Frontier Springs Limited conducted an earnings conference call on June 3, 2026, to discuss audited financial results for Q4 and FY ended March 31, 2026. The call was hosted by TIL Advisors with management participants including Mr. Kapil Bhatia (Managing Director), Mr. Neeraj Bhatia (Chief Financial Officer), and Mr. Dhruv Bhasin (Company Secretary).

Financial Performance Highlights

Full Year FY26 Results:

  • Revenue from operations: ₹322.06 crore, up 39.22% from ₹231.34 crore in FY25
  • EBITDA: ₹86.31 crore, growth of 73.80% over FY25
  • EBITDA margin: 26.80%, improved from 21.47% in FY25 (533 basis points expansion)
  • Profit after tax: ₹61.31 crore, up 76.88% from ₹34.66 crore in FY25
  • Earnings per share: ₹51.07 compared to ₹29.93 in prior year
  • Gross sales target of approximately ₹375 crore surpassed

Q4 FY26 Results:

  • Revenue from operations: ₹82.54 crore, growth of 17.7% over Q4 FY25
  • EBITDA: ₹23.54 crore at margin of 28.51% (362 basis point improvement)
  • Profit after tax: ₹16.59 crore, up 42.22% year-on-year

Operational and Business Updates

Business Environment:

  • Indian Railways remains primary customer with ₹2.65 lakh crore capital outlay in Union Budget 2026
  • Steel prices remained elevated through second part of the year, creating cost pressure
  • Company responded by negotiating favorable terms with vendors and focusing on high-value tenders

Division-wise Performance:

  • Springs business: Steady demand across freight stock, coaching stock, and locomotive applications
  • Springs continue to be fitted on Vande Bharat Express trains
  • Forging division: Installed state-of-the-art 6-ton hammer enhancing capabilities
  • Begun receiving orders for components manufactured on new hammer
  • Few forging components approved for Vande Bharat trains
  • Air spring segment: Production ramped up through memorandum of understanding with Quant-Technik GmbH for LHB coaches
  • Failure indication and brake application system (FIBA) remains on track
  • Extended capacities in both coil springs and air spring segments

Capacity and Order Book:

  • Current order book: ₹300 crores providing good revenue visibility
  • FY27 revenue guidance: ₹500 crores gross revenues (over 30% growth from FY26)
  • Current capacity utilization: Approximately 70% across all plants
  • Air spring capacity: 300 coach sets per month, currently producing 180-190 coach sets per month

Management Commentary and Guidance

FY27 Outlook:

  • Targeting 30% growth with reasonable profit margin
  • Expecting good orders from wagon manufacturing tenders
  • Planning ₹20-25 crore CAPEX for all three divisions to increase capacity and modernization
  • Margin guidance: Trying to maintain between 23%-24% (compared to 26.80% in FY26)

Raw Material Management:

  • Negotiating with steel suppliers and energy providers (LPG, CNG, furnace oil)
  • Using cheaper available energy sources to maintain margins
  • Increasing product prices to Railways in future tenders to offset cost increases

New Product Development:

  • FIBA (failure indication and brake application system) received basic approval from RDSO
  • Trials expected to start in trains, with regular production anticipated after 6 months
  • Expected market size: ₹40-50 crores annually
  • Expected FY27 contribution: ₹20-25 crores revenue
  • Company will be second indigenous manufacturer of FIBA in India

Q&A Session Highlights

Margin Pressure: Management acknowledged potential 1-2% margin compression due to fixed-price existing contracts but confident in maintaining 23-24% margins through negotiations and future tender price increases.

Growth Sustainability: Company expects 25% growth beyond FY27 due to strong Indian Railways demand for coaches, wagons, and locomotives. No order drought anticipated for next 5-10 years.

Capacity Expansion: Working to break quarterly revenue range of ₹80-83 crores, targeting improvement in Q1 FY27. Have sufficient capacity to support guided growth.

Export Strategy: Exploring forging exports to Europe and America where manufacturing is declining. Focusing on markets with better margins rather than automotive sector.

Defence Business: Progressing slowly due to lengthy procedures. Also targeting other industries like L&T, JCB, Caterpillar for forging components.

Trade Receivables: Increased due to higher turnover (₹30-35 crores monthly business) but all considered good quality with zero bad debts.

Sleeper Trains Opportunity: Company approved and positioned to supply springs for sleeper Vande Bharat trains, with significant contributions expected in FY28-29.