Aditya Infotech Q2 FY27 Revenue Jumps 90% YoY

Q2 FY27 Performance (Standalone & Consolidated):

Revenue: ₹1,746 crores, up 89.9% year-on-year (YoY).
EBITDA: ₹307 crores, up 177% YoY, with a margin of 17.6%.
PAT before exceptional item: ₹220 crores, up 214% YoY.
Reported PAT: ₹185.5 crores, after accounting for a one-time exceptional item of ₹34.4 crores related to a fire incident at the Kadapa plant. The loss is fully covered by insurance, and a claim has been lodged.

H1 FY27 Performance (Standalone & Consolidated):

Market Share & Business Mix:

The CP PLUS brand contributed 88% of Q2 revenue (vs. 86% a year ago).
Within CP PLUS, IP products now constitute 79% of the portfolio (up from 71%).
The company's share of the total Indian video surveillance market (including unorganized) was approximately 42% for the 12 months to September 2026, significantly higher than the 30% share at the time of its IPO.

Input Cost & Margin Strategy:

Gross margin for H1 was 30.4%, up 374 basis points YoY, driven by a richer product mix, localization, and operating leverage.
Q2 gross margin was 30%, flat YoY but down from 30.8% in Q1, as the company began absorbing sharp increases in input costs for SOC and memory components.
The company took strategic positions in SOC and memory inventory to secure supply and protect margins, which is reflected in a higher inventory balance.
Management expects H2 FY27 margins to be lower than Q2 as lower-cost inventory is used up and price increases are moderated to gain further market share.

Revised Guidance for FY27:

Revenue guidance raised to ₹6,500 - ₹6,800 crores (from ₹6,000 - ₹6,500 crores), representing growth of 54% to 61% over FY26.
EBITDA margin guidance maintained at 14% - 15%.
PAT margin guidance raised to 9% - 10% (from 8.5% - 9.5%).
Market share is expected to reach 43% - 45% by the end of FY27.

Completed a Qualified Institutions Placement (QIP) in September 2026, raising ₹1,500 crores.
All borrowings were repaid in October 2026; the company is now debt-free. The lower finance cost will be reflected from H2 FY27.
As of September 30, 2026, cash and cash equivalents stood at ₹1,434 crores against borrowings of ₹363 crores.
Finance cost for H1 was down 41% YoY.
Proceeds from the QIP are allocated for: 1) Repaying borrowings of Aditya Infotech Limited and its wholly-owned subsidiary AIL Dixon; 2) Manufacturing capacity expansion; 3) Inorganic growth through acquisitions; 4) General corporate purposes.

The board approved an investment of ₹45.4 crores for a 30% stake (on a fully diluted basis) in BLUE KGraph AI Solutions.
BLUE has developed a video compression layer that can reduce storage and bandwidth by up to 90% without needing a GPU.
The transaction is subject to customary conditions. The company will hold one board seat and one observer seat.

Manufacturing Capacity:

The Kadapa plant's current capacity is 2.5 million units per month.
Plans are in place to more than double capacity through Kadapa Phase 3 and a new facility in Greater Noida, funded from the QIP proceeds.

Component Localization:

The company is localizing four component categories:

Lenses: A fully integrated lens plant is planned in Greater Noida with a capacity of 2 million lenses per month.
Housing & Enclosures: A plant in Kadapa begins trials in Q3 FY27, with commercial production expected in Q4 FY27.
Cables: Production is expected to go live in Q4 FY27.
IoT Modules: Localization efforts are underway.

The company has a portfolio of brands targeting different market segments:

CP PLUS: Flagship and mainstream brand.
CP PLUS PRO: New range targeting the premium enterprise segment; rollout planned in Q4 FY27.
NEXIVUE & EYRA: Serve the entry and mid-market segments to counter the lower end and the unorganized sector. EYRA products are expected to hit the market by end-November or December 2026.

Working capital increased in H1 primarily due to a strategic increase in inventory for critical components.
Receivable days improved to 87 days in Q2, down from 93 days in Q1 and 105 days a year ago.
Management expects working capital to reduce in the future as the strategic component inventory is used up.

A national marketing campaign was launched for the festive season with Bollywood superstar Ranveer Singh as the brand ambassador.
The company has an R&D office in Taiwan.
Export strategy is under development, with plans to enter international markets in an 18-24 month timeframe, targeting geographies with a 'China plus one' strategy.