Greaves Cotton Limited — Q4 FY25 earnings call

Call held 30 Apr 2025

Management summary

Greaves Cotton reported strong financial and operational performance in Q4 and FY25, driven by diversification and strategic acquisitions. Consolidated revenues for Q4 FY25 reached ₹823 crores, with full-year revenues at ₹2,918 crores. Profitability improved, with combined EBITDA margins at 16.4% for Q4 and 15% for FY25. The company is focused on sustainable growth, operational excellence, and capital efficiency, supported by a healthy balance sheet with ₹379 crores in standalone cash reserves.

Highlights

  • Q4 FY25 Consolidated Revenues: ₹823 crores

  • FY25 Consolidated Revenues: ₹2,918 crores

  • Q4 FY25 Combined EBITDA (GCL + Excel): ₹107 crores, margin 16.4%

  • FY25 Combined EBITDA (GCL + Excel): ₹338 crores, margin 15%

  • Greaves Cotton Standalone Revenue Q4 FY25: ₹573 crores, up 19% YoY

  • Greaves Cotton Standalone Revenue FY25: ₹1,988 crores, up 12% YoY

  • Electric Mobility division FY25 revenues: ₹659 crores

  • Electric two-wheeler market share Q4 FY25: 4.3%, up from 3.4% QoQ

Key financials

  1. Consolidated Revenue ₹823 Cr
  2. Consolidated Revenue ₹2,918 Cr
  3. GCL Standalone Revenue ₹573 Cr +19%YoY
  4. GCL Standalone Revenue ₹1,988 Cr +12%YoY
  5. Excel Controlinkage Revenue ₹75 Cr +15%YoY
  6. Excel Controlinkage Revenue ₹268 Cr
  7. GCL Standalone EBITDA ₹84 Cr
  8. GCL Standalone EBITDA Margin 14.7%
  9. Combined EBITDA (GCL+Excel) ₹107 Cr
  10. Combined EBITDA Margin (GCL+Excel) 16.4%
  11. GCL Standalone EBITDA ₹260 Cr
  12. Combined EBITDA (GCL+Excel) ₹338 Cr
  13. Combined EBITDA Margin (GCL+Excel) 15%
  14. Electric Mobility Revenue ₹659 Cr
  15. Return on Capital Employed 19%
  16. Cash Reserves (Standalone) ₹379 Cr

What they filed

Q1 FY27: revenue up 30.7%, net profit down 70.5% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue705 751 823 745 815 +16%875 +17%1,000 +22%974 +31%
EBITDA23 40 46 57 52 +125%62 +57%68 +49%56 −1%
Net profit-14 7 2 21 6 +144%6 −11%2 +44%6 −70%
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

  • Engineering Division
    14% Revenue Growth4% Genset Market Share
  • Retail Division
    7% Revenue Growth
  • Electric Mobility Division
    7.4% Revenue Growth10% e2-wheeler Volume Growth61% L5 Segment Volume Growth3.7% L5 Diesel Segment Market Share4.3% e2-wheeler Market Share3.4% e2-wheeler Market Share QoQ

Guidance & targets

Revenue

  • Group Topline Revenue · by 2030 · High confidence ₹15,000 crores
    I might just add that the Greaves Board had set itself a vision to achieve Rs. 15,000 crore topline on a group basis by 2030 through a blend of organic growth and strategic acquisitions and the management of Greaves Cotton and Greaves Electric Mobility remain committed to the same.

    — Karan Thapar, Chairman of the Board, GCL

Capex

  • Excel Controlinkage Capex Capex · over 3-4 years · High confidence ₹100 crores
    basically we have outlaid almost Rs. 100 crore capex plan when we invested in this Company and this was something that we were planning to undertake over a 3 to 4-year period.

    — Akhila Balachandar, CFO, GCL

  • Internal Growth Capex Capex · coming year · High confidence ₹100 crores
    We will outlay approximately Rs. 100 crore capex even in the coming year for our internal growth purpose.

    — Akhila Balachandar, CFO, GCL

Capacity

  • Excel Controlinkage Turnover Capacity · null · High confidence 3x current turnover
    The idea was we should be able to do 3x turnover with this kind of an investment.

    — Akhila Balachandar, CFO, GCL

Subsidy

  • EV 2-wheeler Subsidy Subsidy · FY25 · High confidence ₹2,500 per kWh, capped at ₹5,000 per vehicle
    So, the subsidy presently is at Rs. 2,500 per kWh on two-wheeler which is capped at Rs. 5,000 per vehicle.

    — K. Vijaya Kumar, ED and CEO, GEML

  • EV L5 3-wheeler Subsidy Subsidy · FY25 · High confidence ₹5,000 per kWh, capped at ₹25,000 per vehicle
    And on the L5 three-wheeler it is at Rs. 5,000 per kWh capped at Rs. 25,000 per vehicle.

    — K. Vijaya Kumar, ED and CEO, GEML

  • EV Subsidy Scenario Subsidy · next year · Medium confidence Non-subsidy environment
    So, we are looking forward to a non-subsidy scenario next year, this year as I explained to you presently.

