Key Financial Figures

  • FY26 Revenue growth: 12% Year-over-Year
  • FY26 PBT growth: 17% Year-over-Year
  • Consolidated annual sales: Approximately ₹4,000 crore
  • EBITDA impacted by one-time employee reorganization costs
  • Strong net cash position with 100% EBITDA conversion to cash
  • Capex for FY27: Approximately ₹200 crore (₹120-130 crore for factory relocation, ₹70 crore balancing capex)

Operational Performance

  • All regions grew except Australia and Southeast Asia
  • Sales mix stable: 50-50 between compressors and automotive equipment
  • 90-10 distribution between India and rest of world in compressor business
  • Employee costs increased 16% due to reorganization and shared services setup
  • Other expenses grew 8% due to IT investments including PLM system

Regional Business Outlook

India: Strong across all business verticals with positive inquiry levels, though conversion timing is elongated due to geopolitical uncertainty.

America: Performing very well post-reorganization with all verticals showing growth. Industrial segment performing exceedingly well, distribution business showing large opportunities.

Europe: Consolidation and cost realignment completed. Organization size aligned with business size. Expected to be profitable in FY27 (breakeven at worst case, marginal profitability more realistic).

Strategic Initiatives

  • Low-cost compressor range to counter Chinese competition: Design and validation completed, launch planned for September 2026 in India, followed by global rollout
  • Vacuum business entry through DVP license agreement: Long-term 10-12 year program for market learning and technology incubation
  • Motor technology advantage: 95%+ motors in-house with 3-day lead time vs 3-6 months for imports. New motor range launch planned in next 12-18 months
  • Inventory optimization: Significant progress achieved, further improvements expected in FY27
  • IT transformation: 3-4 year journey for global process digitalization

Commodity Price Impact & Guidance

  • Metal commodity prices rising rapidly since April 2026, similar to post-COVID pattern
  • 80% of projected annual cost increase already occurred in Q1 FY27
  • Price corrections of 2.5-3% already introduced, additional corrections planned for June 2026
  • Q1 FY27 guidance: Similar top-line growth as FY26, similar bottom-line percentages
  • Comfortable with commodity price situation until June 2026, watching carefully thereafter

Market Challenges

  • West Asia geopolitical situation causing market uncertainty
  • Tariff situation in US: Currently at 25% (down from 50%), engaged in discussions about past tariff refunds
  • European market growth muted due to Ukraine war, energy crisis, inflation, and unemployment

Specific Business Segments

  • Railways: Present in inter-city business, not in metros
  • Defence: Limited presence through joint venture supplying high-pressure compressors for Navy
  • Data Centers: No direct business, only ancillary plant-level requirements
  • Emerging sectors: Strong presence in solar industry

Forex & EBITDA Details

  • Significant net foreign exchange earner with positive impact
  • Europe EBITDA: Loss for full year FY26, breakeven for Q4 FY26
  • Exact forex gain numbers not provided in transcript (to be obtained through investor connect)

Regulatory & Accounting Impacts

  • Wage code provision made in Q3 FY26 reflected in annual numbers
  • Lease accounting changes due to property sale and leaseback in US affecting depreciation