Chamunda Electrical Ltd — Q4 FY25 earnings call

Call held 13 Jun 2025

Management summary

Chamunda Electrical Limited reported a strong Q4 FY25, with revenue reaching ₹25 crores and PAT margin improving to 13.27%. The company successfully completed its IPO, which was oversubscribed 738 times, raising ₹14.6 crores, used for debt repayment, working capital, and equipment. Management highlighted a robust ₹64 crores order book and plans for significant solar capacity expansion to 4.4 MW by March 2026, alongside NABL certification for its testing division.

Highlights

  • Revenue of ₹25 crores in FY25, up 25% YoY from ₹20 crores in FY24.

  • PAT margin improved to 13.27% in FY25 from 11.5% in FY24.

  • IPO oversubscribed 738 times, raising ₹14.6 crores.

  • Company is now debt-free, utilizing IPO proceeds for debt repayment.

  • Solar capacity planned to expand to 4.4 MW by March 2026, a significant growth driver.

Concerns

  • Analyst concern regarding margin sustainability given lower margins (4% EBITDA) in FY22, which management attributed to solar depreciation.

Key financials

2 periods

Headline

  • Revenue
    ₹25 Cr
    YoY +25%
  • PAT Margin
    13.3%

FY24

  • PAT
    ₹2.28 Cr
  • PAT Margin
    11.5%
  • EBITDA Margin
    23.4%

What they filed

Q4 FY26: revenue up 43.1%, net profit up 8.6% against the same quarter last year.

₹ Cr · quarterly
Line itemQ4 FY24Q2 FY25Q4 FY25Q2 FY26Q4 FY26
Revenue11 10 15 17 15 +43%
EBITDA2 1 4 3 2 −6%
Net profit1 1 3 2 1 +9%
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

Share of Revenue
₹25.56 Cr Total
  • Operation & Maintenance (FY25) ₹19.34 Cr 75.7%
  • Sub-station Commissioning (FY25) ₹3.5 Cr 13.7%
  • Testing (FY25) ₹2 Cr 7.8%
  • Solar (FY25) ₹0.72 Cr 2.8%

Capital allocation

high confidence
  • Capex ₹12 Cr IPO funds and internal accruals
    • Purchasing kits and machinery (from IPO funds) ₹1.5 Cr
    • Solar plant expansion (0.5 MW addition) ₹1.5 Cr
    • Solar plant expansion (4 MW target) ₹12 Cr
    • NABL certification expansion (calibration)
    • O&M and whole substation commissioning
    Now, I want to share something regarding the plantation of fund received from this IPO... The first thing was our purchasing of kits and machinery... The second one was the repayment of debt... And the third one is our working capital requirement... if we are planning for 4 megawatts, then our costing will be approximately INR12 crores to INR15 crores. Which will be capex utilizing 2025-26 and 2026-27 equally.
  • Debt Gross ₹0 Cr · Net ₹0 Cr · 0.0× EBITDA
    • Repayment All debts repaid using IPO funds
    The second one was the repayment of debt. So, our company has successfully paid all the debts. So, we are a debt-free company now.
  • Liquidity Liquidity disclosed IPO funds utilized for working capital requirements.
    And the third one is our working capital requirement. So, that we have utilized.

Guidance & targets

Order Book

  • Order Book Execution (1st year) Order Book · Next 12 months · High confidence ₹20 crores
    first year we are expecting around INR20 crores execution.

    — Management

  • Order Book Execution (2nd year) Order Book · Following 12 months · High confidence ₹24 crores
    Second year, we are expecting INR24 crores and remaining in third year.

    — Management

Profitability

  • PAT Margin Profitability · Ongoing · Medium confidence Increase
    our PAT margin was increasing slightly. So, on year-on-business, it will increase, but it will not decline on rigorous values.

    — Management

  • EBITDA Growth Profitability · FY26-FY27 · High confidence 25.32%
    EBITDA, we are expecting 25.32% growth in FY '25, '26. And, in PAT, we are expecting 13.50% growth.

