Financial Performance Highlights

FY26 Performance:

  • Total Income: ₹70.60 crores
  • EBITDA: ₹7.31 crores
  • EBITDA Margin: 10.39%
  • Profit After Tax: ₹4.50 crores

H2 FY26 Performance:

  • Total Income: ₹42.59 crores
  • EBITDA: ₹5.01 crores
  • EBITDA Margin: 11.77%
  • Profit After Tax: ₹3.25 crores

Revenue Decline Explanation

The company attributed the year-over-year revenue decline of approximately ₹9 crores to project delays from two EPC customers in the renewable energy and infrastructure sectors:

  • Customer 1: ₹31 crore order (25 of 35 transformers manufactured worth ₹21-22 crores, but delivery delayed due to customer's dispute with Maharashtra Government)
  • Customer 2: ₹3 crore order (site delayed)

This represents revenue deferment from FY26 to FY27 rather than lost business.

Operational Highlights and Business Updates

Technical Achievement:

  • Successfully completed dynamic short-circuit test for 17.60 MVA inverter duty transformer at CPRI (highest rating in transformer industry for renewable segment)

Order Wins:

  • Secured transformer and compact substation (CSS) orders aggregating ₹9.70 crores
  • Submitted bids worth ₹125 crores in MVVNL tender (total value ₹356 crores)
  • Submitted bids worth ₹100 crores with Torrent Power

Customer Expansion:

  • Expanded approved vendor base with MVVNL, DHBVNL, UGVNL, Toyota, and SMC-C Japan
  • Reduced customer concentration from 35-40% from single customer in FY25 to more diversified customer base

Capacity and Expansion:

  • Current manufacturing facility capacity: ₹150-200 crores business potential
  • Current utilization: 75-80%
  • Identified land for proposed manufacturing facility expansion (2.50 lakh square feet)
  • Expansion will enable entry into EHV transformers and in-house sheet metal process with powder coating facility
  • Expansion construction expected to begin in 2-3 months, with manufacturing starting within 6 months

Order Book and Guidance

Order Book:

  • Healthy order book of approximately ₹156 crores as of May 25, 2026

Revenue Guidance:

  • FY27: ₹120-180 crores (60-80% growth from FY26)
  • Subsequent years: 30-50% growth

Margin Guidance:

  • Target EBITDA margin: 13-15%
  • Target PAT margin: 9-11% (approximately 10% average)

Strategic Initiatives

International Expansion - Russia MoU:

  • Signed strategic Memorandum of Understanding with Western Administrative District of Moscow
  • Collaboration focuses on energy infrastructure development, EPC projects, manufacturing cooperation, and technology exchange
  • Russian delegation visited company facilities
  • Potential technology transfer for dry-type transformers and EHV transformers
  • Discussion ongoing regarding potential investment and joint venture

EV Charging Infrastructure Project:

  • Exclusive LOI received for National Highway for Electric Vehicle (NHEV) project
  • Project involves developing 450 charging stations across 5,500 kilometers of highways
  • Total project value for compact substations: approximately ₹1,600 crores
  • Accord responsible for electrification work - charging stations, control panels, compact substations
  • Project timeline: 3-4 years
  • First 10 locations identified; expected to commence work on 10-15 stations by end of FY27
  • Partnership with Tata (vehicle provider) and Infosys (software fencing)

Product Portfolio and Revenue Mix

  • Transformers: 80% of revenue (approximately ₹58 crores)
  • Package Substations (PSS) and Compact Substations (CSS): 10% of revenue (approximately ₹8 crores)
  • Remaining 10% from other products

Raw Material Management and Margin Sustainability

  • Price variation clauses applied to orders with delivery beyond 2-3 months
  • IEEMA clause coverage for major materials in utility projects
  • Copper, CRGO steel, and transformer oil managed through hedging (3-month forward booking)
  • Maintain 1-1.5 months of transformer oil stock
  • Operating leverage expected to support margin improvement as revenue scales

Manufacturing and Automation

  • Current capacity: 1,200 MVA
  • Automation implemented in testing facilities and winding machines (PLC-based, drive-based)
  • Exploring robotic welding for tank fabrication to address welder shortage
  • Limited automation potential in power transformers due to heavy product weights (20-40 metric tons)

Dividend Policy

  • No dividend declared for FY25-26
  • Company in expansion phase with significant working capital requirements
  • Dividend consideration possible in 1-2 years after addressing capital needs

Competitive Positioning

  • Competes with multinationals (ABB, Siemens, Crompton) in certain segments
  • Advantages include lower overhead costs and 100% in-house manufacturing vs. competitors who use OEMs
  • Strong technical capabilities with CPRI certification for high-rated transformers