Menon Bearings Limited — Q1 FY27 earnings call

Call held 17 Jul 2026

Management summary

Menon Bearings Limited delivered a strong Q1 FY27, achieving record sales, EBITDA, PBT, and PAT with significant YoY growth across standalone and consolidated financials. The company is pursuing strategic growth in new segments like railway brakes and expanding international business in Alkop, while also investing in capacity. Despite global uncertainties and rising raw material costs, management is confident in sustaining strong margins through operational efficiencies.

Highlights

  • Q1 FY27 recorded highest-ever sales, EBITDA, PBT, and PAT in the company's history for the quarter.

  • Standalone sales increased to INR 67.06 crores, a 40.41% YoY increase from INR 47.76 crores.

  • Standalone EBITDA was up approximately 60% YoY.

  • Standalone Profit After Tax (PAT) increased by 63.53% to INR 11.23 crores.

  • Consolidated sales increased to INR 91.79 crores, a 36.57% YoY increase from INR 67.21 crores.

  • Consolidated EBITDA increased by 57% YoY.

  • Consolidated Profit After Tax (PAT) increased by 67.35% YoY.

  • Earnings Per Share (EPS) improved significantly to INR 2.52 compared to INR 1.50.

Concerns

  • The global business environment continues to present certain uncertainties.

  • Merchant export orders were stuck for the last three months due to geopolitical situations and the Straight of Hormuz, though they have now restarted.

  • Raw material prices, such as carbide tools, increased by 300%, and these costs are not always passed on to customers.

  • The monsoon position may affect the tractor segment to some extent, though it is expected to improve.

Key financials

  1. Consolidated Sales ₹91.79 Cr +36.6%YoY
  2. Consolidated EBITDA Growth 57% +57%YoY
  3. Consolidated PBT ₹18.51 Cr +67.4%YoY
  4. Consolidated PAT Growth 67.3% +67.3%YoY
  5. Consolidated EPS ₹2.52 +68%YoY
  6. Standalone Sales ₹67.06 Cr +40.4%YoY
  7. Standalone PAT ₹11.23 Cr +63.5%YoY

What they filed

Q1 FY27: revenue up 39.6%, net profit up 57.1% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue41 39 46 48 44 +7%57 +46%64 +39%67 +40%
EBITDA8 7 9 10 8 +0%12 +71%15 +67%16 +60%
Net profit5 4 6 7 6 +20%8 +100%10 +67%11 +57%
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

SegmentEBITDA MarginCapacity Utilization
Bi-metal (Bearings)21%80%
Alkop (Aluminium)21%65%
Brakes25%65%
Consolidated21.5%—

Capital allocation

high confidence
  • Capex ₹9 Cr
    • Increasing bi-metal capacity by 25-30% ₹9 Cr
    • Alkop capacity expansion ₹4 Cr
    Arun Aradhye: "we are investing about INR9 crores to INR10 crores of rupees for this year, this financial year for increasing the capacity and which is expected to increase the capacity by almost 25% to 30%" and "we are having the CapEx of around INR4 crores of for this year in Alkop alone."

Guidance & targets

Revenue

  • Additional business potential (current & next FY) Revenue · Current and next financial year · Medium confidence INR 65 crores to INR 75 crores
    The total potential of additional business for the current and next financial year is expected to be around INR65 crores to INR75 crores, subject to good monsoon and geopolitical situation doesn't worsen further.

    — Arun Aradhye

  • Brake segment revenue (initial) Revenue · First year after dynamometer commissioning · Medium confidence INR 5 crores to INR 6 crores
    with this in the first year itself, we expect that to start with, we will have a business of around INR5 crores to INR6 crores to start with

    — Arun Aradhye

  • Brake segment revenue (long-term) Revenue · Within next two years · Medium confidence INR 25 crores to INR 30 crores
    eventually it will go up to INR25 crores to INR30 crores within next two years.

    — Arun Aradhye

  • Alkop revenue Revenue · This year (FY27) · High confidence INR 100 crores
    For this year, we are targeting Alkop for INR100 crores

    — Aditya Menon

  • Alkop revenue Revenue · Next year (FY28) · High confidence INR 125 crores
    next year around INR125 crores.

    — Aditya Menon

  • Export share of total revenue Revenue · Next year · Medium confidence 37%

    From 24% to 30% today

    As we expect that by next year, the export may go up to 37% after total revenue.

    — Arun Aradhye

  • Bi-metal peak revenue potential (with current capacity) Revenue · Medium confidence Above INR 400 crores
    Peak revenue from this, it can be aboveINR400 crores.

