Elin Electronics Limited — Q3 FY26 earnings call

Call held 6 Feb 2026

Management summary

Elin Electronics reported strong Q3 FY26 results with double-digit revenue growth and significant EBITDA and PAT expansion, primarily driven by robust performance in fan and home appliance segments. Margins faced pressure from rising raw material costs, but the company expects repricing to mitigate this. The new Bhiwadi plant is on track for May 2026 operations, and the company is actively expanding its customer base and product portfolio, particularly in lighting and motors, while addressing working capital normalization.

Highlights

  • Operating revenue of INR 294 crores, up 10.52% YoY from INR 266 crores.

  • Consolidated EBITDA of INR 11.9 crores, up 56.57% YoY from INR 7.6 crores, with margin expanding to 4.04%.

  • Consolidated PAT of INR 3.8 crores, up 171.4% YoY from INR 1.4 crores.

  • Fan business achieved 100% YoY growth, driven by BLDC ceiling fans.

  • Kitchen and Home Care revenues increased by 330% YoY.

  • Net cash position remains strong at INR 59 crores as of December 25.

Concerns

  • Gross margins impacted by a sharp surge in raw material costs (copper, steel, aluminum).

  • Lighting segment revenue declined by 7.84% YoY to INR 62.3 crores.

  • Personal segment revenue was down 10% YoY due to weak demand in hair straighteners and trimmers.

  • FHP motor segment revenue declined by 18.28% QoQ to INR 45.6 crores.

  • Working capital increased to net 68 days due to higher inventory levels.

Key financials

  1. Operating Revenue ₹294 Cr +10.5%YoY
  2. Consolidated EBITDA ₹11.9 Cr +56.6%YoY
  3. EBITDA Margin 4%
  4. Consolidated PAT ₹3.8 Cr +171.4%YoY

What they filed

Q1 FY27: revenue up 14.1%, net profit down 322.2% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue237 225 244 241 280 +18%250 +11%245 +0%275 +14%
EBITDA8 8 16 16 17 +113%11 +38%5 −69%4 −75%
Net profit4 3 9 9 9 +125%4 +33%-1 −111%-20 −322%
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

  • Lighting, Fan & Switch
    ₹62.3 Cr Revenue
  • Home Appliance
    ₹102.8 Cr Revenue330% Kitchen & Home Care Growth
  • Personal Segment
    10% YoY Decline
  • FHP Motor
    ₹45.6 Cr Revenue

Capital allocation

high confidence
  • Capex ₹100 Cr
    • Phase I of new plant at Bhiwadi ₹60 Cr
    • Growth of existing businesses and factories ₹35 Cr
    CapEx for the year will be INR 100 crores to INR 110 crores, split as INR 60 crores to 65 crores for Phase I of the new plant at Bhiwadi, and INR 35 crores to 40 crores for growth of the existing businesses and factories.
  • Liquidity Cash ₹59 Cr Net cash position as of December 25.
    Our liquidity position remains strong with net cash of INR 59 crores as at December 25.

Guidance & targets

Revenue

  • Revenue Growth Revenue · FY26 · Medium confidence 9-10%
    I would like to share our guidance of 9% to 10% for revenues from FY25-26.

    — SANJEEV SETHIA

EBITDA Margin

  • EBITDA Margin EBITDA Margin · FY26 · Medium confidence 5.3-5.8%
    EBITDA forecast for the year is forecast at 5.3% to 5.8% margin.

    — SANJEEV SETHIA

Capex

  • Total CapEx Capex · FY26 · High confidence INR 100-110 crores
    CapEx for the year will be INR 100 crores to INR 110 crores, split as INR 60 crores to 65 crores for Phase I of the new plant at Bhiwadi, and INR 35 crores to 40 crores for growth of the existing businesses and factories.

    — SANJEEV SETHIA

Bhiwadi Plant Revenue

  • Revenue Bhiwadi Plant Revenue · FY27 · High confidence INR 140 crores
    We expect revenue of INR 140 crores in FY27 and INR 250 crores in FY28.

    — SANJEEV SETHIA

  • Revenue Bhiwadi Plant Revenue · FY28 · High confidence INR 250 crores

    — SANJEEV SETHIA

Bhiwadi Plant Revenue Potential

  • Revenue Potential Bhiwadi Plant Revenue Potential · Long-term · Medium confidence INR 550-600 crores
    Reiterating that as per current estimates, revenue potential of the plant is INR 550 crores to INR 600 crores.

    — SANJEEV SETHIA

Bhiwadi Plant EBITDA

  • EBITDA Margin Bhiwadi Plant EBITDA · Steady state · High confidence 7-7.5%
    state EBITDA of 7% to 7.5% for this plant.

