Craftsman Automation LtdQ4 FY26
Craftsman Automation Ltd Q4 FY26 Earnings Call Analysis
Revenue, margin, capex, fundraise and order book outlook from management commentary.
Price: ₹9,252P/E: 51.3Market Cap: ₹20.2K CrSector: Auto Components
Management growth scorecard
Revenue
Category 2
Margin
Category 1
Fundraise
Yes
Order
N/A
Capex
Yes
3 of 4 growth signals are positive.
Full analysisRevenue guidance
Category 2- →Consolidated revenue expected to grow from INR 5,500 crores to around INR 7,000 crores in next financial year, indicating ~27% growth.
- →EBITDA projected to increase from around INR 850 crores to northwards of INR 1,100 crores (approx. 29% growth).
- →EBIT expected to rise from INR 500 crores to about INR 700 crores (40% growth).
- →Bhiwadi alloy wheel plant expected to generate over INR 300 crores revenue, with peak combined capacity of Bhiwadi and Hosur alloy wheel plants at INR 800 crores by FY '27.
- →Kothavadi plant to contribute around INR 150 crores.
- →Stationary engines segment targeting $100 million revenue by FY '29, with initial revenues expected to start post approval gestation.
- →Export of castings (currently imported) to increase, facilitated by machining facilities in India.
- →Automated storage business to reach around INR 500 crores revenue, becoming a top player in India.
- →Overall, growth driven by capacity expansion, new acquisitions, and entry into high-growth segments like stationary engines and alloy wheels.
Margin guidance
Category 1- →Craftsman Automation targets consolidated revenue growth from around INR 5,500 crores to approximately INR 7,000 crores in FY '26, indicating ~27% increase.
- →EBITDA is expected to rise from about INR 850 crores to over INR 1,100 crores (~29% growth).
- →EBIT projected to increase by 40%, from INR 500 crores to INR 700 crores.
- →Powertrain segment growth is expected, with significant acceleration likely from FY '27 onwards.
- →Bhiwadi plant to achieve EBIT neutrality starting Q1 FY '26, with positive EBIT by year-end.
- →Sunbeam subsidiary to become EBIT positive by Q2 FY '26 and EBIT neutral for the full year.
- →Depreciation expected around INR 400 crores for FY '26, with interest cost around 9%-10%.
- →Tax rate expected to remain at normal corporate rates (~25%) except for Sunbeam subsidiary, which may gain INR 100 crores tax benefit over 2-3 years.
- →The company is investing in capacity expansion, indicating short-term leverage but aiming for strong medium-term profit growth.
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Fundraise plans
Yes- →The company recently raised equity through a Qualified Institutional Placement (QIP) totaling INR 1,200 crores, in addition to earlier capital infusions of INR 150 crores each via private equity and IPO, marking substantial equity fundraising.
- →Regarding debt, the consolidated net debt is around INR 1,800-1,900 crores with an interest cost of about 9%-10%.
- →Debt repayment is planned to be linear over 5 to 6 years with a significant reduction expected next year, partly due to the planned sale of the Gurgaon land valued at around INR 300 crores.
- →There is no specific mention of new fundraising through debt or equity beyond the recent QIP and existing debt management plans.
- →Capex for the current and next year suggests internal funding, with no explicit announcement of additional fundraising.
Order book
- →Automated storage order book is full as per the latest update.
- →For automated storage, revenues are from orders received over a year ago due to long gestation (~1+ year) involving new building sites and complex integration.
- →Automated storage year-to-date revenue stands at INR 142 crores for 9 months.
- →Static storage segment revenue is around INR 250 crores for 9 months.
- →Total storage segment revenue approximates INR 400 crores for 9 months, with expected closure at around INR 500 crores for the financial year.
- →Stationary engine business has received orders from 5 of the top 10 global customers.
- →Target revenue for stationary engine segment is approx. $100 million (~INR 800+ crores) by FY '29.
- →Casting and machining orders in stationary engine segment are progressing with customer validations underway, with sample machining started.
- →Alloy wheel plants at Bhiwadi and Hosur fully booked with existing orders.
Capex plans
Yes- →Current year investments totaled INR 1,015 crores:
- → - DR Axion: INR 250 crores for 24% stake balance
- → - Sunbeam: INR 606 crores as optionally convertible debentures (OCD)
- → - Craftsman Germany: INR 154 crores (INR 94 crores acquisition + INR 60 crores working capital)
- →Greenfield capex:
- → - Total INR 700 crores till date
- → - Bhiwadi plant: INR 219 crores (excluding land)
- → - Kothavadi plant: INR 91 crores
- →Capex done at stand-alone Craftsman: INR 700 crores + INR 150 crores expected in next quarter, approx. INR 850 crores for current year
- →Next year's capex guidance: expected to be less than half of current year including maintenance capex
- →Strategic focus on capacity expansion, especially:
- → - Greenfield plants at Bhiwadi and Kothavadi
- → - Modernization plans for subsidiaries like Sunbeam under consideration
How does Craftsman Automation Ltd rank vs peers in Auto Components?
Pro feature1Craftsman Automation Ltd
Rev 2Mar 1
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