Q3FY26 Result & Concall Insights
Full-Year Guidance (FY26):
•Revenue growth: 25%
•EBITDA margin: 16–17%
•Order book target: Rs. 8,000cr by the end of FY26
•Unexecuted Orders are expected to get delivered within 24 months
•The company has intended to reduce its order execution cycle to 18 months from 24–28 months, improving efficiency.
Q3 Performance Adjustment:
•In Q2, around 70–72cr of revenue was deferred.
•In Q3, deferred revenue stood at about 40cr.
•The company benefited by approximately 30cr in Q3 on net basis.
•After adjusting for deferred revenue, top line growth stands at 26.35% YoY and 53.63% QoQ.
Capacity Expansion & Targets:
•The on-going capacity expansion will be completed between Q1–Q4 FY27.
•Once fully operational, the company expects:
EBITDA margin of 15-16% range and along with 200bps improvement through operational efficiency.
Revenue target of 8,000cr by FY28
•Expanded Capacity utilisation is expected to reach 85% by FY27.
Financial Position:
•The company’s cash position has turned positive, with around 32–35cr in cash and 275cr deposited in banks.
•Management reiterated to become net-debt-free within the next 18 months.
Order Visibility & Approvals:
•The company’s RIP bushing capacity has been approved by PGCIL, enabling it to receive future orders.
•After successful execution of repair orders from Power Grid, the company is expected to receive HVDC transformers order from PGCIL in FY28.
Transformer Market Outlook:
•Global transformer market is growing at a CAGR of 6.17%
•Indian transformer market is growing much faster, at 15%
Impact of Possible Entry of Chinese Companies:
•Recent news suggests the Indian government may ease restrictions on Chinese firms bidding for government contracts.
•However, the impact on the company is expected to be minimal, because:
- There is only one Chinese transformer manufacturing plant in India i.e. TBEA (Tebian Electric Apparatus Co Ltd) and its order book is already full for the next 18–20 months
- Any new Chinese entrant would require to go through stringent approvals process that takes around 12-18 months.
World Bank Issue:
The company is in process to reply on the issue and expect it to get settled in next 2-3 weeks.
CEO Resignation:
Mr. Satyen J. Mamtora, MD will take care of the leadership (CEO) going forward and will think about appointing new CEO if that will be required in future.