Financial Performance

Quarterly Results (Q2 FY27):

  • Operating Revenue: ₹413.2 crores (vs. ₹374.5 crores in Q2 FY26, up 10% YoY)
  • Consolidated EBITDA: ₹14.1 crores (vs. ₹20.3 crores in Q2 FY26)
  • EBITDA Margin: 3.4% (vs. 5.4% in Q2 FY26, a decline of 200 bps)
  • PAT (excluding extraordinary items): ₹3.8 crores (vs. ₹13.8 crores in Q2 FY26)

Key Factors Impacting Margins:

  • Raw material costs increased significantly due to:
  • Polymer prices up ~30% YoY driven by crude oil price increases from Middle East conflict
  • Steel prices increased 12-15%
  • Copper prices at all-time highs
  • INR depreciation against USD and CNY affecting import costs
  • Minimum wage increase of 25% effective April 1, 2026, in Ghaziabad region (where largest factory is located)
  • Additional 10% minimum wage increase effective October 1, 2026
  • Product mix changes with decline in higher value-addition motors and select lighting products

Liquidity & Capital Structure:

  • Net debt position: ₹6.4 crores as of September 2026
  • H1 FY27 Capex: ₹77.5 crores (₹65 crores for Bhiwadi plant capitalization, ₹12.5 crores for existing business)
  • Working capital days: 52 days at September 2026 (vs. 53 days in September 2025)

Business Segment Performance

Lighting, Fans and Switch Segment:

  • Revenue: ₹77.8 crores (vs. ₹72.4 crores in Q2 FY26)
  • LED lighting (excluding flashlight) increased from ₹47.5 crores to ₹54.4 crores
  • Company scaled down batten production from August due to pricing pressures
  • Fan business steady at ₹15 crores, with strong outlook for BLDC ceiling fans

Home Appliance Segment:

  • Revenue: ₹175.8 crores (vs. ₹140.6 crores in Q2 FY26, up 25% YoY)
  • Kitchen and home care: 25% YoY growth driven by mixer grinders and irons
  • Started regular supplies of electric kettles in the quarter
  • Personal care: 28% YoY growth driven by hair dryers and sterilizers
  • Added new customer for personal care in the quarter
  • Participated in government tenders

FHP Motor Segment:

  • Revenue: ₹56.8 crores (vs. ₹73.5 crores in Q2 FY26)
  • Decline reflects only third-party sales (captive consumption increased but captured in appliance sales)

Bhiwadi Plant Update

  • Plant ready and commenced commercial production in mid-September 2026
  • Started with ORP production, will add fans and chimneys
  • Revenue guidance: ₹45-50 crores for remainder of FY27 (6 months)
  • FY28 revenue guidance: ~₹150 crores
  • Full potential: ₹500-550 crores in approximately 4 years
  • Additional capex required: ₹12-14 crores for Phase 2 (1 lakh sq. ft. factory shed)
  • Margin expectations: 2.5-3% EBITDA in FY27, 6-6.5% in FY28 at ₹150 crore revenue

Guidance & Outlook

  • FY27 Revenue Guidance: ~₹1400 crores (±3% variation)
  • No EBITDA guidance provided due to volatile macro environment
  • Management prioritizing profitability over revenue growth
  • Initiating discussions with customers to pass on assembly cost increases from minimum wage hikes
  • Q3 typically seasonally slow quarter post-Diwali
  • Some Q2 revenue expected to spill over to Q3 due to delayed Diwali

Management Commentary

  • Focus on profitability improvement rather than revenue chasing
  • Some margin recovery visible with Q2 EBITDA at 3.4% vs. 1.1% in Q1
  • Expect margin stabilization in future quarters as customer price discussions progress
  • Believe current quarter should form base for future margin improvement