Q2 FY27 · NSE: NETWEB

Netweb Technologies India

Results filed 24 October 2026 · Market cap ₹24,805 crore · PE 67.8

GrowthGuidance introducedTranscript read

Revenue: +335.7%; on a year ago
EBITDA: +334.0%; on a year ago
Profit to shareholders: +334.8%; on a year ago
EBITDA margin: 14.9%; +0.2 pts on last quarter

Netweb Technologies reported record Q2 FY27 performance with revenue growing 335.7% YoY to ₹1,323 crore and PAT rising 334.8% YoY to ₹137 crore, driven by 10x growth in AI Systems. The order book stood at ₹2,629 crore with an additional L1 position of ₹653 crore, supporting management's FY27 revenue target of ₹4,000 crore. Working capital expanded as inventory days stretched to 117 days to support order fulfillment, while top-5 customer concentration increased sharply to 76.5% in H1 FY27.

Netweb Technologies India Limited, Q2 FY27₹ crore, standalone

	Q2 FY27	Q1 FY27	vs previous quarter	Q2 FY26	vs a year ago
Revenue	1,323	820	+61.4%	304	+335.7%
Operating profit (EBIT)	194	117	+65.2%	42.03	+360.6%
Operating margin	14.6%	14.3%	+33 bps	13.8%	+79 bps
Other income	12.86	8.47	+51.8%	0.92	+1297.8%
Exceptional items	0	0	–	0	–
Profit before exceptional items and tax	183	114	+60.0%	42.03	+334.6%
Profit to shareholders	137	85.32	+60.2%	31.43	+334.8%
Earnings per share (₹)	23.54	14.98	+57.1%	5.55	+324.1%

Source: Netweb Technologies India Limited’s filing to NSE, 24 October 2026. Operating profit is revenue less every expense except interest, so it leaves out other income and exceptional items. n.m.: not meaningful, because the earlier figure was zero or negative, or the latest one is a loss.

What stood out

Massive quarterly revenue surge of over 4x YoY led by AI systems
Source
In Q2 financial year '27, revenue from operations grew at a rate of 335.7% year-on-year to INR1,323 crores... AI systems remained our primary growth driver, contributing INR773 crores or 58.4% of revenue from operations, registering a growth of 1,068.1% year-on-year (Sanjay Lodha, Transcript page 3).
Robust order book and large addressable opportunity pipeline
Source
As on September 30, 2026, our order book stood at INR2,629 crores with an additional L1 position of INR653 crores... Our active pipeline of approximately INR11,152 crores represent the total value of business opportunity currently under pursuit (Sanjay Lodha, Transcript pages 4-5).
Customer concentration increased significantly at the top end
Source
Top 5 customer concentration reached 76.5% in H1 FY27 (up from 62.2% in FY26 and 50.8% in FY25), and Top 10 customer concentration reached 85.2% (up from 76.4% in FY26) (Presentation page 13 / page 18).

Guidance

Metric	Guidance	Period
Revenue Source I can only assure you one thing that we are targeting to achieve INR4,000 crores of revenue this particular financial year (Sanjay Lodha, Transcript page 11).	Targeting INR4,000 crores for FY27	FY27
Medium-term Revenue CAGR Source we are very confident to maintaining that growth for at least next 2 to 3 years, actually... pipeline keeps on adding every day. So that gives us a confidence that basically we'll keep on growing at the same rate of 30% to 40% (Sanjay Lodha, Transcript page 12).	30% to 40% CAGR for the next 2-3 years	Next 2-3 years
Operating EBITDA Margin Source company has showcased operating EBITDA margins to remain around 14%... maintaining the EBITDA margins, what we have said that 13%, 14%, we have slightly crossed that in this H1, but not to be quoted for the entire year (Ankit Kumar Singhal, Transcript pages 8, 18).	Around 14% (13% - 14% range)	Full Year FY27
Cash Conversion Cycle Source And what we anticipate that our cash conversion cycle will operate between 90 to 110 days... So 90 to 110 is the range where our working capital cycle will operate (Ankit Kumar Singhal, Transcript page 10).	90 to 110 days range	Forthcoming year

Tailwinds

Surging domestic demand for AI infrastructure and sovereign compute
Source
The India AI mission represents a major structural tailwind for the domestic AI ecosystem with the potential to accelerate development of indigenous AI capabilities... Global service providers, CSPs, data center operators, enterprises are expanding their GPU-intensive infrastructure (Sanjay Lodha, Transcript page 4).
Strong repeat customer base
Source
Revenue from repeat customers stood at 94.4% in H1 FY27 compared to 75.6% in FY26 (Earnings Presentation page 13).
Deleveraged balance sheet post-QIP
Source
We achieved a zero net debt position during the quarter with net cash position of INR14 crores as of September 2026. In addition, the company had approximately INR403 crores unutilized from the QIP proceeds (Ankit Kumar Singhal, Transcript page 6).