    — Hardik Patel

  • PAT Growth Profitability · FY26-FY27 · High confidence 13.50%

    — Hardik Patel

  • PAT Margin Profitability · FY26-FY27 · High confidence 13.50%
    In PAT, what are you expecting? 13.50%.

    — Hardik Patel

Capacity

  • Solar Capacity Capacity · by March 2026 · High confidence 4.4 MW
    we are planning to increase our capacity to 4.4 megawatt by March 26.

    — Hardik Patel

  • Solar Capacity Increment Capacity · by March 2026 · High confidence 150%
    then the capacity increment will be 150% by March 2026.

    — Hardik Patel

Revenue

  • Solar Revenue (from 0.5 MW addition) Revenue · by March 2026 · High confidence ₹1 crore
    we are expecting that by March 26, we will get revenue of INR1 crores from solar. Because, our new capacity of 0.5 megawatt will be operational by December.

    — Management

  • Testing Revenue (after NABL) Revenue · Post NABL certification · High confidence ₹2.16 crores

    Previously ₹2 crores → ₹2.16 crores

    the testing, after the certification of NABL, will increase by 20%. So it is INR2 crores now, it will increase to INR2.16 crores.

    — Hardik Patel

  • Testing Equipment Revenue Revenue · Per annum · Medium confidence ₹0.70-0.75 crores
    if all the PSUs of the potential customers come after that, then according to me, our revenue will increase by INR70 lakhs-INR75 lakhs.

    — Hardik Patel

  • Total Revenue Revenue · FY26 · High confidence ₹31-33 crores
    In 2026, we are planning that our revenue will be INR31 crores to INR33 crores.

    — Hardik Patel

  • Total Revenue Revenue · FY27 · High confidence ₹35.50 crores
    We are expecting INR35.50 crores. Revenue in '26, '27.

    — Hardik Patel

  • Total Revenue (higher side) Revenue · FY27 · Medium confidence ₹38 crores
    And in '26, '27, we are expecting that it will increase to INR38 crores on higher side.

    — Hardik Patel

Growth

  • O&M Growth Growth · Ongoing · Medium confidence 20%
    So in O&M, you can expect a growth of 20%.

    — Hardik Patel

  • Testing Growth Growth · Ongoing · Medium confidence 25-30%
    And in testing, according to me, you will see a growth of 25%-30%.

    — Hardik Patel

What to watch in Q1 FY26

NABL certification for testing lab

by December 2025
Current Audit completed, provisional certificate pending
Target Provisional certificate received

Why it matters

Unlocks higher revenue potential and broader client base for testing services.

before December '25, we will receive a provisional certificate from NABL.

Risks & concerns

  • Client concentration / dependency on government contracts

    medium

    Analyst questioned how the company mitigates risks from high reliance on government orders.

    Analyst acknowledged

  • Margin sustainability post-IPO

    medium

    Analyst expressed doubt about maintaining 25% EBITDA margin, citing lower historical margins and potential IPO-related inflation.

    Analyst acknowledged

Q&A highlights

8 direct
Execution timeline of ₹64 crores order book Direct
first year we are expecting around INR20 crores execution. Second year, we are expecting INR24 crores and remaining in third year.

Provides clarity on the revenue recognition schedule for the current order book.

Asked by Sahil Chopra

Sustainability of 12-13% PAT margins Direct
These margins are sustainable. This margin will increase but not decrease.

Addresses analyst concern about margin volatility and provides confidence in future profitability.

Asked by Sahil Chopra

Payment cycle from government clients (GETCO) Direct
they give us the payment twice. Right? They give it three times. One, you get it in October. Then after, we are expecting in January, and the last payment is received in March.

Explains the working capital cycle and payment reliability from the primary government client.

Asked by Sahil Chopra

Revenue model for solar division Direct
we have a PPA of 25 years with them, right. So that revenue will continue for 25 years.

Clarifies the long-term, recurring revenue nature of the solar business.

Asked by Sahil Chopra

IPO fund utilization Direct
the first thing was our purchasing of kits and machinery... The second one was the repayment of debt... And the third one is our working capital requirement.

Details how the IPO proceeds were deployed, highlighting debt-free status and investment in growth.

