Jyoti CNC Automation Limited — Q3 FY25 earnings call

Call held 11 Feb 2025

Management summary

Jyoti CNC delivered a strong quarter characterized by significant margin expansion and a record order book, though top-line growth slowed to 19% due to temporary capacity bottlenecks. The company is aggressively expanding its manufacturing footprint in Rajkot and France to reduce execution timelines from 2.5 years to under 20 months. With a high-margin aerospace mix and a successful turnaround of its French subsidiary Huron, management remains bullish on achieving a record Q4.

Highlights

  • Consolidated Revenue reached ₹449.5 crores, representing 19% YoY growth (as acknowledged in Q&A) despite capacity bottlenecks.

  • EBITDA margin maintained at a robust 25% for the quarter; 9M FY25 margins expanded significantly to 25.2% from 18.8% YoY.

  • Order book stands at a massive ₹4,360 crores as of Dec 31, 2024, providing ~2.5 years of revenue visibility.

  • Aerospace segment continues to dominate, contributing 49% of Q3 revenue and 41% of the total order book.

  • PAT for Q3 surged 67% YoY to ₹80.2 crores, driven by improved product mix and operational efficiencies.

  • Subsidiary Huron (France) turned profitable with a 15.75% EBITDA margin and ₹65 crores revenue in Q3.

  • Management announced a ₹400 crore capex plan to expand capacity from 6,000 to 16,000 machines per annum over the next 2-3 years.

Concerns

  • Capacity Bottlenecks

Key financials

  1. Revenue ₹449.5 Cr +19%YoY
  2. EBITDA ₹112.6 Cr +17%YoY
  3. EBITDA Margin 25%
  4. PAT ₹80.2 Cr +67%YoY
  5. Order Book ₹4,360 Cr
  6. Order Inflow ₹492 Cr

What they filed

Q1 FY27: revenue up 36.8%, net profit up 20.8% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue376 400 529 372 448 +19%530 +33%599 +13%509 +37%
EBITDA95 112 176 99 111 +17%164 +46%191 +9%139 +40%
Net profit70 77 122 72 79 +13%105 +36%135 +11%87 +21%
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

SegmentRevenue ShareOrder Book Share
Aerospace49%41%
Auto and Auto Components16%16%
General Engineering21%18%
EMS10%16%

Guidance & targets

Volume

  • Q4 Machine Sales Volume · Q4 FY25 · High confidence 1500+
    roughly around 70% growth year-over-year in terms of machine sold, which would be around 1500 plus

    — Parakramsinh Jadeja, CMD

Capacity

  • Total Installed Capacity Capacity · next 3 years · High confidence 16,000 machines

    From 6,000 machines today

    Once the capacity comes in a picture and all I told you in past also that entire 16,000 capacity will be utilized in 3years.

    — Parakramsinh Jadeja, CMD

Capex

  • Expansion Capex Capex · FY26 · High confidence ₹400 crores
    So, yes, we are going to do Rs. 400 crores of CAPEX. And based on this CAPEX, the capacity will reach out to be 16,000 machines there total.

    — Parakramsinh Jadeja, CMD

Revenue

  • Huron Annual Revenue Revenue · FY25 · Medium confidence €35-40 million
    So, in terms of Huron, where our capacity close to this year is 35 to 40 million Euro to be executable there.

    — Parakramsinh Jadeja, CMD

Margin

  • Average Machine Realization Margin · next few quarters · Medium confidence ₹45-50 lakhs
    So, based on the order book, I think we will go near in between around 45 to 50 lakhs of a range to be there, average machine line.

    — Parakramsinh Jadeja, CMD

Risks & concerns

  • Capacity Bottlenecks

    high

    Current facilities were fully utilized in Q2/Q3, leading to slower revenue growth; new capacity is critical for Q4 and FY26.

    Both acknowledged

  • Import Competition

    medium

    60% of Indian machine tool consumption is still met by imports from Japan, Germany, and Korea.

    Management acknowledged

  • Execution Delays in France

    medium

    Huron is currently 'clumping on capacity' with a jammed floor due to high-value, large-space machines.

    Management acknowledged

Areas of evasion (1)

  • Specific revenue guidance for FY26 was avoided, though capacity targets were provided.

Q&A highlights

3 direct
Growth Deceleration in Q3 Direct
basically, in Quarter 2 and Quarter 3, we have, let's say, in past call also, I told you that we have reached to some bottleneck area to be there in terms of growth.

Explains why YoY growth dropped from 74%/43% in H1 to 19% in Q3, citing capacity constraints that are now being addressed.

Asked by Akshay, AK Investments

Huron Subsidiary Turnaround Direct
EBITDA in Huron is reached to 15.75%... In a past, last year nine months basis, it was a loss.

Confirms the successful turnaround of the French subsidiary, which was previously a drag on consolidated profitability.

Asked by Kushant Arora, Baroda BNP Asset Management

Order Book Execution Timeline Direct
today based on this Rs. 4,360 crores of the order book, in terms of today's run rate, let's say it will take 2.5 years... Their expectation also is to be within 18 to 20 months.

Highlights the gap between current execution speed and customer expectations, necessitating the massive capacity expansion.

Asked by Swanand Samant, Klay Capital

2 min read 5 chapters

Detailed narrative

Capacity Expansion to Unlock Order Book

Jyoti CNC is currently operating at peak capacity, which limited Q3 revenue growth to 19% YoY. To address this, the company is investing ₹400 crores to expand capacity from 6,000 to 16,000 machines per annum over the next 2-3 years. The first phase of this expansion in Rajkot is already underway, with new assembly lines expected to be operational by September 2025. This expansion is critical to reducing the current 2.5-year order book tail to a more competitive 18-20 months.

Aerospace Segment Drives High Realizations

The aerospace segment remains the primary growth engine, contributing 49% of Q3 revenue and 41% of the ₹4,360 crore order book. This high-margin mix has helped maintain consolidated EBITDA margins at 25%. The average machine realization reached a record ₹50.27 lakhs in Q3, up from historical levels, reflecting the shift toward sophisticated 5-axis machines and structural engine part machining for prime customers like Azad Engineering.

Huron Subsidiary Turnaround Complete

The French subsidiary, Huron Graffenstaden, has successfully transitioned from a loss-making entity to a profitable one, reporting a 15.75% EBITDA margin in Q3 FY25. Huron contributed approximately ₹65 crores to Q3 revenue and ₹200 crores for the 9-month period. Management expects Huron to achieve annual revenues of €35-40 million, with a new manufacturing building set to become fully operational by June 2025 to capture European market opportunities.

Aggressive Q4 Targets

Management has set an ambitious target for Q4 FY25, aiming to sell over 1,500 machines, which would represent roughly 70% YoY growth in volume. This follows the delivery of 894 machines in Q3. The company expects the removal of recent bottlenecks and the utilization of newly developed assembly lines to facilitate this significant sequential ramp-up in execution.

Import Substitution Opportunity

Despite being a leader in India, Jyoti CNC highlights that 60% of the domestic machine tool market is still served by imports from Japan, Germany, and Korea. The company is positioning its new high-end models, like the TachyonBeta (world's fastest 5-axis center) and the GU8 Gantry center, to directly compete with and replace these expensive imports. Management claims their technology is now 'twice faster' than some leading Japanese competitors in specific demonstrations.

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