Headwinds

Elongation of cash conversion cycle driven by high inventory accumulation
Source
Our cash conversion cycle stood at 94 days with receivable days improving to 62 days, while inventory days stood at 117 days [up from 86 days in Mar'26] (Ankit Kumar Singhal, Transcript page 6; Presentation page 20).
Gross margin pressure from component cost inflation and large-deal mix
Source
Gross margins have declined... component prices are up and that is adding pressure... the memory prices have gone up by 200% or maybe even more than that... when we enter into a very large-scale deals, so the profile is inherently different... gross margin becomes a game of different deal mix (Vinay Menon, Sanjay Lodha, Ankit Kumar Singhal, Transcript pages 8, 13).
Sharp increase in finance costs
Source
Finance Cost rose to INR238 million in Q2 FY27 from INR9 million in Q2 FY26, up 2459.1% YoY (Earnings Presentation page 11).

New businesses and products

capacity expansion · Board approved

Establishment of wholly owned R&D subsidiary in Taiwan

Expected benefit: Deepening R&D in IT hardware, speed up R&D capabilities, and hire local hardware design engineering talent

Source

our Board has also approved the establishment of a wholly owned subsidiary of Netweb in Taiwan for advancing our R&D efforts. This is an important step towards deepening R&D in IT hardware and strengthening our technological capabilities... So basically, we need design engineers and all that. So getting resources sometimes in India becomes a challenge... primary purpose is to have more -- to hire more manpower so that basically they can be available locally in Taiwan (Sanjay Lodha, Transcript pages 5, 7).

new product · Under development (schematics and design underway)

Vera Rubin server platform launch

Expected benefit: Offer next-generation AI platforms to customers aligned with worldwide launch timelines
Timeline: Start offering to customers by January 2027

Source

And in fact, the process of designing, writing schematics and creating the files and all that all has already started. And as a result of it, very soon, we'll be having first Vera Rubin system set up in the country... commercial... planning to basically start offering this product to be sold to the customers by January (Hirdey Vikram, Transcript page 8).

new business · Early stage R&D

Physical AI and Quantum Computing R&D

Expected benefit: Physical AI digital twins/simulation backbone; classical HPC quantum simulators and emulators for National Quantum Mission
Risks: Initial development stage, commercially speculative at this stage
Timeline: Long-term (initial development stage)

Source

In physical AI, we are developing capabilities across technology stack... In quantum computing, we have commenced R&D on quantum simulators and emulators... this is just presently in an initial development stage (Sanjay Lodha & Sanjeev Sancheti, Transcript pages 5, 17).

Things to check

Revenue up over 60%: check for an acquisition or a weak year-ago quarter
High customer concentration risk
Source
Top 5 customers accounted for 76.5% of H1 FY27 revenues and Top 10 accounted for 85.2%, up significantly from 62.2% and 76.4% in FY26 (Presentation page 13).
Substantial inventory build-up
Source
Inventory days stretched to 117 days in Sep'26 from 86 days in Mar'26 and 53 days in Mar'25, driving the cash conversion cycle up to 94 days (Presentation page 20).

How the call went

Management demonstrated strong confidence in sovereign and enterprise AI demand and order execution, providing clear guidance on FY27 revenue (~INR4,000 cr) and working capital. However, answers were guarded regarding customer-specific concentration, domestic competitive dynamics, and future technology monetization timelines.

Specific or vague: Mixed: strong operational detail on product timelines (Vera Rubin in January) and pipeline metrics, but management avoided revealing customer-specific order details, exact revenue segment splits for pipeline, and Taiwan capex numbers.
Candour: Management acknowledged gross margin compression from rising component prices (e.g., 200%+ increase in memory prices) and large-deal mix, but was somewhat dismissive of broader AI demand risks.
The hard questions: Analysts probed sharply on extreme customer concentration (Top 5 at 76.5%), discrepancies in balance sheet free cash disclosures vs filings, lack of operating leverage despite 4x scale, and timeline on physical AI monetization.

What analysts pressed on

Heavy customer concentration in top 5 and top 10 clients
Gross margin decline and lack of operating leverage in EBITDA/PAT margins
Working capital expansion and inventory buildup to 117 days
Reconciliation between presentation 'free cash' and reported balance sheet cash
Sustainability of growth post-execution of the INR2,200 crore strategic order

Answers that sidestepped

Refusal to provide segment split of the active pipeline (Sanjay Lodha: 'unfortunately, we don't share the breakup of the order book actually')
Dismissal of questions regarding competition in India (Sanjay Lodha: 'We have no idea about that')
Deflection on monetization timing for Physical AI and Quantum (Sanjeev Sancheti: 'I don't think we want to speculate on how much we can do at this point in time')

Numbers against the story

The reported 335.7% YoY revenue growth aligns well with management's narrative of unprecedented AI demand and execution of large GPU orders. However, while management highlighted operating leverage from large deals, reported operating EBITDA margin (14.9%) and PAT margin (10.2%) were flat to slightly down YoY (15.0% and 10.3% respectively in Q2 FY26) because gross margins compressed due to 200%+ memory price increases and higher deal-level scale discounts. Additionally, management emphasized customer diversification by citing 449 new customer additions in H1, yet the reported figures reveal that customer concentration rose drastically, with the top 5 customers generating 76.5% of H1 FY27 revenue compared to 62.2% in FY26.

Sources

Concall transcript · filed 29-Oct-2026
Press release · filed 24-Oct-2026
Investor presentation · filed 24-Oct-2026
Investor presentation · filed 24-Oct-2026
Figures: the company’s results filing with NSE, linked under the table.

Notes written by gemini-3.8-flash from the documents above on 1 November 2026. They summarise what the company said and can contain mistakes: check the source passage before relying on a point. Not investment advice.