Financial Performance Summary

Q2 FY27 Financial Results:

  • Total Income: INR581 crores (16.3% YoY growth from INR499 crores in Q2 FY26)
  • Adjusted EBITDA: INR91 crores (13% YoY growth from INR80 crores)
  • EBITDA Margin: 15.8% (impacted by forex loss and cost inflation)
  • Adjusted PAT: INR36 crores (compared to INR43 crores in Q2 FY26)
  • Forex Loss: INR4.61 crores recorded in other expenses

H1 FY27 Financial Results:

  • Revenue: INR1,110 crores (15% YoY growth from INR963 crores in H1 FY26)
  • Lamination Volumes: 41,000 tons (22% YoY growth)
  • Raw Casting & Machine Components Volume: 6,054 tons (1.6% YoY growth)

Operational Performance

Volume Metrics (Q2 FY27):

  • Total Lamination and Assembly Volumes: 21,600 tons (26% YoY growth)
  • Breakdown of Lamination Volume:
  • Lamination: 20,612 tons
  • Other Machine Components going into Lamination Assemblies: 1,059 tons
  • Total Raw Casting and Machine Components: 3,086 tons (6% YoY growth)
  • Breakdown of Casting Volume:
  • Raw Casting: ~1,000 tons
  • Machine Castings: ~2,000 tons
  • Machining Hours Utilized: 172,000 hours

Segment-wise Revenue Contribution (Q2 FY27):

  • Traction Motor and Railway Components: 27%
  • Power Generation: 16%
  • Industrial and Commercial Applications: 12%
  • Mining, Oil and Gas: 10%
  • Special Purpose Motors: 8%
  • Data Centers: 7%
  • Other Segments: 20%

Capacity Expansion Announcements

New Bangalore Greenfield Project:

  • Total Capex: INR450 crores
  • Land Procurement: INR125 crores
  • Infrastructure, Plant & Equipment: INR325 crores
  • Objective: Consolidate Bangalore lamination operations and increase capacity
  • Target Capacity:
  • Sheet metal capacity: 160,000 metric tons per annum (from current 108,000 tons)
  • Machining capacity: 1.31 million hours
  • Timeline: Phased implementation through FY31
  • Funding: Combination of internal accruals and debt

Previous Hyderabad Expansion:

  • Total Capex: INR290 crores (announced earlier)
  • Cumulative Capex: INR740 crores (INR290cr + INR450cr)
  • Committed Capex: INR250-260 crores for land and building infrastructure
  • Modular Capex: Remainder linked to customer demand

Maharashtra Government Incentive

  • Eligible Amount: Up to INR400 crores total incentive
  • Recovery Options:
  • INR57 crores per annum over 7 years
  • INR44 crores per annum over 9 years
  • Current Estimated Recovery: INR35-36 crores per annum based on sales
  • Deferral Decision: Incentive recognition deferred to FY28 to maximize recovery potential
  • Expected FY28 Recovery: ~INR40 crores per annum

Business Outlook and Guidance

Volume Guidance for FY27:

  • Lamination Volume: 82,000 tons (maintained from previous guidance)
  • Casting Volume: 17,000 tons (production basis)
  • H1 Achievement: 40,889 tons lamination volumes

Long-term Targets (FY31):

  • Revenue Potential: INR3,800 crores at full utilization
  • Breakdown:
  • INR850 crores from machine components
  • INR3,000 crores from lamination business
  • Blended EBITDA Margin Target: 17%+
  • Machine Components EBITDA Margin: 25%+

Growth Drivers:

  • Data center demand from customers including Cummins, Marathon, and Nidec
  • Railway modernization in North America
  • Mining and off-highway equipment demand
  • Power generation requirements

Operational Updates

  • Subsidiary Merger: Pitti Industries Private Limited and Dakshin Foundry Private Limited merged with parent entity in September 2026
  • Financial Reporting: Q2 and H1 results reported on standalone basis with previous numbers restated for comparability
  • Working Capital: Trade payables increased to INR470 crores from INR236 crores, expected to sustain
  • Capacity Utilization: Casting capacity at 24,600 tons with ~52% utilization in Q2

Management Commentary

  • Raw Material Inflation: Steel price increases being passed through to customers quarterly
  • Cost Pressures: Fuel and power costs expected to be passed through from January 2027
  • Manpower Costs: Increased due to capacity preparation for future growth
  • Geographic Focus: Domestic business growing faster than direct exports, though exports continue to grow absolutely
  • Customer Concentration: Top 5-7 customers expected to remain major revenue contributors

Q&A Session Highlights

  • Margin Recovery: Expected by Q4 FY27 through cost pass-through mechanisms
  • Funding Strategy: Capex primarily through internal accruals with debt flexibility for accelerated demand
  • Capacity Planning: Modular approach with equipment lead time of 6-8 months
  • Bangalore Consolidation: Multiple leased facilities (currently 3) to be consolidated into single location
  • Copper Winding: Exploring outsourcing options, potential future in-house capability