Permanent Magnets Ltd Q1 FY27 Earnings Analysis

- Alloys division expected to scale up commercial production significantly in FY27, potentially 3 to 4 times FY26 volumes. - Relays project commercial ramp-up delayed, now expected from second half (H2) of FY27 with estimated revenues of INR 25-50 crores at 100% utilization for initial 5 million capacity. Capacity to increase based on customer orders. - Quantum Magnetics Phase 2 capex and commercial sales planned for Q3/Q4 FY27; long-term goal of 5,000-tonne capacity with potential revenues between INR 3,000-4,000 crores. - Overall revenue growth guidance for FY27 expected in the range of 20% to 30%, driven by orders in Alloys and Relays segments. - Outlook beyond FY27 to scale up depends on successful implementation of capacities, customer adoption, and government incentives (PLI scheme evaluation ongoing). - Market expansion potential in smart meter components (addressable market ~INR 6,500-7,000 crores) and Quantum Magnetics.

- FY27 growth expected between 20% to 30%, possibly higher based on order wins in Alloys and Relays businesses. - EBITDA margins anticipated to stay stable at 15%-18% in FY27. - Alloys division expected to ramp up 3-4 times FY26 revenue in FY27, driven mainly by oil & gas segment. - Relays commercial ramp-up planned for H2 FY27 with projected revenues of INR 25-50 crores at 100% utilization. - Quantum Magnetics to begin commercial sales from Q4 FY27, with long-term capacity planned at 5,000 tonnes targeting INR 3,000-4,000 crores revenue. - Capex plans of INR 40-50 crores for PML standalone and similar for Quantum over 18 months, funded by a mix of internal accruals, debt, and equity. - Growth dependent on customer adoption, market developments, and government incentives (under evaluation). - Management targeting scaling up commercial operations across key growth pillars (Alloys, Relays, Quantum Magnetics) to drive profits in coming years.

- Capex for FY27 includes INR 40-50 crores for Permanent Magnets Limited (PML) standalone business and another INR 40-50 crores planned for Quantum Magnetics subsidiary. - Around $5 million (approx. INR 40 crores) is planned as Quantum Magnetics' contribution over 18 months. - Capex funding will be a mix of debt and equity; internal accruals also expected to be used. - New factory consolidation: INR 20 crores spent to combine 6 plants near Vasai on Ahmedabad highway; land already acquired. - Relays plant phase-wise investment: initial setup with 5 million capacity (INR 25-50 crores revenue expected at 100% utilization in H2 FY27), expansion to 10 million capacity depending on orders. - Quantum Magnetics Phase 2 capex (block cutting, machining, surface treatment) expected to be implemented by Q3-Q4 FY27, with future powder to block manufacturing investments under planning. - Evaluation ongoing regarding participation in government PLI schemes for rare earth segment.

- The company plans capex of INR 40-50 crores for Permanent Magnets Limited (PML) and another INR 40-50 crores for Quantum Magnetics over the next ~18 months. - Funding for these investments will be a combination of debt and equity, though the final mix is yet to be decided. - The company has already taken an ECB (External Commercial Borrowing) of $5 million to fund capex in subsidiaries, contributing to increased consolidated debt. - Management indicated that fundraising could involve both internal accruals and external financing but no specific imminent fundraising event was confirmed. - No new debt or equity raise was explicitly announced during the call; the company is still finalizing the funding plan based on evolving business needs and capex schedules.

- The Relays plant is being set up phase-wise with an initial capacity of 5 million units, potentially increasing to 10 million based on orders received. - Ramp-up of Relay production depends on successful pilot testing and customer approvals. - Expected revenue from the Relays project is INR 25 crores to INR 50 crores at 100% utilization starting second half (H2) of FY27. - Sales judgment for Relays after September is based on current customer indications but may change depending on customer adoption speed. - For Quantum Magnetics, Phase 2 capex is expected by Q3/Q4 FY27, with production scaling planned in a phased manner. - Alloy division is seeing ramp-up in commercial production with potential 3-4 times growth in FY27 over FY26. - No specific consolidated order book value disclosed, but growth outlook is tied to commercialization progress and customer demand.