Mishra Dhatu Nigam Limited (NSE: MIDHANI), the strategic defence PSU specializing in superalloys and special steels, reported a robust set of numbers for the third quarter ended December 31, 2025. While the company delivered double-digit top-line growth and a sharp sequential recovery in profits, the stock’s reaction remained muted, reflecting investor caution over premium valuations and margin compression.
Financial Snapshot: A Quarter of Recovery
After a subdued first half of the fiscal year, MIDHANI’s execution engine roared back to life in Q3. The company reported a standalone net profit of ₹27.46 crore, an 8.67% increase year-over-year. More importantly, on a sequential basis, profits surged 113% from the ₹12.96 crore reported in Q2, signaling that the operational bottlenecks faced earlier in the year are easing.
| Metric | Q3 FY26 | Q3 FY25 | YoY Change | Q2 FY26 | QoQ Change |
| Revenue | ₹275.66 Cr | ₹237.97 Cr | +15.8% | ₹209.73 Cr | +31.4% |
| EBITDA | ₹54.64 Cr | ₹53.28 Cr | +2.5% | ₹33.07 Cr | +65.2% |
| EBITDA Margin | 19.9% | 22.4% | (250 bps) | 15.8% | +410 bps |
| Net Profit | ₹27.46 Cr | ₹25.27 Cr | +8.7% | ₹12.96 Cr | +113.2% |
| EPS | ₹1.47 | ₹1.35 | +8.9% | ₹0.69 | +113.0% |
Top-Line Growth: Revenue from operations grew nearly 16% YoY to ₹276 crore, driven by faster clearance of the order backlog in the aerospace and space verticals.
Margin Pressure: Despite the revenue bump, operating margins (EBITDA) contracted by 250 basis points YoY to 19.9%. This was primarily attributed to a 14% sequential rise in employee costs, a common trend across defence PSUs as they ramp up specialized workforce retention efforts.
Operational Highlights & Order Book
MIDHANI remains the backbone of India’s strategic material needs, supplying critical alloys for programs like Gaganyaan, fighter jets (Tejas), and missile systems.
Order Book Visibility: As of January 1, 2026, the company’s order book stood at ₹2,440 crore.
Recent Wins: Post-quarter, the momentum continued with a significant ₹158 crore order win announced in early February, pushing the total open order position to nearly ₹2,590 crore. This provides revenue visibility for approximately 2.5 years at the current run rate.
Production Value: The Value of Production (VoP) for the quarter rose 18.1% to ₹304 crore, indicating that the shop floor is humming with activity to meet delivery timelines for the Ministry of Defense (MoD) and ISRO.
Stock Performance & Investor Sentiment
Despite the “beat” on sequential earnings, MIDHANI shares traded weakly, slipping 2% post-results to hover around the ₹360 levels.
Why the muted reaction?
Valuation Premium: Trading at a Trailing Twelve Month (TTM) P/E of ~64x, MIDHANI commands a steep premium compared to the broader industrial sector average of ~28x. Investors appear to be pricing in aggressive growth that the current single-digit YoY profit growth does not fully justify.
9M Performance Lag: On a cumulative basis (9 Months FY26), turnover is virtually flat compared to the previous year (₹655 Cr vs ₹663 Cr), leaving the company with a heavy lifting task in Q4 to show full-year growth.
Key Takeaways
The successful delivery of specialized titanium and superalloys for the upcoming phases of India’s space missions remains a critical monitoring point.
The company continues to modernize its facilities to handle “wide plate” production, a high-margin segment with applications in naval defense.
Conclusion
MIDHANI’s Q3 FY26 results are a classic case of “Operational Recovery vs. Valuation Gravity.” The company has successfully navigated the execution challenges of H1, and the order book remains healthy. However, for the stock to break out of its current consolidation, MIDHANI needs to demonstrate not just revenue booking, but a structural improvement in margins back toward the 24-25% range.