Asked by Abhishek

Risk mitigation for government contracts Direct
we are working with all ex-officers. So, we deal with them and we have a legal team, which deals with all these issues... we are up to date with all these issues.

Addresses concerns about dependency on government contracts and regulatory changes.

Asked by Aditya Mangal

Employee cost ratio relative to revenue Direct
we are at peak at our capacity. We have 118 substations now, right? So, this is our peak now... if it is more, then we will increase the number of employees.

Explains the current employee structure and how it scales with business growth.

Asked by Manoj Sharma

EBITDA margin sustainability (25%) Direct
In our previous track record, in 2024, our revenue was INR20 crores. On that, our EBITDA margin was 23.40%. Around 25%... PET margin was consistent in the previous year also in '24 also when IPO was not there in '25 if IPO is there then also it is consistent.

Reassures analysts about the company's ability to maintain strong operating margins, addressing skepticism related to IPO timing.

Asked by Manoj Sharma

3 min read 7 chapters

Detailed narrative

Q4 FY25 Performance and IPO Success

Chamunda Electrical Limited reported a strong close to FY25, with revenue increasing to ₹25 crores from ₹20 crores in FY24, representing a 25% growth. PAT margin also saw an improvement, rising to 13.27% in FY25 from 11.5% in FY24. The company's recent IPO was significantly oversubscribed by 738 times, attracting ₹7,100 crores against a demand of ₹14.6 crores, demonstrating strong investor confidence.

Strategic Utilization of IPO Proceeds

The ₹14.6 crores raised through the IPO were strategically deployed. Key uses included the purchase of new kits and machinery (approximately ₹1.5 crores for testing equipment), repayment of all outstanding debt, making the company debt-free, and bolstering working capital requirements. This capital injection is crucial for supporting ongoing projects and future growth initiatives, particularly in the testing and solar divisions.

Operational Segments and Revenue Mix

For FY25, the company's revenue mix was diversified across its core segments. Operation & Maintenance (O&M) contributed ₹19.34 crores, while the solar division generated ₹0.72 crores (72 lakhs). The testing division added ₹2 crores, and sub-station commissioning accounted for ₹3.50 crores. Management highlighted a current order book of ₹64 crores, with an expected execution of ₹20 crores in the first year and ₹24 crores in the second year.

Solar Business Expansion

Chamunda Electrical is actively expanding its solar energy footprint. The company currently operates 1.2 MW of solar capacity and recently secured approval for an additional 0.5 MW, bringing the total to 1.7 MW. There are ambitious plans to further increase solar capacity to 4.4 MW by March 2026, with an estimated investment of ₹12-15 crores for the 4 MW expansion over FY26-FY27. This segment is expected to contribute significantly to future recurring revenue, with a 25-year Power Purchase Agreement (PPA) in place.

NABL Certification and Testing Services

The company's testing division is undergoing NABL certification, with the audit completed and provisional approval for 250 out of 350 scopes expected by December 2025. This certification is anticipated to increase testing revenue by 20% to ₹2.16 crores and open doors to a broader client base, including PSUs like ONGC, BPCL, and HPCL, which require NABL-certified services. New testing equipment, costing approximately ₹1.5 crores, is also on order from Germany, projected to generate ₹0.70-0.75 crores (70-75 lakhs) in annual revenue.

Future Outlook and Margin Sustainability

Management provided optimistic guidance, targeting total revenue of ₹31-33 crores for FY26 and ₹35.50-38 crores for FY27. They project an EBITDA growth of 25.32% and PAT growth of 13.50% for both FY26 and FY27, with PAT margins expected to remain sustainable at 13.50%. The company emphasizes its asset-light service industry model, which contributes to stable margins, and its long-standing relationships with government clients like GETCO.

Working Capital Management

The company maintains a robust working capital cycle, particularly with its government clients. Payments from GETCO are typically received in three tranches (October, January, March). For testing services, payments are received within 30 days. The solar division operates on a monthly PPA system. Management noted that trade receivables for March 2025 were ₹5.31 crores, with 70-80% from government bodies, considered secured. Trade payables were minimal at ₹0.10-0.11 crores (10-11 lakhs), indicating efficient cash flow management.

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