Automotive thermal solutions major Subros Limited has clinched a significant new contract from Indian Railways, marking a strategic expansion into the maintenance services domain. The company announced on Thursday, December 4, that it secured a comprehensive annual maintenance contract (AMC) valued at ₹52.18 crore for the HVAC units in locomotive cabs.
A Strategic Expansion into Services
This order represents a pivotal shift for Subros, which is already a well-established supplier of air-conditioning systems for both driver cabins and passenger coaches to the national transporter. With this win, the company successfully diversifies its revenue stream by entering the service and maintenance segment alongside its core manufacturing and supply business for Indian Railways.
The company clarified in its regulatory filing that the contract is scheduled for execution over a period of three years. It also made a crucial disclosure, stating that neither its promoters nor promoter group companies have any interest in the entity that awarded the order, confirming that this is not a related-party transaction.
Financial Impact and Segment Growth
This latest order has substantially bolstered Subros's order book in the railway vertical for the current financial year. The cumulative order booking for the Railways segment now stands at ₹86.35 crore for FY25, encompassing both supply orders and this new maintenance contract.
The company's recent financial performance provides a strong backdrop for this business expansion. For the quarter ending September 2025 (Q2 FY26), Subros reported a revenue of ₹880 crore, showing growth from ₹828 crore in the same quarter last year. Its operating profit, or EBITDA, rose to ₹88 crore from ₹82 crore in Q2 FY24, while the EBITDA margin remained steady at 10%. Net profit for the quarter saw an increase to ₹41 crore, compared to ₹36 crore a year ago.
Market Performance and Future Roadmap
Subros shares have experienced notable volatility recently. After a spectacular 94% surge over a six-month period, the stock underwent a correction, declining by about 21% in the last two months due to profit booking. Despite this pullback, the stock has delivered a year-to-date return of 41% and is on track to post gains for the third consecutive year. Remarkably, the stock has generated a staggering return of approximately 3,100% over the last 12 years.
Looking forward, the company's strategic focus areas include aggressive business expansion within the commercial vehicle segment, covering buses, rail, and trucks. It is also actively exploring emerging opportunities in the green mobility space, including electric vehicles (EVs), strong hybrid electric vehicles (SHEVs), and CNG-based systems.