    — SANJEEV SETHIA

Bhiwadi Plant ROCE

  • Return on Capital Employed Bhiwadi Plant ROCE · Steady state · High confidence 20%
    At these levels, return on capital employed for the plant will be at 20%.

    — SANJEEV SETHIA

Lighting Business

  • Revenue from new customers Lighting Business · FY27 · Medium confidence INR 150-170 crores
    I think the existing new customers, so we are looking at about the revenue of in terms of lighting from the new customers to the tune of around maybe INR 150 crores to 170 crores in the coming fiscal.

    — SANJEEV SETHIA

  • Growth Lighting Business · FY27 · Medium confidence Double-digit growth
    With his experience and customer connections, we reiterate that we expect double-digit growth in our lighting business in FY2627.

    — SANJEEV SETHIA

Fan Business

  • Growth Fan Business · FY27 · Medium confidence 50%
    Overall, we expect fans to grow by another 50% in FY2627.

    — SANJEEV SETHIA

OFR and Chimney (Bhiwadi)

  • Business Outlook OFR and Chimney (Bhiwadi) · FY27 · Medium confidence INR 170 crores
    So, we are fairly confident that these two products alone should give us about a INR 170 crores kind of business outlook.

    — SANJEEV SETHIA

What to watch in Q4 FY26

Working Capital Days

by March end (Q4 FY26)
Current Net 68 days
Target Net 50 days

Why it matters

To assess efficiency in inventory management and cash flow generation.

Our working capital position is at net 68 days due to higher than normal inventory levels. We expect this to normalize within this quarter.

Risks & concerns

  • Raw material cost inflation

    medium

    Sharp surge in copper, steel, and aluminum prices impacted gross margins, though repricing is expected in the next quarter.

    Management acknowledged

  • Demand volatility in Personal Care segment

    medium

    Personal segment was down 10% YoY due to weak and erratic demand, particularly in urban discretionary categories.

    Management acknowledged

  • Working capital increase due to inventory build-up

    low

    Net working capital days increased to 68 due to higher inventory, but expected to normalize to 50 days by March end.

    Management acknowledged

  • Delay in Bhiwadi plant commissioning

    low

    Slight delay in Bhiwadi plant due to pollution control restrictions, now expected operational by May 2026.

    Management acknowledged

Q&A highlights

7 direct
Competitive advantage of new products (OFR, Chimneys, Air Coolers) Direct
in oil fill radiator heaters, we are the only company in India who is doing the complete fin assembly locally... for chimneys also... we are currently the largest manufacturers of chimney motors in the country... In terms of air coolers again, we know it's a combination of the cooler motor, the submersible pump, and the swing motor, which is totally being done in-house, including the plastic molding.

Analyst questioned how Elin enters new markets with high competition; management explained their backward integration provides a distinct cost and lead time advantage.

Asked by Rahil Dasani

Cost competitiveness of new products Direct
in terms of OFR, since that is we see that we are easily about 7% -- 6% to 8% more competitive than imports for a totally locally made OFR heater. Chimney, again based on the current BOM and the current price valuation, and the way which we have got in, I think we are, again, at least minimum 5% cheaper than the competition.

Management provided specific cost advantages for OFR and Chimneys, validating the benefits of their backward integration strategy.

Asked by Rahil Dasani

Entry strategy and competitive edge for new lighting customers Direct
We enjoy a very good reputation in the market as a very premium quality supplier. So, at similar prices we have been able to attract some of the customers from our competition. And like I said, with the addition of a new resource who has a very proven track record of dealing with multiple customers in the lighting business, it has helped further attract these customers.

Analyst asked how Elin acquired 6 new lighting customers despite high competition; management cited their long-standing reputation, quality, and new business development resources.

Asked by Rahil Dasani

Impact of raw material prices on gross margins and future outlook Partial
our key raw materials, especially on the material side, so steel, copper, and aluminum, have seen a fairly sharp increase... The impact of this increase, which will be repriced subsequently in the next quarter, has been borne by us in the current quarter.

Analyst inquired about the 40bps margin decline; management attributed it to raw material inflation and indicated repricing would occur in the next quarter, but acknowledged unpredictability of metal prices.

Asked by Ananya Nichani

Impact of BIS regulations on FHP motors and local manufacturing Direct
For us, the next big growth boom which could happen because of BIS would be our FHP, Fractional Horsepower Motor business. That is still not 100% under BIS... I think, it's slated to come in for August or September 2026.

Analyst asked about the timing and impact of BIS; management highlighted FHP motors as a significant future growth driver once BIS regulations are fully implemented, especially for washing machine and AC ODU BLDC motors.

