermax’s management has also identified domestic power, energy transition projects, overseas markets and industrial water systems as areas for expansion.
That combination places the company within a critical layer of the built environment. Thermax does not construct cities in the conventional sense. It supplies systems that determine whether industrial plants can generate heat and power, whether data centres can manage intense cooling loads, and whether water-intensive facilities can treat and reuse their wastewater. As investment moves towards digital infrastructure and advanced manufacturing, these systems become central to the reliability of urban and industrial growth.
The company’s projected acceleration follows a slower FY26. Consolidated revenue grew 3.64 per cent to ₹10,694 crore, while consolidated profit increased 15 per cent to ₹720 crore. Revenue in the June quarter rose 7 per cent to ₹2,303 crore. Profitability, however, was affected by a ₹91-crore cost revision on a legacy infrastructure project, highlighting the exposure engineering companies face when long-duration contracts are priced before material, labour and execution conditions are fully known.
This tension between a large order book and uneven conversion is important. Thermax’s order book grew 23 per cent year on year, but geopolitical disruptions delayed overseas equipment deliveries and domestic project execution. A backlog is therefore not the same as completed infrastructure or recognised revenue. The company’s ability to convert orders into sales will depend on procurement, delivery schedules, project execution and the terms under which contracts were signed.
Thermax’s management is responding by becoming more selective about long-duration, fixed-price construction contracts. Ashish Bhandari, the company’s managing director and chief executive officer, told The Hindu BusinessLine that rising costs create execution risks in such projects. The issue is not unique to one company. Fixed-price contracts transfer a substantial part of inflation and delay risk to engineering and construction firms, particularly when projects take several years to complete. When costs rise faster than contract prices, a strong order book can coexist with pressure on margins and cash flows.
The company’s financial position offers some room to manage that pressure, although it does not remove execution risk. Thermax held ₹2,467 crore in cash, bank balances and current investments against borrowings of ₹2,288 crore at the end of March. Its operating cash flow stood at ₹542 crore in FY26, reflecting higher project retention and lower customer advances. These figures show the importance of working capital in infrastructure supply chains: revenue growth must be matched by the timely collection of project payments and the management of advances, retention amounts and procurement costs.
Data centres are emerging as one of the clearest demand drivers. Thermax has secured two significant orders from the United States data-centre market, including one worth more than ₹400 crore for boiler pressure parts and another for absorption chillers for facilities with captive power generation. These orders illustrate that data-centre infrastructure is not limited to servers, fibre networks and buildings. It also requires dependable thermal systems, backup and captive power arrangements, and equipment capable of operating continuously under demanding conditions.
The urban significance of this demand lies in the resource intensity of digital infrastructure. A data centre occupies a relatively concentrated physical footprint, but its operation depends on reliable electricity, heat management and water systems. Thermax’s involvement in boilers and absorption chillers places it in the equipment chain that supports this reliability. The supplied material does not establish the total national demand for these systems or the environmental performance of individual facilities, but it does show how data-centre investment is opening a new market for industrial engineering companies.
The company is also identifying opportunities around hybrid cooling towers, water treatment, chemicals and wastewater recycling for semiconductor plants and other water-intensive industries. This matters because the next phase of industrial investment will require more than land and electricity. Facilities must manage process water, cooling requirements and wastewater within increasingly complex operational systems. For cities and industrial regions, that creates a direct link between investment promotion and the availability of utilities that can be delivered reliably and managed efficiently.
Thermax’s new intelligent boiler and heater range, Thermax-i, is positioned around this efficiency challenge. Its first product, UltraPac-i, uses the company’s proprietary EDGE Control technology to adjust to changing fuel characteristics and operating conditions. Pilot installations demonstrated fuel savings of up to 10 per cent, and the technology can be retrofitted to suitable existing boilers. These claims are attributed to the company’s product and pilot experience; the supplied material does not provide independent validation or details of the number and type of installations.
Even with that limitation, the product direction is significant. Retrofitting existing industrial equipment can be less disruptive than replacing entire systems, particularly where plants are already operating and cannot easily pause production. Automatic adjustment to fuel and operating conditions also reflects a broader shift in industrial infrastructure towards more responsive control systems. The value for users will ultimately depend on actual fuel savings, maintenance requirements, operating conditions and the cost of installation, none of which are detailed in the supplied report.
Thermax’s experience in bio-CNG presents a different side of the energy-transition story. Bhandari said the business had faced nearly three years of technological challenges involving agricultural residue, moisture management and gas purification. He described the process of moving from small-scale to large-scale operations as a period of learning and said stronger government support for pricing and operational efficiency could help the business improve.
That account shows why technology transitions often move unevenly. A policy objective may create demand for cleaner fuels, but commercial viability still depends on feedstock quality, processing systems, pricing and the ability to operate consistently at scale. In bio-CNG, the problem is not simply whether agricultural residue is available. It is whether the material can be handled and purified in a way that supports dependable production and a workable business model.
Exports are another important part of Thermax’s growth strategy. International revenue increased 33.4 per cent to ₹3,084 crore in FY26 and accounted for about 29 per cent of total sales. Overseas orders represented roughly 30 per cent of the backlog. Bhandari said the company was becoming systematically qualified with large Middle Eastern oil and gas companies after previously lacking access to many of those opportunities.
The figures point to a company attempting to balance domestic infrastructure demand with international diversification. Export growth can broaden the customer base and reduce dependence on one market, but it also exposes the business to geopolitical disruption, overseas qualification requirements, logistics constraints and different project standards. The reported delays in overseas equipment deliveries demonstrate that international expansion does not eliminate execution risk; it changes the nature of that risk.
The company’s FY27 expectation also sits above an external estimate cited in the report. PL Capital forecasts revenue of ₹12,286 crore, implying approximately 15 per cent growth, while management’s expectation is close to ₹13,000 crore. The difference is not evidence that either figure will be achieved. It does, however, underline the uncertainty involved in converting a growing backlog into revenue, especially when project timing and contract economics remain sensitive to delays.
For the urban economy, the wider lesson is that infrastructure growth is increasingly dependent on specialised suppliers operating behind the headline project. A data centre, semiconductor plant or industrial facility may be announced as a building or investment project, but its performance depends on a network of equipment manufacturers, contractors, utilities and service providers. Delays or cost overruns in one layer can affect the delivery and operating economics of the entire asset.
This also makes project contracting a governance issue, not only a corporate one. Long-duration fixed-price contracts can make project costs appear predictable at the award stage while leaving engineering companies exposed to later changes. Thermax’s decision to become more selective is a commercial response, but the underlying challenge concerns how infrastructure projects allocate risk, price contingencies and manage changes during execution. The supplied material does not identify specific policy changes or contract reforms, so the broader institutional implications remain an area for further reporting rather than a settled conclusion.
Thermax’s numbers confirm strong demand across data-centre equipment, industrial cooling, water treatment, exports and energy-efficiency systems. They also show that growth will be tested by revenue conversion, legacy project costs, logistics, contract design and the operational complexity of new energy technologies. The company’s next phase will therefore be measured not only by the size of its order book, but by how effectively it turns that backlog into completed systems, stable cash flow and equipment that performs under real industrial conditions.
