Event Type and Details

  • This is a transcript of the Q4 and FY '26 Earnings Conference Call held on June 1, 2026.
  • The call was hosted by the company's management for investors and analysts.

Management Participants

  • Mr. Arvind Kapur – Chairman, Chief Executive Officer and Managing Director
  • Mr. R.K. Miglani – Executive Director
  • Mr. Kaushalendra Verma – Executive Director
  • Mr. Naveen Sorot – Chief Financial Officer

Financial Performance Highlights

Q4 FY26 Performance:

  • Revenue: INR 677 crores (including exports of INR 102 crores)
  • EBITDA: INR 47.8 crores
  • EBITDA Margin: 7.1%
  • PAT: INR 6.9 crores

Full Year FY26 Performance:

  • Revenue: INR 2,477 crores (up 12% YoY, highest ever annual revenue)
  • Exports: INR 395 crores (16% of total revenue vs 15% last year)
  • EBITDA: INR 223 crores
  • EBITDA Margin: 9%
  • PAT: INR 52.4 crores (vs INR 19.2 crores last year)

Non-Recurring Impacts on Profitability:

  • Labour Code impact: INR 3.6 crores in Q4, INR 11 crores for full year
  • Raw material lag settlement impact: INR 11 crores in Q4, INR 19 crores for full year
  • Normalized EBITDA margin excluding these impacts: 10.25% for FY26

Business Segment Performance:

  • Aluminum business: INR 2,155 crores (88% of total revenue)
  • Ferrous business: INR 322 crores (12% of total revenue)

Operational and Strategic Updates

Order Book and Growth Outlook:

  • Secured new orders worth approximately INR 2,500 crores over 5-year program life
  • Targeting revenue exceeding INR 3,000 crores in FY27
  • Export growth forecast of 32% for FY27, primarily to Germany and USA

Capacity Expansion:

  • Hosur facility progressing as planned, expected operational from September 2026
  • Will cater to hybrid and EV-related programs for key OEM customers
  • Received Tamil Nadu government subsidy approval of INR 39 crores (available for 10 years)

Margin Improvement Initiatives:

  • Renegotiating raw material settlement cycles with customers
  • 75% of customers by value have agreed to monthly settlements
  • Reviewing entire product portfolio to identify and renegotiate low-margin products

Diversification Efforts:

Railway Business:

  • RDSO approvals received for multiple components
  • First dispatches completed 4-5 days before the call
  • Targeting INR 100 crores revenue in FY27
  • Products include bearing adapters, LC cast iron inserts, track adjusters, distance blocks

Defense Business:

  • Currently manufacturing shooting ranges
  • Targeting INR 50 crores revenue in FY27
  • Working to double defense business in next 2 years

Machine Tools Business:

  • Historically manufactured CNC machines for internal use only
  • Recently completed first commercial sale
  • Capacity includes 14-axis, 16-axis, 5-axis, and 8-axis machines

Balance Sheet and Capital Management

  • Working capital days improved to 7 days from 33 days last year
  • Cash flow from operations: INR 331 crores during FY26
  • Net debt: INR 686 crores (vs INR 653.1 crores last year)
  • Debt repayment schedule: INR 110-120 crores annually over next 3 years
  • Current leverage: 3.75x

Property Monetization Update

  • Ongoing discussions for Gurugram property sale
  • Previously rejected offer of INR 700 crores as undervalued
  • Receiving better offers than previous bids
  • Timeline: Potential closure within 6 months if right price is achieved

Capacity Utilization

  • Iron casting: ~65-70% utilization
  • Aluminum die casting: ~65-70% utilization (varies by machine capacity)
  • Higher tonnage machines have available capacity for new programs

Additional Notes Section

  • The transcript includes a standard forward-looking statement disclaimer indicating that statements are based on beliefs and opinions as of the call date and are not guarantees of future performance.
  • The document explicitly states that no unpublished price sensitive information (UPSI) was shared during the call.
  • The transcript was edited for factual errors and readability, with audio recordings serving as the authoritative source in case of discrepancies.
  • The enclosed transcript was the only attachment mentioned in the disclosure.