Zen Technologies shares tumble over 10% after weak Q1 earnings, margin pressure

Shares of Zen Technologies Ltd. fell more than 10% in early trade on Monday, July 27, after the defence technology company reported a weak set of June quarter earnings, hurt by slower execution and a sharp decline in profitability.For the quarter ended June 2026, the company reported a net profit of ₹34.4 crore, down 27.8% from ₹48 crore a year ago. Revenue declined 10.5% year-on-year to ₹141.6 crore from ₹158.2 crore.

Operating performance also weakened, with EBITDA falling 40.2% to ₹38.7 crore from ₹64.7 crore in the year-ago period. EBITDA margin contracted sharply to 27.3% from 40.9%.

The weak profitability was driven by a rise in operating costs. Employee expenses increased to 24% of revenue from 20% a year earlier, manufacturing costs rose to 9% from 5%, while other expenses nearly doubled to 21% from 10%.The company’s order book stood at ₹1,239.02 crore as of June 30, 2026, down about 7% from the end of FY26. Management expects execution to gather pace from the second quarter, supported by fresh order inflows.

Zen Technologies’ order book has remained volatile over the last few years. It stood at ₹473 crore at the end of FY23, rose to ₹1,402 crore in FY24, declined to ₹692 crore in FY25, and recovered to ₹1,336 crore by the end of FY26.

Separately, the company announced the launch of a High-Altitude Man-Portable Anti-Drone System, designed for modern mountain warfare.