Why Quality Power shares fell over 6% today despite strong Q4 results

Quality Power Electrical Equipments shares fell over 6% on Thursday, May 14, despite the company reporting strong growth in Q4 FY26 revenue and net profit.

The stock was trading at Rs 1,138.80, down 6.35% or Rs 77.20 as of 9:43 AM. Quality Power opened lower and moved in a day range of Rs 1,096.20 to Rs 1,158.00. The previous close stood at Rs 1,216.00.

The company reported standalone net profit of Rs 164.83 million for the quarter ended March 31, 2026, compared with Rs 85.09 million in the corresponding quarter last year. Standalone revenue from operations rose to Rs 708.86 million, compared with Rs 442.33 million in Q4 FY25.

On a consolidated basis, revenue from operations rose to Rs 2,808.08 million in Q4 FY26, compared with Rs 1,083.23 million in the year-ago quarter. Consolidated net profit stood at Rs 505.51 million, compared with Rs 305.01 million in Q4 FY25.

However, the stock came under pressure as investors appeared to focus on margin contraction and certain operational updates. The company’s Q4 EBITDA stood at Rs 303 million, compared with Rs 163 million a year ago, but EBITDA margin declined to 10.79% from 15.10% in the corresponding quarter of the previous year.

The company also said its step-down foreign subsidiary Endoks Enerji Anonim Şirketi in Turkey recorded a net monetary loss of Rs 257.39 million due to the impact of inflation under Ind AS 29, which was recognised under other expense.

Quality Power also announced that production commencement at its Sangli Plant has been marginally rescheduled due to raw material and labour availability constraints arising from the prevailing geopolitical situation. Production is now expected to begin in the first week of August 2026.

The Board recommended a final dividend of Rs 1 per equity share for FY26, subject to shareholder approval. The company also received enabling authorisation to raise funds up to USD 75 million through permissible routes for international expansion, acquisitions, mergers, technology investments and capacity augmentation.

Overall, Quality Power shares moved lower even after strong revenue and profit growth, as investors reacted to lower EBITDA margin, inflation-related expense at the Turkey subsidiary, Sangli plant rescheduling and the proposed enabling fundraise.

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