Eppeltone Ene. Q3 FY26 Earnings Analysis

- Target revenue growth of 30% to 40% in FY26 compared to FY25; optimistic about strong H2 performance to reach this target (Page 13, 17). - Plant capacity utilization currently 50-60%, expected to ramp up with new automated facility mid-FY27 (Page 22). - New facility (60,000 sq ft, fully automated) expected to support ₹500-600 crore annual revenue by FY28 (Page 6, 17). - Company plans to expand product portfolio into gas meters, water meters, railway equipment, and integrated installation services, contributing to revenue growth (Page 17, 26). - Gas meter market forecasted to grow from ₹200-250 crore to ₹1,200 crore in next 5-7 years (Page 18). - Long-term aspiration to achieve 3 to 4 times growth in 3 years, targeting ₹450-500 crore revenue by FY28-FY29 (Page 22). - EPC business eligibility anticipated by February FY26, potential new revenue stream (Page 24).

- **Revenue Growth:** Targeting 30% to 40% growth in FY26 compared to FY25, with expectations for continued growth in the next two years. - **Capacity Expansion:** New fully automated 60,000 sq.ft. facility expected operational by mid FY27, aiming for ₹500-600 Cr revenue at full capacity by FY28. - **Product Diversification:** Revenue from gas meters, water meters, railway equipment to start small in FY26, substantially increasing in FY27. - **EPC Business:** Potential to begin EPC operations by February FY26, with ₹600 Cr in bids pending conversion. - **Efficiency and Margins:** Automation of facilities to improve operational efficiency, likely resulting in EBITDA margin improvement beyond the current ~18%. - **Profitability:** EBITDA margin targeted to sustain or improve, potentially moving towards 20% or above. - **Long-term Vision:** Aspirations to 3-4x revenue in next 3 years, targeting ₹450-500 Cr by FY28-FY29. - **EPS:** Positively impacted by revenue growth, margin improvement, and CapEx funded mainly by internal accruals, with debt managed prudently.

- EEPL plans to invest around ₹12-14 crores in CapEx for a new automated plant (~60,000 sq ft), including RCC and PEB structures. - The new facility will include one additional SMT line alongside the existing two. - The new fully automated plant targets annual revenue potential of ₹500-600 crores. - The new facility is expected to be operational by mid-FY27, with full capacity utilization by FY28. - CapEx funding will primarily come from internal accruals; debt may be taken if needed. - Strategic focus includes geographic expansion, broader product portfolio (gas, water meters, railway equipment), and efficiency improvements through automation. - Investment in R&D continues, with capitalized employee costs (~₹1.4-1.5 crores) for new product development (gas meter, water meter, underslung charger). - The old plant will focus on manufacturing new product lines alongside the new automated plant.

- The new facility CapEx of around ₹12-15 crores is primarily being funded through internal accruals from generated revenue. - If needed, some funding may be raised through bank debt. - There is no explicit mention of any planned or ongoing equity fundraise. - Proceeds from a previous ₹30 crore IPO are being used for working capital, reducing the need for bill discounting and lowering finance costs. - No specific plans for further equity fundraising or large debt expansion were stated in the call.

- Current order book stands at approximately ₹410 crores with an execution period of 18 to 24 months. - The company has submitted new bids totaling around ₹600 crores, with some expected to close in the next month or two. - EPC business bids are in the approval stage; once approved (expected around February FY26), the company will be eligible to quote for tenders. - Conversion of bids to order book is uncertain due to technical, commercial evaluations, and market conditions; could range from zero to full ₹600 crores. - The company aims to maximize order conversions and sees good growth prospects for H2 FY26.