Rishabh Instruments Ltd Q1 FY26 Earnings Analysis

- Expecting 15-20% growth in electronics business (India and Lumel SA) next year. - Domestic India (Rishabh India) sales expected to grow around 20%. - Export growth from India anticipated at 12-13%. - Lumel SA revenue projected to grow around 14-15%, potentially conservatively taken as 15%. - Overall company aiming for improved growth rates possibly exceeding their usual 12-15%, striving for faster growth. - Electronics division growth supported by capacity expansion via new state-of-the-art SMT lines in Nashik and Poland. - EMS (Electronics Manufacturing Services) business in Lumel SA showing 100% growth, expected to continue strong. - Non-automotive aluminum die-casting growth targeted modestly at 4-5%, but automotive die-casting remains challenging. - Overall optimistic about better performance in the coming year compared to the current year.

- **Electronics Business Growth:** Expect 15%-20% growth in electronics segment (Rishabh India and Lumel SA) with EBITDA margins around 15%-20%. Targeting ~INR 100 crores EBITDA next year. - **Domestic India:** Domestic business expected to grow ~20%, exports around 12%-13%. - **Lumel SA:** Anticipates 14%-15% revenue growth with strong margins (20% EBITDA). - **Aluminium Die-Casting:** Currently facing challenges, targeting break-even in FY '26 with strategic shift from automotive to non-automotive sectors for better profitability. - **Overall EBITDA:** Consolidated EBITDA expected to improve as aluminium losses reduce and electronics growth continues. - **Profitability:** Optimistic that FY '26 and beyond will see improved earnings, supported by new products, capacity expansion (SMT lines), and diversifying customer base. - **EPS:** Positive trajectory linked to steady revenue growth and margin expansion, with management confident of a better performance compared to the current year.

- Ongoing capex in Rishabh India: Construction of two buildings with an investment of approx. INR 50-60 crores to increase production capacity. - Lumel SA: Adding an SMT line with a capex of about INR 15-20 crores, 40% of which is supported by innovation projects. - Total expected capex over next 2 years is around INR 70-80 crores. - No additional capex planned in Lumel Alucast currently. - Strategic investment includes acquiring MICROSYS (Czech Republic-based SCADA software company) in August 2024 to provide comprehensive solutions alongside high-end products. - Expansion of EMS capacity through installation of state-of-the-art SMT lines in both Nashik (India) and Poland to bolster production capabilities.

- The transcript does not mention any current or planned fundraising through debt or equity. - The company highlights that on a consolidated level, they remain net debt-free with a strong balance sheet. - Net cash and cash equivalents as of March 31, 2025 stand at INR 1,022 million. - There is no reference to new debt or equity issuance or fundraising plans in the discussed financial year or near future. - The focus appears to be on organic growth, operational improvements, and strategic acquisitions (e.g., MICROSYS acquisition in Czech Republic), not raising fresh capital.

- Specific details on the current or expected order book/pending orders are not explicitly mentioned in the provided transcript. - However, the management indicates optimism about growth and improving business conditions. - Discussions highlight ongoing price negotiations and contract renewals, especially in aluminium die-casting, implying active order management. - New projects with non-automotive customers are being pursued to fill capacity in die-casting. - The EMS business is expanding with new SMT lines and shifting supply chains from China, indicating an increasing order intake. - Lumel SA's growth is expected at around 15%, showing healthy demand. - Overall, the company is focused on securing orders through strategic customer engagements and capacity expansions to drive double-digit growth. - The cautious approach with automotive customers reflects controlled order visibility with contract terms being renegotiated.