Skip to content

    Alicon Castalloy Limited

    ALICON
    Automobile and Auto Components·16 Feb 2026
    Management Summary

    Alicon Castalloy Limited reported a stable Q3 FY26 performance with 10% YoY revenue growth, driven by strong domestic demand in PV and CV segments. However, profitability was impacted by global headwinds, operational disruptions like a cyber-attack on a key customer, and one-time costs. The company maintains a robust order book and anticipates improved performance and order inflows from global markets in the coming quarters.

    Highlights

    5

    • Q3 FY26 Revenue of ₹430 crore, up 10% YoY compared to ₹393 crore in Q3 FY25.

    • Q3 FY26 EBITDA increased by 34% YoY to ₹47.2 crore.

    • Q3 FY26 PAT increased by 322% YoY to ₹3.3 crore compared to ₹0.8 crore in Q3 FY25.

    • Maintained a healthy order book of approximately ₹9,100 crore, with an expected FY29 exit revenue of ₹3,500 crore.

    • Domestic PV business recorded healthy growth of 12% YoY and CV business delivered 13% YoY growth in Q3.

    Concerns

    5

    • Q3 FY26 EBITDA margin moderated to 10.9% from 12.9% in Q2 FY26.

    • Q3 FY26 PAT declined 76% QoQ to ₹3.3 crore from ₹14 crore in Q2 FY26.

    • European subsidiary incurred losses due to a cyber-attack on a UK OEM customer and demand headwinds for a US commercial vehicle customer, leading to 25-26% volume decline in specific categories.

    • Exceptional item of ₹5 crore recognized in Q3 relating to the implementation of the new labour code.

    • Asset impairment of ₹1.5 crore and additional manpower costs of ₹2 crore impacted Q3 profitability.

    What Changed2

    vs Q4 FY26

    Guidance items5 → 8 (+3)Risks discussed4 → 5 (+1)

    Key financials

    Single quarter

    06 metrics
    1. 01Revenue₹430 Cr+10%YoY
    2. 02EBITDA₹47.2 Cr+34%YoY
    3. 03EBITDA Margin10.9%-15.5%QoQ
    4. 04PAT₹3.3 Cr+3.2%YoY
    5. 05PBT (pre-exceptional)₹11 Cr+9%YoY

    Order Book

    high confidence

    Total Value

    ₹ 9,100 crores

    as of 2025-12-31

    quantified

    Execution

    execution of the new order book as well as the end of the existing products, so both are happening.

    Composition

    ICE(product)
    Carbon-Neutral (EV)(product)
    Global(geography)
    Domestic(geography)
    CV(segment)
    PV(segment)

    "The company has a healthy order book and expects it to grow from the next year, especially with renewed inquiries from the US market."

    Source:
    Prepared remarks

    Capital allocation

    2
    high confidence
    CategoryHeadline
    Capex

    ₹28 crores this quarter · ₹125 crores (FY26) planned

    Debt

    Debt disclosed

    Guidance & targets

    8
    CategoryTargetPriority
    Revenue
    Domestic Revenue Growth
    10% to 12% improvement
    		Medium
    Revenue
    Exit Revenue from Order Book
    Rs. 3,500 crore
    		High
    Revenue
    New Orders Revenue (Q3 wins)
    Rs. 300 crore to Rs. 350 crore
    		Medium
    Margin
    EBITDA Margin
    12.5% to 13%
    		Medium
    Margin
    EBITDA Margin
    12% to 12.5%
    		Medium
    Margin
    Long-term EBITDA Margin
    13% and to reach the level of 14%
    		Low
    Capex
    Capital Expenditure
    Rs. 125 crore to Rs. 130 crore
    		High
    Operations
    JLR eAxle Project Full Utilization
    Full utilization
    		Medium

    Q4 FY26 Domestic Revenue Growth

    Next quarter (Q4 FY26 results)
    CurrentQ3 FY26 domestic business delivered strong double-digit growth.
    Target10-12% improvement in Q4.

    Why it matters

    Verifies management's expectation of sustained domestic momentum and recovery.

    approximately, we can say 10% to 12% further improvement in the quarter 4.

