Greaves Cotton Q2 Revenue Up 44% Amid Margin Pressure

Financial Performance Highlights

Consolidated Performance:

• Q2 FY27 Revenue: INR 1,176 crores, representing 44% YoY growth (from INR 815 crores in Q2 FY26)
• H1 FY27 Revenue: INR 2,150 crores, representing 38% YoY growth (from INR 1,561 crores in H1 FY26)
• Q2 FY27 EBITDA: 43% YoY growth (absolute figures not specified)
• Q2 FY27 EBITDA Margin: 6.2% (improved from 5.8% in Q1 FY27)

Core Business Performance:

• Q2 FY27 Revenue: INR 768 crores, representing 24% YoY growth (from INR 621 crores)
• H1 FY27 Revenue: INR 1,478 crores, representing 20% YoY growth (from INR 1,233 crores)
• Q2 FY27 Core Business EBITDA Margin: 11.5% (down from 14.8% YoY)

Greaves Electric Mobility (GEML) Performance:

• Q2 FY27 Consolidated Revenue: INR 410 crores, representing 106% YoY growth (from INR 199 crores)
• H1 FY27 Consolidated Revenue: INR 680 crores (from INR 335 crores same period last year)
• E-two-wheeler Q2 Revenue: INR 350 crores, 134% YoY growth
• L5 three-wheeler Q2 Revenue: ~INR 60 crores, 55% YoY growth
• EBITDA losses narrowed to INR 25 crores from INR 42 crores YoY

Business Segment Performance

Energy Solutions:

• Q2 YoY Growth: 36% (accelerated from 21% in Q1)
• Medium Horsepower (MHP) genset portfolio (160-750 kVA) grew 35% in H1 FY27 vs 28% overall business growth
• Completed first batch of enhanced gensets for Middle East market
• Established entity in Middle East with sales and service capabilities

Mobility Solutions:

• Q2 YoY Growth: 23% (improved from 18% in Q1)
• Automotive Engines: 37% YoY growth supported by three-wheeler and four-wheeler demand
• Launched new 470 cc diesel engine for three-wheeler applications
• Excel Controlinkage: 30% YoY growth with new product orders and customer wins
• Completed acquisition of remaining 20% stake in Excel, making it wholly owned subsidiary

Industrial Solutions:

• Reported revenue broadly flat YoY
• Like-for-like growth of 9% after adjusting for portfolio rationalization (exit from farm equipment business)
• Launched new 750 HP Fire Fighting Engine
• Unveiled prototypes for 160 cc gasoline engine

Strategic Initiatives & GREAVES.NEXT Progress

• Focus on increasing engineering content, differentiation, and value addition across portfolio
• International expansion in Middle East and Africa markets
• Movement from individual components to high value-added assemblies and integrated engineering solutions
• Portfolio optimization completed with exits from non-core businesses (retail, farm equipment)

Greaves Electric Mobility Detailed Performance

Volume Metrics:

• E-two-wheeler Q2 volumes: 37,000+ units, 114% YoY growth
• L5 three-wheeler Q2 volumes: ~2,800 units, 61% YoY growth
• H1 FY27 VAHAN registrations: 53,700 units, 107% YoY growth
• H1 billing volumes reached 91% of full year FY26 volumes

Market Position:

• Market share improved to 4.8% in H1 FY27 vs 4.1% in H1 FY26
• Peak market share of 5.6% in June 2026
• Top two player in Tamil Nadu (15% share) and Bihar (18% share, ranked #1)
• Top three player in 35% of RTOs served
• Gained share YoY in 60% of RTOs served

Operational Developments:

• Network expansion: 160 new dealership LOIs issued in H1, existing dealers opened 20 new branches
• Dealer throughput improved 40% YoY to 25 units per month
• B2B volumes grew 18% YoY in H1 with multiple new fleet accounts
• E-commerce platforms drove 3x volume growth YoY
• Reo VYB low-speed segment well received

Technology & Product Development:

• Secured design registration for rare-earth-element-free ferrite-assisted synchronous reluctance motor (developed in-house)
• Motor deployment to begin with two-wheeler portfolio in Q4 FY27
• Upgraded scooters with IntelliPack connectivity suite
• Nexus EX Plus: 5-kilowatt motor with higher gradeability and IntelliPack
• Magnus G Max: 30+ connected features through Ampere Connect app

Financial Improvements:

• E-two-wheeler average realization improved by INR 5,000 to ~INR 93,000 per unit
• EBITDA losses per unit reduced 70% in Q2 from ~INR 20,000 to <INR 6,300 per unit
• EBITDA margin improved from -24% in Q2 FY26 to -7% in Q2 FY27
• Cash burn reached record low per month
• Expected breakeven timeline: "fairly soon" (no specific date provided)

Profitability Challenges & Mitigation

Commodity Pressure:

• Primary commodities affecting margins: aluminium, iron, copper, Platinum Group Metals (PGM)
• Pricing actions implemented with lag effect in B2B/OEM ecosystem
• Full company-wide benefit of pricing actions expected by Q4 FY27

Margin Improvement Actions:

• Pricing discipline initiatives
• Value engineering programs
• Productivity improvements
• Tight cost management
• Distinction maintained between optimizable costs and essential future investments

Capital Allocation & Investments

• Invested INR 331 crores in GEML rights issue
• Invested INR 112 crores to acquire remaining 20% stake in Excel Controlinkage
• Core Business cash position: INR 150 crores with INR 40 crores debt (net INR 110 crores cash)
• AA- credit rating with minimal debt

Exceptional Items & Accounting Treatment

• Accelerated depreciation: INR 27 crores (related to brands, goodwill, and intangible assets review)
• Exceptional items: INR 33 crores (including planned IPO expenses for GEML and impairment charges)
• Total impact: INR 60.1 crores on consolidated financial statements

GEML IPO Timeline

• No definite date provided
• Conversation underway with IPO committee
• Market conditions and enterprise valuation being monitored
• Business "well funded" after rights issue completion

Capacity & Utilization

• GEML capacity: ~40,000 units per month
• Current utilization: ~40%
• Capacity expected to cover needs for next couple of years
• Supply chain ecosystem expansion underway to support higher growth rates

Forward-looking Commentary (as explicitly stated)

• H2 expected to be better than H1 on margin side
• Committed to 13-15% EBITDA margin target in mid to long-term
• Full benefit of pricing actions expected by Q4 FY27
• Breakeven expected "fairly soon" for EV business
• No further significant write-offs expected at this stage