Event Type and Timing:

  • Earnings Conference Call held on Wednesday, 27th May 2026
  • Call discussed Audited Financial Results for quarter and financial year ended 31st March 2026

Management Participants:

  • Dr. Balaji Gopalan – Managing Director
  • Mr. Davide Grossi – Whole-time Director & Chief Financial Officer
  • Mr. Sudhendra Mannikar – Whole-time Director & Chief Operating Officer
  • Mr. Ashok Rai – Director, Sales & Business Development
  • Other members of leadership team and Investor Relations Advisor, Strategic Growth Advisors

Financial Performance Highlights:

FY26 Full Year Performance:

  • Revenue from operations: INR22,555 million (INR2,255 crores), up 25% YoY
  • Total income: INR22,840 million
  • EBITDA: INR2,475 million, up 33% YoY
  • EBITDA margin: 10.8% vs 10.2% in FY25
  • PAT: INR1,306 million, up 48% YoY
  • PAT margin: 5.7%
  • Other income included INR83.8 million reversal of provision for vendor payment

Q4 FY26 Performance:

  • Revenue from operations: INR6,067 million (INR606 crores), up 37% YoY
  • Total income: INR6,142 million, up 37% YoY
  • EBITDA: INR710 million, up 45% YoY
  • EBITDA margin: 11.6% vs 10.9% in Q4 FY25
  • PAT: INR417 million, up 76% YoY
  • PAT margin: 6.8% vs 5.3% in Q4 FY25

Segment-wise Performance (FY26):

  • Agricultural vehicles revenue: INR10,192 million, up 19% YoY
  • Construction vehicles revenue: INR9,837 million, up 31% YoY
  • Domestic revenue: INR14,430 million (64% of total)
  • Export revenue: INR8,125 million (36% of total), up 37% YoY

Business Updates and Strategic Initiatives:

Industry Context:

  • Indian tractor industry crossed 1 million unit milestone in FY26
  • Construction equipment domestic market declined by approximately 2% YoY
  • Construction equipment exports grew by nearly 32% YoY

Domestic Agriculture Business:

  • Strong performance driven by accelerated shift from 2WD to 4WD tractors post-GST reduction
  • 4WD tractor growth significantly outpaced broader tractor industry
  • Domestic 4WD market reached approximately 24% penetration in above 40HP segment
  • Estimated 60-65% of 4WD axles outsourced to external players like Carraro

Construction Equipment Business:

  • Ramp-up of new Tele Boom Handler (TBH) axles for major international OEM progressed well
  • Sales to Indian construction customers increased by approximately 9% despite market decline of 2%
  • Backhoe loader sales recorded positive growth despite broader BHL market declining by nearly 10%

Higher Horsepower Transmission Business:

  • Export market gradually recovering
  • Turkey program expected Start of Production (SOP) during FY27
  • Indian customer program expected production by FY28

Gear Business:

  • Secured business nomination for bull gears valued at approximately INR150 million annually starting FY28
  • Working on two additional customer programs

Engineering Services Business:

  • Revenues of approximately INR100 million during FY26
  • Signed engineering services agreement worth approximately INR175 million with Montra Electric for electric transmissions

Operational Metrics:

  • Capex deployment: INR417 million towards new telescopic handler axle production, high-performance transmission programs, capacity expansion
  • Raw material localization: 78% during FY26, target of 86-88% over next 2-3 years
  • Working capital days: Reduced to 38 days from 45 days in FY25
  • Debt-to-equity: Improved to 0.27x from 0.42x in March 2025
  • Return on capital employed: 29.2%
  • Return on equity: 25.5%

Dividend:

  • Board recommended final dividend of INR6.75 per equity share for FY26
  • Payout ratio approximately 30%

Guidance and Outlook:

  • FY30 revenue target: INR3,500-4,000 crores (exceeding earlier target)
  • FY27: Maintaining cautious outlook due to macroeconomic and geopolitical uncertainties, particularly in West Asia
  • Expect positive growth in FY27, though potentially lower than original 8-12% guidance
  • Target EBITDA margin improvement supported by localization, operating efficiencies, and cost management

Additional Notes Section:

  • Transcript hosted on company website: https://www.carraroindia.com/investors/investor-information/announcements-and-notices
  • Document contains forward-looking statements as disclosed in the call
  • The transcript is edited for factual errors, with audio recordings on stock exchanges prevailing in case of discrepancy