    — K. Vijaya Kumar, ED and CEO, GEML

Risks & concerns

  • Regulatory approvals for Greaves Electric Mobility IPO (DRHP)

    medium

    The proposed IPO is subject to receipt of regulatory approvals from SEBI, market conditions, and other commercial considerations.

    Management acknowledged

  • EV subsidy framework changes / non-subsidy scenario

    medium

    Management is looking forward to a non-subsidy scenario next year, implying potential impact on EV business if products cannot compete on value proposition alone.

    Both acknowledged

  • External uncertainties

    low

    Management remains optimistic about the future while acknowledging external uncertainties.

    Management acknowledged

Areas of evasion (3)

  • EV business profitability and EBITDA breakeven
  • specific burn rate for EV business
  • post-IPO shareholding structure

Q&A highlights

1 direct, 1 evasive
EV business profitability and volume vs revenue growth Evasive
Going forward on the profitability part, as you are aware, we are waiting regulatory clearances from SEBI on our DRHP. So, I think I would constrain myself from giving any forward-looking statements as we have already mentioned it in our DRHP in detail.

Management explicitly declined to comment on EV profitability and EBITDA breakeven due to DRHP filing, which is a key area of interest for investors.

Asked by Tushar Bohra

EV subsidy framework and burn rate Partial
My question was more particular to the subsidy part of the story, the type of uncertainty that is there in the subsidy. I think some recent changes were also made a couple of days ago. So, what are you factoring in going ahead in terms of the subsidy part of the story? And when will this burn ratio start falling? I mean to say, we have posted higher turnover for the year but so have the losses.

Analyst pressed on the impact of subsidy uncertainty and EV business losses, which management addressed by detailing current subsidy levels and stating they anticipate a non-subsidy scenario next year, but did not directly address the 'burn ratio' or specific profitability timeline.

Asked by Saket Kapoor

Cash utilization and capex plans for standalone business Direct
So, over the last 2-3 years, we have been consistently deploying around Rs. 80 crore to Rs. 100 crore of capex into the business. All these have gone in adding new production lines, working on automation, improving our efficiencies, de-bottlenecking and we will continue on this journey. We will outlay approximately Rs. 100 crore capex even in the coming year for our internal growth purpose.

Provided clear, specific details on past and future capex plans for the standalone business, indicating strategic investment for growth and efficiency.

Asked by Vineet Bansal

2 min read 5 chapters

Detailed narrative

Strong Q4 and FY25 Performance

Greaves Cotton delivered robust financial results for Q4 and the full year FY25. Consolidated revenues for Q4 FY25 stood at ₹823 crores, with full-year revenues reaching ₹2,918 crores. The combined EBITDA for Greaves Cotton and Excel Controlinkage was ₹107 crores in Q4, achieving a margin of 16.4%, and ₹338 crores for FY25 with a 15% margin, reflecting improved cost structure and operating leverage. The standalone business also showed strong growth, with revenues up 19% YoY in Q4 to ₹573 crores and 12% YoY for FY25 to ₹1,988 crores.

Diversified Growth Across Verticals

The company's transformation strategy and portfolio diversification continue to drive growth. The Engineering and Retail divisions grew annually by 14% and 7% respectively in FY25. Greaves Engineering saw dominant growth from non-automotive applications, particularly gensets, where market share improved to around 4%. Excel Controlinkage, a strategic acquisition, contributed ₹75 crores to Q4 revenues (up 15% YoY) and ₹268 crores to full-year revenues, demonstrating strong performance.

Electric Mobility Division's Progress

The Electric Mobility division posted revenues of ₹659 crores for FY25, with e2-wheeler volumes growing 10% YoY and L5 segment volumes up 61% YoY. The division's electric two-wheeler market share increased from 3.4% in Q3 FY25 to 4.3% in Q4 FY25, driven by new model launches like Magnus Neo. Management noted strong market share in specific states, such as 15% in Tamil Nadu, and is actively working to expand market share in other regions.

Strategic Investments and Capital Efficiency

Greaves Cotton maintains a strong financial position with ₹379 crores in standalone cash reserves and a near-zero debt balance sheet. The company reported a healthy 19% Return on Capital Employed for FY25. Management plans to outlay approximately ₹100 crores in capex for internal growth in the coming year, in addition to ongoing de-bottlenecking initiatives at Excel Controlinkage, where a ₹100 crore capex plan over 3-4 years aims for a 3x turnover.

Long-Term Vision and Future Outlook

The Board has set an ambitious vision to achieve ₹15,000 crores in group topline by 2030 through a blend of organic growth and strategic acquisitions. While management is constrained from discussing EV profitability due to DRHP filing, they anticipate a non-subsidy scenario for EVs next year, focusing on product value proposition. Initiatives in hydrogen powertrain, aerospace, and defence are in early stages, with Excel already contributing to these areas, indicating future diversification.

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