Thermax: green hydrogen partnerships are real, but earnings?

Thermax (NSE: THERMAX) provides energy and environmental solutions to industry. It reported consolidated operating revenue of Rs 2,303 crore in Q1 FY27 (+6.7% YoY), but PAT fell 85.4% to Rs 22 crore. What happened: The PAT collapse was not hydrogen-related; a Rs 91-crore cost-to-complete revision on one Industrial Infrastructure project drove most of the decline. Industrial Products contributed Rs 1,058 crore revenue and Rs 64 crore profit; Industrial Infrastructure posted a Rs 71-crore loss; Chemicals earned Rs 26 crore on Rs 230 crore revenue. Green Solutions revenue was Rs 245 crore (+3% YoY) with a loss before tax of Rs 17 crore. Thermax signed an India partnership with HydrogenPro (Norway) for alkaline electrolysis in August 2025 and is developing a 720 kW SOEC pilot with Ceres Power (UK). Management confirmed in July 2026 a hydrogen order agreed in principle but not yet booked; revenue only from FY28. Why it matters: India's National Green Hydrogen Mission targets 5 MTPA by 2030, but only around 8,000 TPA was operational as of early 2026. The Green Solutions order book rose 17% YoY to Rs 1,568 crore. Kotak upgraded Thermax to Buy on 9 October 2026 with a Rs 4,000 target, citing data centres and biogas, not hydrogen. What I am watching: Confirmation of the hydrogen order next quarter, Green Solutions moving to breakeven, and Industrial Infrastructure margin recovery. My stance: At 70.5x PE, the market prices in a multi-year growth story across hydrogen, data centres and biogas. The core is sound, but Q1 shows how a single large project can compress consolidated profit sharply. Hydrogen revenue arrives no earlier than FY28. I do not hold a position in Thermax at the time of writing. This is not investment advice.