Carraro India Limited – Investor Presentation Summary

Key Operational Highlights

  • Produced 37,605 transmission systems and 1,17,898 axles in FY26.
  • Gear production reached approximately 1.89 million units.
  • Capacity utilization stood at 75.95% for drivelines and 79.78% for gears plant.
  • Low overall rejection rates of 0.01% maintained in FY26.

Key drivers of operational performance: Strong demand for 4WD axles in domestic agricultural segment, sustained export momentum in construction equipment, and ramp-up of new telescopic handler axle production.

Segment-wise Performance

  • Domestic Business: Grew 19% year-on-year, led by strong demand for 4WD axles in agricultural segments.
  • Export Business: Grew 37% year-on-year, driven by strong demand for construction equipment, mainly Tele Boom Handlers (TBH).
  • Engineering Services: Reported revenues of ₹100 million in FY26 with several enquiries for higher HP and technology configurations.

Explanation of significant changes in segment performance: Domestic growth driven by GST-led acceleration from 2WD to 4WD tractors; export growth supported by construction equipment demand despite softness in agricultural driveline exports.

Financial Highlights

Revenue: ₹22,555 million

EBITDA: ₹2,475 million

PAT: ₹1,306 million

EPS: ₹22.97

Margins: Gross Profit Margin 27.5%, EBITDA Margin 10.8%, PAT Margin 5.7%

YoY/QoQ comparison: Revenue up 25% YoY, EBITDA up 33% YoY, PAT up 48% YoY

Drivers of financial performance: Operating leverage, disciplined cost management, execution efficiencies, and favorable product mix

Key Risks: Changes in product mix, raw material price fluctuations, competition (both domestic and international), economic growth fluctuations

Geographical Revenue Split

Domestic vs Export Revenue: Domestic business represented majority share with 19% growth; Export business represented significant portion with 37% growth

Regional Breakdown: Export growth primarily driven by construction equipment demand from international markets; Domestic demand strong in agricultural segment

Balance Sheet Snapshot

Net Debt/Equity: Not explicitly specified

Reserves: ₹5,077 million in Other Equity

Current Assets/Liabilities: Current Assets ₹8,511 million, Current Liabilities ₹5,238 million

Working Capital/Leverage Metrics: Healthy cash and cash equivalents of ₹904 million

Financial Health Insights: Strong balance sheet with total equity of ₹5,647 million, improved profitability trends

Capex & Cash Flow Health

Capital Expenditure: ₹417 million deployed in FY26

Free Cash Flow: Not explicitly specified

Operating Cash Flow: Net cash from operating activities ₹1,558 million

Net Debt Movement: Not explicitly specified

Investment Rationale: Support new telescopic handler axle production, high-performance transmission programs for agricultural applications, and incremental capacity expansion

Strategic & R&D Initiatives

Investments in Innovation: New range of Tele Boom Handler axles, higher HP tractor transmission projects, e-transmissions development

Expected impact on growth: Engineering services agreement worth ₹175 million with Montra Electric for e-transmissions industrialization

Strategic Rationale: Expanding into emerging technologies, developing future-ready solutions for electric off-highway vehicles

Industry Trends & Business Environment

Macro/Industry Trends: Accelerated transition from 2WD to 4WD tractors following GST reduction, gradual recovery in export market for higher HP tractors

Impact on Company: Structural shift towards 4WD tractors resulting in robust growth in domestic 4WD axle market; export recovery expected to positively impact transmission off-take

Management Commentary & Growth Outlook

Strategic Outlook: "FY26 was a strong and encouraging year for Carraro India, with the Company delivering healthy growth across both domestic and export markets, along with EBITDA profitability in line with guidance"

FY Guidance: Not explicitly specified for future periods

Market Share Targets: Market leader in transmission systems for tractors up to 150HP with 4WD capabilities; leading sole supplier in non-captive segment of agriculture tractors transmission market

Risks and Opportunities: Fluctuations in earnings, ability to manage growth, competition, economic growth in India and abroad, government policies and regulations

ESG Updates

  • Received Manitou Equipment CSR Corporate Social Responsibility Award
  • Recognized for outstanding contribution for Corporate Social Responsibility

Digital Transformation

  • Developing future-ready solutions for emerging technologies including e-transmissions
  • Engineering services for electric off-highway vehicles progressing with Montra Electric