Key Financial Figures (Consolidated, Q1 FY27)

  • Revenue: ₹2,034 crore, up 35.2% Year-on-Year (YoY).
  • EBITDA: ₹156.2 crore, up 12.1% YoY.
  • EBITDA Margin: 7.7%.
  • Net Profit: ₹75.3 crore, up 12.9% YoY.
  • Cash & Bank Balance: ₹491.3 crore.
  • The company is now net cash positive with modest debt.

Segment-wise Performance (Q1 FY27)

  • Product Business (80% of Sales): Grew 40.7% YoY.
  • Room AC (RAC): Revenue of ₹1,401 crore, up 38.1% YoY. Volume growth was 20-22%; ASP increased 10-12%.
  • Washing Machine: Revenue of ₹211 crore, up 67.2% YoY. Fully automatic machines grew 150% YoY.
  • Coolers: Revenue of ~₹19 crore, up 3.4% YoY.
  • Electronics Business: Grew 65.3% YoY, contributing 5.3% of revenue.
  • Plastic Moulding & Components: Revenue of ₹294.6 crore, up 7% YoY.
  • Joint Venture (Goodworth Electronics): Revenue of ₹177.3 crore (vs. ₹147.5 crore last year); EBITDA of ₹6.3 crore (vs. ₹4.3 crore).
  • Subsidiary (PG Technoplast): Reported sales of ₹1,600 crore for the quarter.

Margin Commentary

Gross margin percentage softened QoQ and YoY due to elevated commodity prices (copper, aluminum) and rupee depreciation. The company clarified that product pricing is structured on a per-unit margin, not a percentage. On a per-unit basis, margins remained stable versus last year. Commodity cost increases have been partially passed through to customers.

Operational & Strategic Updates

  • New Washing Machine Plant: A new state-of-the-art facility in DMIC, Greater Noida, with an annual capacity of 1.8 million units, is now operational. The company is launching a new 18-20 kg washing machine platform.
  • Refrigerator Facility: A new plant in Sri City is on track for commercial production in Q4 FY27. It will have a capacity of 1.2 million units, starting with direct cool and side-by-side models. An anchor customer has committed to 30-35% of the capacity.
  • Compressor Project: The project in Supa is on track for mass production in FY27. The first line (2 million capacity) is expected to be online. The company plans a potential second line decision in April-May 2027.
  • Consolidation: Operations from some Greater Noida units are being relocated to a new facility in Salarpur, Rajasthan, under subsidiary PG Technoplast.
  • Strategic Priorities: Focus on R&D, new product development, backward integration, and capability enhancement for long-term resilience and capital efficiency.

Management Outlook & Guidance

  • The company expects to achieve ~8% EBITDA margin for FY27 (on an operating level, ex-PLI).
  • For FY27, volume growth is anticipated to be around 20%+, aided by a low base in most quarters.
  • Management is confident that FY27 earnings will surpass FY25 numbers.
  • The long-term strategy is to reduce dependence on ACs (currently 60-65% of sales) to 50-55% over 2-3 years through diversification.

Industry & Market Context (from Q&A)

  • RAC Industry Growth: Primary sales grew ~15% YoY in Q1; secondary sales were better, leading to lower channel inventory by June-end (~4.5-5.5 million units).
  • Outsourcing Trend: The percentage of RAC outsourcing is increasing at the industry level.
  • Commodity Price Pass-Through: The company expects further price increases to be implemented in the December quarter to account for high copper prices (~$14,000/tonne) and rupee depreciation (~₹95.5-96/$).
  • Compressor Import Restrictions: The government has restricted compressor imports to 25% of FY25 import volumes until March 31, 2027, after which imports will be disallowed. Currently, ~60% of industry requirements are imported, potentially leading to a supply constraint.
  • Competitive Intensity: Acknowledged as high, with the company focusing on operational efficiency to maintain its competitive margin profile.

Capital Expenditure (Capex)

  • Total capex for FY27 is approximately ₹400 crore, allocated to completing the ongoing compressor and refrigerator projects and the consolidation in Salarpur.
  • The focus for the year is on completing projects and sweating existing assets.