Tembo Global Industries has set a clear revenue target for FY27. The company expects its revenue to reach about ₹1,600 crore, which means growth of around 30% to 40% from FY26. The target comes after a strong year in which the company saw a sharp rise in revenue, EBITDA and profit.
But the bigger story is not just the FY27 target. Tembo Global is also preparing for a major expansion into the defence business. The company expects defence revenue to start late in FY27 and has now shared a much larger outlook for its first full year of defence operations.
This gives the company two separate growth drivers. The first is its existing engineering and EPC business. The second is the new defence vertical, which could bring much higher profit margins once it reaches scale.
FY26 Gave the Company a Strong Base
Tembo Global entered FY27 after a strong FY26. Revenue rose 46.7% to ₹1,090 crore. EBITDA increased 55.4% to ₹142.5 crore, while PAT rose 79.7% to ₹98.2 crore. EBITDA margin stood at 13.1%, while PAT margin reached 9.0%.
The numbers show that profit grew faster than revenue. This is important because it suggests that the company had better profit control as its business size increased.
The FY26 performance also gives some support to the FY27 revenue goal. Still, the next step is larger. A rise from ₹1,090 crore to about ₹1,600 crore means Tembo needs to add more than ₹500 crore of revenue within one year.
Management expects the engineering business to remain the main source of this growth. The company has an order book of about ₹1,548 crore and a bidding pipeline of more than ₹2,200 crore.
Engineering Business Remains the Main Driver
For FY27, Tembo Global is not relying only on its new defence plans. Its core engineering business remains central to the revenue target.
The company works across areas such as engineering products, EPC projects, oil and gas, marine and water-related projects. Its existing order book gives it a base for future sales, while the large bidding pipeline offers more room for fresh orders.
The company has also been raising its manufacturing capacity. Its engineering capacity is set to rise from 18,000 MTA to 1,00,000 MTA over the next two to three years. This higher capacity should help Tembo handle larger orders as demand rises.
Tembo has also qualified as the L1 bidder for a Kuwait offshore revamp project worth about ₹300 crore. The company has other opportunities in port construction and fuel farm systems as well.
This means the FY27 story has a fairly broad base. Engineering, EPC, exports and solar can all add to the top line, while defence is expected to become more important toward the end of the year.
Defence Could Change the Profit Picture
The defence business is the most important new part of Tembo Global’s growth plan.
The company has entered defence manufacturing through its subsidiary. It has secured licences for small arms and ammunition production. The plan is to set up a manufacturing base and then raise output over time.
Management expects the defence business to start its revenue contribution around Q4 FY27. It has estimated that defence could account for about 5% to 10% of FY27 revenue, which would put the contribution at roughly ₹80 crore to ₹160 crore based on the ₹1,600 crore target.
The contribution in FY27 may therefore remain limited because the business will only have a short part of the year to operate. The bigger opportunity comes in FY28.
FY28 Defence Guidance Is the Bigger Story
Tembo Global has given a strong forecast for the first 12 months of its defence operations.
Management expects the defence business to generate ₹300 crore to ₹400 crore of revenue in its first full 12 months. At the same time, it expects ₹170 crore to ₹180 crore of PAT, including depreciation. The company has also stated that defence could deliver a 30% to 35% PAT margin once the business reaches scale.
These numbers are much higher than the margin level of the existing business.
For context, Tembo expects the overall group, excluding the special benefit from defence, to maintain a PAT margin of around 10% to 12% in FY27. A defence business with a 30% to 35% PAT margin could therefore have a large effect on the group’s profit profile if the forecast becomes reality.
This is why the FY28 outlook matters more than the small defence contribution expected in FY27.
Solar Adds Another Growth Layer
Defence is not the only new area at Tembo Global. The company is also building a solar business.
Tembo has plans across 28 sites, with several sites close to commissioning. The company expects all the sites to become operational around the end of Q2 or the start of Q3 FY27. The total solar project cost has been put at around ₹600 crore, with about ₹300 crore already spent.
Commercial operations from the solar projects could provide another source of revenue as FY27 progresses.
This creates an interesting mix for the company. Engineering provides the existing base, solar adds a new business line, and defence could become the high-margin growth engine.
Debt and Capital Needs Need Attention
Fast expansion also comes with financial risks. Tembo Global expects to add about ₹300 crore to ₹350 crore of debt in FY27. The funds are expected to support solar, defence and working capital needs.
The company has said that, as of now, it does not plan further major capital expenditure for FY28. That could help reduce the pressure for another large round of spending after the current projects reach the next stage.
However, investors still need to watch how quickly the new projects start to generate cash. Revenue growth alone is not enough. The company must also convert its reported profits into cash while keeping debt under control.
Execution Will Decide the Outcome
The targets are strong, but they are still management forecasts. The biggest question is execution.
The ₹1,600 crore FY27 revenue goal depends mainly on the engineering business and the successful start of newer areas. The defence forecast depends on factory readiness, production, customer orders and the ability to reach the expected output.
The first full year defence target of ₹300 crore to ₹400 crore revenue and ₹170 crore to ₹180 crore PAT is especially important because it assumes a very high level of profitability. The company will need to prove that these margins can hold after production starts at scale.
There is also a long-term target of ₹20,000 crore revenue by 2030. That is a very ambitious goal compared with the current size of the company. Management has said it plans to provide more details on the expansion path year by year.
What Investors Should Watch
The next few quarters should give a clearer picture of whether Tembo Global can meet its FY27 target.
The first point to watch is order conversion. The company has a ₹1,548 crore order book and a bidding pipeline above ₹2,200 crore, but new orders must turn into actual revenue.
The second point is solar execution. The company expects its sites to become operational around Q2 and Q3 FY27.
The third and most important point is defence. Investors will want to see the facility move from setup to actual production and then to regular sales.
Finally, debt and cash flow will remain important. A growing company can create strong value if its new projects produce healthy cash returns. If project delays or cost increases occur, the same expansion can place pressure on the balance sheet.
Conclusion
Tembo Global Industries is entering FY27 with a much larger growth plan. The company expects ₹1,600 crore revenue, backed mainly by its engineering business, while solar and defence add new sources of growth.
The defence business is the most exciting part of the story. FY27 may see only a small contribution, with about 5% to 10% of revenue expected from defence. But FY28 could be very different. Management expects the first full year of defence operations to deliver ₹300 crore to ₹400 crore revenue and ₹170 crore to ₹180 crore PAT, with a 30% to 35% PAT margin.
The opportunity is therefore large, but so is the need for execution. Tembo must expand capacity, start new projects, win orders and manage its higher debt without losing financial discipline.
For investors, the key story is simple: FY27 is about proving growth, while FY28 could show whether defence can change the company’s profit profile.