    How to verify

    key_financials.metrics[label='Revenue'].qoq_growth

    Risks & concerns

    5
    RiskSeverity

    Supply-side challenges (semiconductor availability, rare earth magnets)

    Constrained semiconductor availability and difficulties in importing rare earth magnets are limiting production ramp-up. — Management acknowledged

    medium

    Global volatility and tariff-related actions

    Uncertainty from tariff-related actions weighed on sentiments and volumes from international customers, leading to a muted quarter for global operations. — Management acknowledged

    medium

    Operational disruptions for European and US customers

    A cyber-attack on a UK OEM customer disrupted production for 5 weeks, and a US commercial vehicle customer faced demand headwinds with 25-26% volume decline in specific categories, impacting Alicon's sales and profitability. — Management acknowledged

    high

    Underutilization and losses from JLR eAxle project

    The complex JLR eAxle EV project is delayed by the customer, leading to underutilization and losses, though full ramp-up is expected by July/August 2026. — Management acknowledged

    medium

    Metal price increases

    Around ₹6-7 crore of additional cost due to metal price increases impacted gross margins in Q3, though partially passed on to customers. — Management acknowledged

    low

    Q&A highlights

    8

    “with our old systems, old existing facilities, so easily, we can generate Rs. 200 crore from their existing facilities. But completely depends on the product.”

    Clarifies that capacity utilization is not a direct linear driver of revenue due to product complexity and need for new machinery, but existing facilities can still generate significant revenue.

    asked by Jyoti Singh

    2 min read6 chapters

    Detailed Narrative

    01

    Domestic Market Strength and Global Headwinds

    The domestic automotive market showed strong double-digit growth in Q3 FY26, with PV, CV, and 2-wheeler segments growing by 12%, 13%, and 13% YoY respectively. This momentum led to Alicon's standalone domestic business delivering strong double-digit growth. However, global operations faced headwinds from volatility, tariff-related actions, and seasonally softer markets, with North America down 2% and UK down 19% YoY, impacting overall volumes from international customers.

    02

    Q3 FY26 Financial Performance Overview

    Alicon Castalloy reported Q3 FY26 revenue of ₹430 crore, a 10% YoY increase from ₹393 crore in Q3 FY25, and a marginal 0.4% sequential growth from Q2 FY26. EBITDA grew 34% YoY to ₹47.2 crore, but the EBITDA margin moderated to 10.9% from 12.9% in Q2 FY26. Profit after tax stood at ₹3.3 crore, a 322% YoY increase but a 76% QoQ decline from ₹14 crore in Q2 FY26.

    03

    Profitability Impact and Exceptional Items

    The moderation in Q3 EBITDA margin was attributed to higher employee costs (an additional ₹2 crore in Q3, with a full-year impact of ₹10 crore), asset impairment (₹1.5 crore), and a less favorable product mix due to lower volumes in higher-value CV components. An exceptional item📎 of ₹5 crore related to the new labour code also impacted PAT. Metal price increases added ₹6-7 crore in costs, though partially offset by customer pass-throughs.

    04

    Operational Challenges and Strategic Initiatives

    The European subsidiary incurred losses due to a cyber-attack on a UK OEM customer, disrupting supplies for 5 weeks, and demand headwinds from a US commercial vehicle customer, leading to 25-26% volume decline in specific categories. The JLR eAxle EV project, a complex part, is currently underutilized due to customer delays, impacting profitability but is expected to ramp up by July/August 2026. The company is also investing in digital process controls and automation at Pune facilities.

    05

    Order Book and Future Outlook

    Alicon maintains a healthy order book of approximately ₹9,100 crore, with an expected FY29 exit revenue of ₹3,500 crore. New orders secured in Q3 include 4 parts (3 ICE, 1 Carbon-Neutral; 3 CV, 1 PV), notably a high-value eAxle housing for a premium German automobile OEM. The company anticipates further order inflow from FY27, especially from the US market, following recent trade agreement frameworks, which are expected to translate into improved opportunities and volumes.

    06

    Capital Expenditure and Margin Guidance

    Capital expenditure for Q3 FY26 was ₹28 crore, bringing the 9-month cumulative to ₹92 crore, with a full-year target of ₹125-130 crore focused on automation, capacity enhancement, and readiness for upcoming programs. Management guided for Q4 FY26 EBITDA margins of 12.5-13% and full-year FY26 margins of 12-12.5%, with a long-term aspiration to reach 13-14%.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.