Affordable Robotic & Automation Limited — Q2 FY26 earnings call

Call held 31 Oct 2025

Management summary

Affordable Robotic & Automation Limited reported a significant turnaround in Q2 FY26, achieving positive PBT and PAT on both standalone and consolidated bases, driven by cost optimization and integration business. The company holds a robust order book of ₹141 crores, with strong traction for its HUMRO mobile robots in the US market. Management is focused on customer acquisition, product development, and expanding its presence in the US and eventually Europe, while managing competitive pressures and ensuring efficient order execution.

Highlights

  • Q2 Standalone PBT turned positive at ₹4.38 crores, and PAT at ₹4.18 crores, compared to negative figures last year.

  • H1 Standalone PAT turned positive at ₹58 lakhs, compared to ₹8 crores negative last year.

  • H1 Consolidated PAT turned positive at ₹87 lakhs, compared to ₹12.28 crores negative last year.

  • Order book stands at ₹141 crores, expected to be delivered by year-end, with ₹105 crores booked in H1 FY26.

  • HUMRO (mobile robotics subsidiary) shipped 20 robots to USA, with 6 integrations started, showing strong traction.

Concerns

  • Delivery time for orders is 3-5 months, leading to potential spillover of current orders into the next financial year.

  • Anticipated price war in the US warehouse automation market in 3-6 years.

  • Consolidated entity was loss-making in previous years due to development costs, now turning profitable.

Key financials

2 periods

Q2

  • Standalone Revenue
    ₹26 Cr
    YoY +18.2% QoQ +36.8%
  • Standalone EBITDA Margin
    23%
  • Standalone PBT
    ₹4.38 Cr
  • Standalone PAT
    ₹4.18 Cr

H1

  • Standalone Total Income
    ₹44.5 Cr
    YoY +8.5%
  • Standalone PAT
    ₹0.58 Cr
  • Consolidated PAT
    ₹0.87 Cr

What they filed

Q1 FY27: revenue down 51.5%, net profit down 33.3% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue41 35 84 19 24 −41%16 −54%50 −40%9 −52%
EBITDA-5 6 14 -2 4 +183%2 −66%10 −26%-3 −62%
Net profit-8 4 9 -4 4 +153%0 −92%6 −36%-5 −33%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Welding Automation
    35% Gross Margin
  • Car Parking
    20% Gross Margin
  • Third Vertical (Exports/HUMRO)
    40% Gross Margin

Order book

high confidence

Total value

₹141 Cr

as of 2025-09-30 quantified

Execution

expected to be delivered before this year end, but some might spill over

Composition

Mix 3 products
  • Welding Automation 41.1%
  • Car Parking 41.1%
  • Automation (HUMRO) 18.4%

Share of order book by product

The company has a robust order book of ₹141 crores as of September end, with ₹105 crores booked in H1 FY26. While the current order book is expected to be delivered by year-end, some orders might spill over into the next financial year due to delivery timelines. The company is currently overbooked for the next four months and cannot take new orders for this year.

Source: Q&A

Capital allocation

high confidence
  • Debt Gross ₹55 Cr
    What is the total debt level of the company, long term and short term both, If somebody can put the number maybe in the chat that is also okay It's both combined around the console level. We have around 55 Crores.
  • M&A AA category of welding Joint venture · Announced

    to enter into AA category of welding where ARAPL was not there.

    Also, we have done a joint venture, a JV thing to enter into AA category of welding where ARAPL was not there.
  • M&A ARAPL RAAS Private Limited (HUMRO subsidiary) Investment · Announced · Consideration ₹[object Object] (mixed)

    new investment around 80 Crores into the subsidiary of ARAPL RAAS Private Limited.

    Promoter provided an interest-free loan of ₹26 crores to ARAPL, convertible to equity or warrants at a later date, to fund urgent orders in the subsidiary.

    Then for RAAS, HUMRO, we have already declared this to ARAPL board and approved for the proposal of new investment around 80 Crores into the subsidiary of ARAPL RAAS Private Limited. As a part of the plan, our company promoter Mr. Milind Padole has already given an interest free loan of around 26 Crores. This is with a provision to convert into, convert this into equity or warrants at the later date.

Guidance & targets

Growth

  • Overall Growth Growth · year-on-year basis · High confidence minimum 50%
    So we are targeting minimum 50% growth year-on-year basis.

    — Mr. Dakshnamurthy Kalidas

  • Welding Automation & Car Parking CAGR Growth · Medium confidence 17-20%
    the welding automation and the parking, we expect to grow by, you know, 17 to 18% or 20% CAGR

    — Mr. Milind Padole

  • HUMRO Growth Growth · FY27 · High confidence J curve
    the HUMRO can see a J curve, because that's a product business.