    — Arun Aradhye

  • Overall revenue growth Revenue · Year on year · High confidence 20% plus
    You see, there is always a target, we have set ourselves on a conservative basis of 20% plus year on year.

    — Arun Aradhye

  • Overall revenue growth (aspirational) Revenue · Year on year · Low confidence 25%
    So considering that, we don't know, it can be 25% also.

    — Arun Aradhye

  • Total revenue Revenue · This year (FY27) · High confidence INR 360 crores
    And we have told INR360 crore is a conservative number. But I don't want to comment more on the final number.

    — Aditya Menon

  • Total revenue Revenue · By 2030 (trying sooner, next 2-3 years) · Medium confidence INR 500 crores
    We were supposed to reach INR500 crore in 2030, but we are trying to do it as soon as possible. So, in the next 2-3 years, it's our internal target, but let's see.

    — Aditya Menon

  • Additional business from domestic RFQs Revenue · Next one to two years · Medium confidence INR 60 crores
    we can definitely add within this year and next year to the extent of more than INR60 crores of rupees with the additional business we will be getting.

    — Arun Aradhye

Profitability

  • Consolidated EBITDA Margin Profitability · Over a period of time · High confidence 20% to 21%
    But overall, on a consolidated basis, if you see, we will sustain around 20% to 21% of margins over a period of time.

    — Arun Aradhye

Capacity

  • Bi-metal capacity increase Capacity · This financial year · High confidence 25% to 30%
    we are investing about INR9 crores to INR10 crores of rupees for this year, this financial year for increasing the capacity and which is expected to increase the capacity by almost 25% to 30%

    — Arun Aradhye

Market Share

  • EV share in Alkop business Market Share · FY27 end (near future, next two years) · Medium confidence 8% to 10%

    From 4% to 5% today

    Currently, we are at around 4% to 5% EV. ... So 8% is for the near future, for the next two years.

    — Aditya Menon

What to watch in Q2 FY27

Brake segment dynamometer commissioning and railway approval

Next quarter (August/September end)
Current Under construction, expected by August end, railway audit/approval to follow.
Target Dynamometer commissioned, railway approval process initiated, initial orders.

Why it matters

This is a new, high-potential segment for the company, and progress on commissioning and approvals is key to realizing revenue targets.

You see, basically that is under construction now and is expected by the end of August. Thereafter, the railway people will come and visit our shop. They will have a thorough audit and after that they will approve our company Menon Brakes for registration with railway and thereafter testing, validation, etc., it will start and it will take another one year

Risks & concerns

  • Global business environment uncertainties and geopolitical situation

    medium

    The global business environment continues to present certain uncertainties, and the geopolitical situation could worsen further.

    Management acknowledged

  • Impact of war on merchant export orders

    medium

    War and the Straight of Hormuz backlog caused merchant export orders to be stuck for the last three months, though they have now restarted.

    Management acknowledged

  • Raw material price increases not passed on to customers

    medium

    Raw material prices, such as carbide tools, increased by 300%, and these costs are not always passed on to customers, requiring operational efficiencies to maintain margins.

    Management acknowledged

  • Monsoon impact on tractor segment

    low

    The monsoon position may affect the tractor segment to some extent, but it is expected to improve within a month or two.

    Management acknowledged

Q&A highlights

7 direct
Brake segment revenue potential and timeline Direct
Arun Aradhye: "with this in the first year itself, we expect that to start with, we will have a business of around INR5 crores to INR6 crores to start with and eventually it will go up to INR25 crores to INR30 crores within next two years.

Provides specific revenue targets and timeline for a new growth segment (railway brakes) after dynamometer commissioning.

Asked by Arnav Sakhuja

Alkop new business from Canada/US and revenue visibility Direct
Aditya Menon: "For this year, we are targeting Alkop for INR100 crores, next year around INR125 crores. Like I told you, in Alkop for new business to get realized, it takes around 9 to 12 months.

Clarifies the revenue potential and timeline for new international business in the Alkop division, driven by recent visits and China Plus One policy.

Asked by Bhargav Buddhadev

EV share in Alkop business and competitive advantage Direct
Aditya Menon: "Currently, we are at around 4% to 5% EV. ... So 8% is for the near future, for the next two years.

Indicates the company's progress and targets in the EV segment within Alkop, highlighting their focus on high-technical parts and confidence from OEMs.

Asked by Bhargav Buddhadev

Bi-metal division capacity utilization and peak revenue Direct
Arun Aradhye: "Peak revenue from this, it can be aboveINR400 crores." Aditya Menon: "Roughly, I will tell you bearing around 80%.

Provides insight into the maximum revenue potential from the core bi-metal business with existing capacity and current utilization levels.

