Elin Electronics

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.

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.

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.

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.

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.

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.