    — Mr. Milind Padole

Revenue

  • Car Parking Revenue Revenue · next three to four years · Medium confidence double
    you mentioned that you are trying to double the revenue for this particular segment for the next three to four years.

    — Mr. Prerak Gandhi (referencing management)

  • HUMRO Revenue Potential Revenue · Medium confidence 30-40 million
    So close to, you know, 30 million. Yeah, 30 million, 30 to 40 million.

    — Mr. Milind Padole

Valuation

  • Company Valuation Valuation · next 4 to 5 years · Low confidence billion-dollar
    we want to be a billion-dollar valuation company in next 4 to 5 years.

    — Mr. Milind Padole

Capacity

  • HUMRO Robots Annual Capacity Capacity · annually · High confidence 250 to 300 robots
    So full scale, we have a capacity of around 250 to 300 robots annually.

    — Mr. Milind Padole

Capex

  • Capex Spending Capex · till FY27 results · High confidence no CAPEX
    Land and manufacturing, we will only do after FY27 results. So till that time, no spending on the CAPEX.

    — Mr. Milind Padole

What to watch in Q3 FY26

Promoter Loan Conversion to Equity

later date, after restriction period
Current ₹26 crore interest-free loan to ARAPL
Target Conversion into equity or warrants

Why it matters

This conversion will impact the capital structure and ownership of the company and its subsidiary.

As a part of the plan, our company promoter Mr. Milind Padole has already given an interest free loan of around 26 Crores. This is with a provision to convert into, convert this into equity or warrants at the later date.

Risks & concerns

  • Price war in warehouse automation

    medium

    Management anticipates a price war in the US warehouse automation market in 3-6 years as the product matures, but states they are preparing for it.

    Definitely, there will be price deflection; there will be price war, three years, four years down the line as this product matures. But we are getting ready for that price war also

    Management acknowledged

  • Competition for R&D funding against well-funded US companies

    medium

    Analyst raised concern about competing with well-funded US companies for R&D. Management acknowledged limited funds but emphasized leveraging low-cost Indian engineering talent and frugality.

    So my second question is like, since we are a small company and struggling to fund R&D. So like if you see in US, there are like a lot of companies with potential billions of dollars in funding. So how can we compete with those kinds of companies with unlimited amount of money for R&D and all?

    Analyst downplayed

  • Cyclic nature of business

    low

    Management noted the cyclic nature of their business, leading to cost optimization efforts by reducing fixed costs and relying on temporary manpower/vendors during demand increases.

    So, what we have tried to do is, due to cyclic nature of our business, we have tried to reduce our fixed cost and whenever you know the order increases, we will have temporary manpower or you know the vendors.

    Management acknowledged

Q&A highlights

7 direct
Promoter Stake Sale and Subsidiary Funding Direct
So I have decided to sell my stake, not in the open market, but to the HNIs in the open market. So we have reached out to some HNIS... which I have given as interest-free loan to the company, ARAPL, which will get converted into the equity whenever that restriction period gets over.

Clarified the reason for promoter stake sale, linking it to funding the subsidiary's urgent orders and future equity conversion.

Asked by Mr. Kaustav Bubna

Rationale for ₹80 Crore Investment in HUMRO Subsidiary Direct
So most of it is for the customer acquisition and, you know, part of it like 1 million, 8 to 9 Crores will go into the product sharpening or the product development, right and rests 2 million, close to 2 million to, you know, 3 million will go into inventory and 2 to 3 million is like, you know, 24 Crores or 25 Crores will go into the inventory and then part of it is, you know, contingency and rest is, you know, the market acquisition cost, the marketing cost and the OPEX cost of US and part of India.

Provided a detailed breakdown of how the significant investment in the HUMRO subsidiary will be utilized across various strategic areas.

Asked by Mr. Tushar Khurana

HUMRO Business Model and Financing Direct
So, we have all models. It is not pay-per-use first. That model is still not launched. But we have RAS model, RAS when we say is, you know, lease-to-own or the fixed lease... So, these are the three models. Pay-as-you-use, we have still not launched, though we keep on marketing, but we have not given to any customer.

Clarified the different business models offered by HUMRO and the current status of the pay-per-use model, along with financing strategies.

Asked by Mr. Rashad

Justification for Mercedes-Benz Purchase Direct
So, when we are doing, you know, targeting 300 Crores, we need a car for customers or visitors or investors and the old car is like 10 years old, which is like almost, you know, so there was a new car requirement and that was bought, right.

