SEAMEC Ltd Q3 FY2026 Concall Summary

Key Takeaways

• Record quarter, one-off boost: Highest-ever vessel deployment drove best-ever revenue and profitability, but roughly INR22 crores of the Q3 performance came from a single contract taken over from HAL Offshore, a benefit that will not repeat.
• Q4 resets lower: Seamec Paladin entered a 70-day statutory dry dock in Dubai, so management explicitly guides for lower revenue and profitability next quarter and asks investors to look year-on-year, not quarter-on-quarter.
• Fleet expansion is the FY27 story: Three vessels will add full-year or first-time revenue next year: Swordfish (full-year vs part-year), Agastya (already operating), and Anant (acquisition expected to close in Q4, deploy in Q1 FY27). Management calls next year "a year of growth."
• INR1,000 crore MOU signals ambition but lacks detail: A commitment to acquire one or more vessels over 2-3 years is signed with DG Shipping, but vessel type, capacity, funding mix and approval timeline were all left open.
• What to watch next quarter: Whether the Anant acquisition closes on time, the actual Q4 revenue drop from Paladin's dry dock, and any concrete vessel identification under the MOU.

Quarterly Performance: The Record and the One-Off

• Highest-ever deployment: Q3 marked the highest vessel deployment in company history, translating directly into record quarterly revenue and profitability.
• Goodman contract windfall: A vessel named Goodman, owned by HAL Offshore, had its contract taken by Seamec. Seamec took the vessel on rent, performed the work, and earned a benefit of almost INR22 crores in Q3 after marginally paying HAL Offshore for rentals. This was the single factor that made the quarter exceptional.
• Platform revamp completed ahead of schedule: The turnkey revamping of ONGC's NLM9 platform finished well ahead of schedule during the quarter.
• Vessel deployment timeline: Seamec III sailed for the second phase of the Pipeline Replacement Project and DSF II projects effective 25th December 2025. Seamec Agastya commenced operations with ONGC through HAL Offshore after completing dry docking.
• All other vessels operational: Seamec II, Seamec III, Seamec Princess, Seamec Glorious, Seamec Diamond, and Seamec Agastya are all working. Any material breakdown or off-hire affecting revenues materially is intimated to stock exchanges.
• Prior breakdown resolved: A breakdown from last quarter has been addressed. Clients understand machinery is prone to breakdown; there has never been any concern from the client, and no penalty or compensation is being imposed.

Sunil Gupta: "See, we always tell our investors while we are in the process of consolidating business. But this is a business where investors should look on year-to-year growth than quarter-to-quarter."

Q4 Headwind: Paladin Dry Dock

• 70-day statutory dry dock: Seamec Paladin sailed to Dubai for statutory dry docking expected to last approximately 70 days, covering roughly two months of Q4. Management explicitly guides for lesser revenue and profitability in the quarter.
• FY27 dry docks timed for monsoon: Three vessels (Seamec III, Seamec Princess, Seamec Glorious) will undergo dry dock during the monsoon period next year, carrying very little chance of revenue disruption.
• Anant not due for dry dock: Management confirmed Anant is not due for dry dock now or next year, so no deployment delay from that source.

Fleet Expansion: The FY27 Growth Engine

• Three-vessel addition: Next year's growth rests on Swordfish working a full year (it was part-year this year), plus Agastya already operating, plus Anant expected to deploy in Q1 FY27. Management states flatly: "Next year will be a year of growth."
• Anant acquisition status: Board approval, shareholder approval, and ONGC approval are all in place. Shareholder approval for enhancement of related-party transaction limits was received in October/November. Management is confident of closing the acquisition in Q4 and deploying the vessel in Q1 FY27.
• Anant funding: A 50-50 mix of own funds and term loan, with the loan tenure of 5 to 8 years to be decided at disbursement.
• MOU with DG Shipping: Seamec signed an MOU committing investment of almost INR1,000 crores over the next 2-3 years toward targeted acquisition of one or more vessels. Funding will be decided case-to-case once an acquisition is zeroed in, with the best possible decision taken on whether to use entirely internal accruals or a mix.
• No age-norm pressure: The majority of Seamec's vessels (diving support vessels) have been kept out of the purview of DG Shipping age norms. No age criteria restriction applies for operating these vessels in India.

Sunil Gupta: "First of all, next year will be a year of growth because we expect the Swordfish to continue working full year. This year, it was part of the year. We are also adding Agastya and Anant, as we mentioned in the previous discussion. So all these new vessels will give us more business and will definitely give us growth."

Charter Rates and Contract Mix

• Rate sustainability expected: Management feels the environment will remain quite steady and current charter rates will sustain for some more time. Most contracts are long-term, with some short-term, providing steady revenue visibility.
• Rate variation explained: Rates differ per contract based on vessel capabilities (cranage, accommodation, size), scope of work, risk perception (chances of off-hire), and market conditions at the time of fixing. Swordfish commands a higher rate than Anant because of better capabilities.
• IMR preference is structural: The company is inclined toward IMR contracts because they provide deployment for the full year with no off-hire period, monsoon included. Two older-vintage vessels cater to EPC business. Any new asset acquired is assumed on an IMR contract because high-value assets become profitable only on IMR.
• Off-hire risk not insured: High-value charter rates are not normally covered by insurance, or if covered, the premium is quite huge. Instead, a risk element is added into the rate when bidding, and a contingency margin is kept for breakdown.

Sunil Gupta: "Any new business or any new asset that is acquired is assumed on a IMR contract because see, these vessels are high-value assets, okay? As you also said and investors understand that IMR gives higher margins. So these vessels become profitable only when we put on IMR."

HAL Offshore Relationship and Business Migration

• Goodman contract structure: Seamec took the contract from HAL Offshore, took the vessel on rent from HAL Offshore, performed the work, and earned exceptionally well in Q3 by marginally paying HAL Offshore for rentals.
• No royalty to parent: There is no royalty paid to HAL Offshore. Instead, there is a revenue share, with some part of the scope done by the parent and some by Seamec.
• Future contracts to migrate to Seamec: Going forward, as new contracts come, the company will try to bid them in Seamec and increase Seamec's share of business. Gradually, HAL Offshore's business will deplete by the expiry of its contracts. Management committed to building most new businesses in Seamec only.

Sunil Gupta: "And going forward also, we believe that as and when the new contracts will be coming, we will be trying to bid them in Seamec and increase Seamec share of business. And gradually, HAL Offshore business will deplete by the expiry of the contracts."

Industry Backdrop and Long-Dated Opportunities

• ONGC and Reliance MOU: ONGC and Reliance Industries entered into an MOU to share offshore resources, including offshore supply vessels and logistics, aimed at improving operational efficiency in exploration and production activities.
• Government investment push: The government's USD10,000 crore investment push and liberalized exploration and production framework, plus refining capacity expansion from 260 MMTPA to 300 MMTPA, provide a supportive policy backdrop.
• ONGC OALP-VIII blocks are years away: ONGC secured 7 of 10 blocks in the OALP-VIII round. These blocks will undergo an extraction process taking 4 to 6 years to commercialize. Only then will scope for Seamec's vessels arise, so there is no immediate upside.
• Indian Oil refining expansion: Indian Oil Corporation announced plans to increase annual refining capacity to 9.8 crore tons from 8 crore tons over the next 18 months.

Guidance & Commitments

Key Metrics