Asked by Kunal Mehta

Working capital normalization and inventory build-up Direct
there were certain abnormal inventory build-up that we have seen during the quarter, towards the end of the quarter. We expect that to normalize within this quarter itself. So hopefully, as of the end of March, we should be around the 50 target that we have set out, on a net basis, of course.

Analyst questioned the increase in working capital days; management explained it was due to temporary inventory build-up and provided a clear target for normalization by March end.

Asked by Kunal Mehta

Utilization of Ghaziabad plant capacity after shifting production to Bhiwadi Direct
we are looking at two product categories to offset and then further grow. One, I had mentioned that the fan business overall is doing fairly well for us... The second category is in terms of the small appliance business, there are certain -- there is especially the mixer grinder category. We are looking to start operations out of our Ghaziabad plant also, as well.

Analyst raised concern about potential underutilization of Ghaziabad plant; management outlined plans to grow fan business and shift mixer grinder production to maintain utilization and improve efficiency.

Asked by Rahil Dasani

Expansion plans for the motor division Direct
we are looking to expand our motor capacities... We are getting into the BLDC chimney segment, and we are looking at two more segments, one is the washing machine segment and the AC, ODU, IDU, BLDC motors for further expansion.

Analyst asked about expanding motor capacity given captive needs and BIS opportunities; management confirmed expansion plans for specific motor types, indicating future growth areas.

Asked by Samarth Ashok

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Detailed narrative

Q3 FY26 Financial Performance Overview

Elin Electronics reported a strong Q3 FY26, with operating revenues reaching INR 294 crores, marking a 10.52% year-over-year increase from INR 266 crores. This growth was primarily fueled by robust performance in the appliances and fan businesses. Consolidated EBITDA surged by 56.57% YoY to INR 11.9 crores, up from INR 7.6 crores in the prior year, leading to an EBITDA margin of 4.04%. Net profit also saw significant growth, increasing by 171.4% YoY to INR 3.8 crores from INR 1.4 crores.

Segmental Performance and Strategic Focus

The fan business demonstrated exceptional growth, achieving 100% YoY expansion, largely driven by BLDC ceiling fans, with expectations for another 50% growth in FY27. The home appliance segment also showed robust growth, with revenues increasing from INR 52.3 crores last quarter to INR 102.8 crores this quarter, and Kitchen and Home Care revenues up 330% YoY. Conversely, the lighting segment experienced a 7.84% YoY decline to INR 62.3 crores, and the personal segment was down 10% YoY. The FHP motor segment saw an 18.28% QoQ decline, attributed to a tepid Diwali and delayed cooler/AC season, but is expected to rebound.

Margin Dynamics and Raw Material Impact

While overall margins improved, the company noted a sharp surge in raw material costs, particularly for copper, steel, and aluminum, which impacted gross margins. Management indicated that the impact of these increases, which led to a 40 basis points lower gross margin, would be repriced in the next quarter. The full-year EBITDA forecast is set at a margin of 5.3% to 5.8%, acknowledging the impact of export sales, which typically carry higher margins, being nil since August 2025.

Bhiwadi Plant Update and Expansion Plans

The new Bhiwadi factory, with a total project cost estimated at INR 100 crores, is progressing well and is expected to be operational by May 2026, despite a slight delay due to pollution control restrictions. This plant is projected to contribute INR 140 crores in revenue in FY27 and INR 250 crores in FY28, with a long-term potential of INR 550-600 crores. The plant is expected to achieve an EBITDA margin of 7-7.5% and a Return on Capital Employed (ROCE) of 20% at steady state. Capex for FY26 is projected at INR 100-110 crores, with INR 60-65 crores allocated to Bhiwadi Phase I and INR 35-40 crores for existing operations.

Customer Acquisition and Product Diversification

In the lighting segment, Elin has successfully onboarded five new customers, with plans for one or two more, expecting to generate INR 150-170 crores in revenue from these new customers in FY27. The company's strategy for new products like OFR, chimneys, and air coolers leverages its backward integration, making it 6-8% more competitive for OFR and 5% for chimneys. Elin is also expanding its motor division to include BLDC chimney motors and washing machine motors, with AC ODU BLDC motors under consideration for future expansion.

Working Capital and Ghaziabad Plant Strategy

The company's working capital position increased to net 68 days due to higher inventory levels, but management expects this to normalize to around 50 days by March end. To address potential underutilization at the Ghaziabad plant once OFR production shifts to Bhiwadi, Elin plans to significantly grow its fan business, targeting 50% growth in FY27, and to shift mixer grinder production from Baddi to Ghaziabad. This move aims to improve logistics, overall efficiency, and offer better pricing, thereby attracting new customers for mixer grinders.

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