Addressed a specific concern about company expenses, providing a practical business rationale for the purchase.

Asked by Mr. Ketan

Order Book and POC Clarification for HUMRO Partial
So, four to five robots were for the POC, but the rest is there for commercial sale. But we have to prove those and the order which we had received, right. $3 million, not $4 million, $3 million order, what we had received was for 90 days credit and, you know, we were not able to give him the credit at that time.

Clarified the nature of initial robot shipments (POC vs. commercial) and corrected the value of a specific order, highlighting credit terms as a factor.

Asked by Mr. Ketan

Competition with Well-Funded US Companies for R&D Direct
So, Rishil, we are from India, right. So, we know how to be frugal and if you see our journey, so first thing is our R&D thing is almost over... The fortunate part is a lot of engineers, tech engineers. Our costs are very cheap. English speaking, very good tech engineers are available at a low cost. So that is our strength also.

Addressed a critical competitive concern by emphasizing the company's cost-effective R&D approach and leveraging Indian talent.

Asked by Mr. Risheel

Explanation of FY27 J-Curve Growth for HUMRO Direct
First, you need to approach them and such big customers, you know, to approach them itself takes two to three months... Then is the second thing is you have to do a POC, which again takes, you know, two to three months... Then they will give a small pilot order, which is a paid order... So these, the same customers are going to give you the big orders, you know, after this. So that is how we are expecting the bigger J-Curve, if that satisfies.

Provided a detailed, step-by-step explanation of the sales cycle and customer acquisition process that underpins the projected exponential growth for HUMRO.

Asked by Mr. Ketan

Product Mix Impact on Margins Direct
Margin improvement will be there, Tushar, on console level since we have high margins on this product-based business from Humro.

Clarified that the product mix, particularly the high-margin HUMRO business, is expected to drive overall margin improvement at the consolidated level.

Asked by Mr. Tushar Khurana

2 min read 5 chapters

Detailed narrative

Financial Turnaround Driven by Cost Optimization

Affordable Robotic & Automation Limited achieved a significant financial turnaround in Q2 FY26, with standalone PBT reaching ₹4.38 crores and PAT at ₹4.18 crores, a notable improvement from negative figures in the prior year. This positive shift was primarily attributed to continuous cost optimization efforts, including re-engineering processes and using different materials to reduce primary cost factors. The company also focused on reducing fixed costs, such as employee expenses, to manage the cyclic nature of its business, aiming for a 9% EBITDA margin for H1 standalone and 10-15% consolidated margin with the subscription model.

Robust Order Book and Execution Outlook

The company reported a strong order book of ₹141 crores as of September end, with ₹105 crores booked in H1 FY26. This includes ₹58 crores in welding automation, ₹58 crores in car parking, and ₹26 crores in automation (HUMRO). Management expects to deliver the majority of this order book by the end of the current financial year, though some deliveries might spill over into the next. The company is currently operating at full capacity for the next four months, indicating strong demand and limited ability to take on new orders for the immediate future.

Strategic Expansion of HUMRO Subsidiary in the US Market

Affordable Robotic & Automation Limited is making significant strides with its HUMRO mobile robotics subsidiary, having shipped 20 robots to the USA and commenced 6 integrations. The company plans a new investment of ₹80 crores into ARAPL RAAS Private Limited, primarily for customer acquisition, product development, inventory, and market acquisition costs in the US. Management anticipates a 'J-curve' growth for HUMRO from FY27, driven by converting successful pilot projects with major customers like GXO, FedEx, and Merck into larger orders, leveraging its annual capacity of 250-300 robots.

Product Development and Market Diversification

The company continues to focus on product development across its three verticals: welding automation, warehouse automation, and car parking. In welding automation, the focus is on heavy welding, railway welding, and construction equipment, including a new joint venture for the 'AA category of welding.' Car parking is expanding into new geographies like Pune and Nagpur, with a target to double revenue in this segment over the next 3-4 years. The export-oriented third vertical (HUMRO) is entirely product-based with 40-50% gross margins, targeting US and eventually English-speaking European markets.

Capital Allocation and Funding Strategy

The company's capital allocation strategy prioritizes customer acquisition and product development, with no significant CAPEX planned until after FY27 results. To support the HUMRO subsidiary's growth and urgent orders, the promoter has provided an interest-free loan of ₹26 crores, which will be converted into equity or warrants later. The consolidated debt stands at approximately ₹55 crores. The company aims to achieve a billion-dollar valuation within the next 4-5 years, supported by its growth strategies and efficient capital deployment.

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