Synopsis: Swaraj Engines Limited has reported its best financial year on record for FY2026. FY annual revenue of Rs. 2,007.13 crore (up 19.3 percent YoY), all-time high PBT of Rs. 266.98 crore, PAT of Rs. 196.31 crore (up 18.3 percent), and engine sales crossing the 2,00,000-unit milestone for the first time, while recommending a dividend of Rs. 110 per share (1100 percent), marking the 6th consecutive year of volume and profit growth.
A Mohali-based diesel engine manufacturer came into focus on April 13, 2026, after its board approved audited results for the fourth quarter and full year ended March 31, 2026, alongside a dividend recommendation, delivering an unbroken streak of sixteen consecutive quarters of year-on-year profit growth and six consecutive years of rising engine sales.
With a market capitalization of approximately Rs. 4,761.29 crore, the shares of Swaraj Engines Limited were trading at Rs. 3,918.80 per share, down 0.44 percent from its previous close of Rs. 3,936.30. It is trading at a P/E of 25.55.
Annual engine sales crossed the 2,00,000-unit threshold for the first time in the company’s history, reaching 2,02,771 units against 1,68,820 units in FY2025, a 19.3 percent volume surge. Net operating revenue for FY2026 was Rs. 2,007.13 crore, up 19.3 percent from Rs. 1,681.89 crore. PBT before exceptional items reached Rs. 266.98 crore while PAT at Rs. 196.31 crore, up 18.3 percent, is similarly a record. Full-year basic EPS stands at Rs. 161.60 versus Rs. 136.64 in FY2025.
Q4 FY26 was independently the company’s strongest quarter on record across every metric. Engine sales of 55,004 units surpassed Q4 FY25’s 45,594, a 20.7 percent jump. Net operating revenue for the quarter was Rs. 545.79 crore (up 20.1 percent YoY), PBIT of Rs. 69.59 crore (up 22.9 percent), PBT of Rs. 73.19 crore (up 19.6 percent), and PAT of Rs. 54.56 crore (up 20.1 percent).
The board has recommended Rs. 110 per share (1100 percent on face value of Rs. 10) for FY2026, up from Rs. 104.50 per share in FY2025. The payout is subject to shareholder approval at the 40th AGM scheduled for July 20, 2026, with a record date of July 3, 2026. At Rs. 3,736 per share, the recommended dividend translates to a yield of approximately 2.9 percent.
Balance Sheet and Capital Deployment
Two numbers in the FY2026 balance sheet deserve attention. Capital work-in-progress has surged from Rs. 4.77 crore to Rs. 54.81 crore, an eleven-fold jump indicating a significant capacity expansion programme underway. Simultaneously, fixed asset purchases in FY2026 at Rs. 69.79 crore were nearly three times the Rs. 24.46 crore spent in FY2025. The company is investing well ahead of its historical capex run-rate, signalling management conviction in sustained volume growth.
Operating cash flow, however, declined from Rs. 176.67 crore in FY2025 to Rs. 116.52 crore in FY2026, despite higher profits. The gap is explained primarily by a Rs. 12.17 crore increase in trade and other receivables and higher working capital deployment. This is not a concern in isolation, but the trajectory of receivables days bears watching in FY2027 as volumes scale further. The company remains debt-free, with borrowings limited to small lease liabilities.
Business Overview
Incorporated in 1985, Swaraj Engines Limited is a Mohali, Punjab-based manufacturer of diesel engines for tractors, operating as a subsidiary of Mahindra & Mahindra Limited (promoter holding: 52.1 percent). The company supplies engines in the 20 HP to 65 HP range exclusively to the Swaraj Division of M&M.
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