Asked by Rucheeta Kadge

Export target for FY27 and new geographies Direct
Arun Aradhye: "As we expect that by next year, the export may go up to 37% after total revenue." Aditya Menon: "we are taking efforts to do different geographies in the USA.Now, we went to Canada. ... In September, we have a visit to Europe.

Details the company's strategy for export growth, including diversification into new regions beyond the US and existing customers.

Asked by Disha Chamriya

Sustainability of 25% EBITDA margins in brakes Partial
Arun Aradhye: "But at the same time, 25% we could achieve in brakes because of the product mix as already explained by Mr. Aditya. If the product mix is something different in the coming quarter, it may go down or may increase further also.So, we are not very sure. But overall, on a consolidated basis, if you see, we will sustain around 20% to 21% of margins over a period of time.

Clarifies that while 25% in brakes was due to product mix and may not be sustained, overall consolidated margins are expected to remain strong at 20-21%.

Asked by Nishant Sharma

Differentiating factors of Menon Bearings Direct
Arun Aradhye: "Differentiating factor is that we are having an integrated facility, our productivity comparatively is very good. We are accepting only critical components and critical parts where value addition is better." Aditya Menon: "Reliability, whatever quality issue or whatever, they know they can rely on us.

Explains the company's competitive advantages, focusing on integrated facilities, quality, and customer relationships for critical components.

Asked by Neha Garg

Overall revenue guidance for FY27 and long-term Direct
Aditya Menon: "And we have told INR360 crore is a conservative number. ... We were supposed to reach INR500 crore in 2030, but we are trying to do it as soon as possible. So, in the next 2-3 years, it's our internal target, but let's see.

Reconfirms the conservative FY27 revenue target and provides an aspirational long-term target, indicating management's confidence in future growth.

Asked by Nishant Sharma

2 min read 6 chapters

Detailed narrative

Record Performance in Q1 FY27

Menon Bearings Limited achieved its highest-ever Q1 sales, EBITDA, PBT, and PAT. Consolidated sales grew 36.57% YoY to INR 91.79 crores, with EBITDA up 57% and PAT up 67.35%. Standalone sales for Bi-metal Menon Bearings increased 40.41% YoY to INR 67.06 crores, and PAT rose 63.53% to INR 11.23 crores. This robust growth was supported by healthy demand across all business segments and improved operational efficiencies.

Strategic Growth in Brake Segment and Railways

The company is poised for significant growth in its brake segment, particularly with the dynamometer expected to be commissioned by August end. This will facilitate railway approvals, with initial business projected at INR 5-6 crores in the first year, potentially growing to INR 25-30 crores within two years. The brake segment demonstrated strong profitability in Q1 FY27, achieving an impressive 25% EBITDA margin, a substantial increase from the 12-14% seen in previous years, attributed to a favorable product mix and operational excellence.

International Expansion and Alkop Division Outlook

Menon Bearings is aggressively expanding its international footprint, targeting Alkop revenue of INR 100 crores this year and INR 125 crores next year. Recent visits to Canada and the USA have yielded significant RFQs and NDAs from major OEMs, with new business expected to materialize in 9-12 months. The company also aims to increase its export share of total revenue from the current 24-30% to 37% by next year, actively exploring new markets in Europe and Africa.

Capacity Enhancement and Margin Sustainability

To meet growing demand, the company plans to invest INR 9-10 crores in bi-metal capacity expansion this fiscal year, targeting a 25-30% increase, which could generate over INR 25 crores in additional revenue. The bi-metal division currently operates at approximately 80% utilization, with a peak revenue potential exceeding INR 400 crores. Despite challenges like a 300% increase in carbide tool prices, consolidated EBITDA margins for Q1 FY27 were 21.5-22%, and management expects to sustain 20-21% margins long-term.

Conservative Guidance and Long-term Vision

The company maintains a conservative revenue guidance of INR 360 crores for FY27, while internally targeting a 20% plus year-on-year growth, with an aspirational goal of 25%. A long-term target of INR 500 crores by 2030 is also in sight, with efforts to achieve it sooner. The Alkop division is focused on increasing its EV share from 4-5% to 8-10% in the near future, emphasizing high-technical parts for EV applications.

Operational Resilience Amidst Headwinds

Despite global uncertainties, geopolitical issues, and significant raw material price increases, Menon Bearings delivered record performance. The company highlighted its integrated facilities, high productivity, and focus on critical, high-value-add components as key differentiators. Management's proactive approach to operational efficiencies and cost optimization allowed them to achieve robust growth and profitability even in a dynamic business environment.

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